Few building materials carry as many moving parts as softwood lumber. Trade agreements, weather, fire seasons, housing starts, and import duties can all move prices within a single year, sometimes within a single quarter. For buyers the swings show up directly in framing and finish budgets; for western red cedar, a premium product priced against composites, the volatility decides which projects use it at all. Homebuyers already learning how to buy a house in a sellers market now find material costs layered on top of bidding pressure, and cedar sits right at that intersection.
Softwood Market Drivers: Trade Pacts, Weather, and Housing Starts
The current cycle began in 2016, when the Softwood Lumber Agreement between the United States and Canada ended. With pricing uncertainty on the horizon, a strong U.S. economy, and rising lumber prices, shipments to the United States soared. The market then delivered two supply shocks in quick succession: heavy snowfall at the start of 2017 and a severe fire season that followed, both of which limited production and tightened supply.
Demand kept climbing because housing starts were up, but new duties pushed prices to records. At that point some consumers started looking at alternative products, and composites gained traction. Builders offset some of the risk by diversifying project types; mixed-use development spreads cost exposure across residential and commercial tenants, while single-family builders absorb the full swing of lumber costs.
What the end of the Softwood Lumber Agreement changed
The agreement had set duty rules for softwood imports. Its end replaced a stable framework with case-by-case duties, and importers responded by front-loading shipments before new rates landed. That burst of supply collided with weather-shortened domestic production, which is how the market could show record shipments and record prices in the same year.
Weather shocks and fire seasons
Snowfall closes logging roads; fire seasons pull harvesting crews into suppression work and cut available timber. Both hit supply at exactly the moment housing demand was rising, and neither appears in any forecast model with precision.
Reading the price signals
Record prices are the market’s way of rationing scarce material. Builders responded by substituting, delaying, or redesigning, and each response showed up downstream as lower cedar volumes in price-sensitive applications.
Market Research Quantifies Western Red Cedar Demand
To replace anecdote with numbers, the Western Red Cedar Lumber Association worked with Home Innovation Research Labs (HIRL) and a consulting partner to quantify the U.S. residential market. The study estimates that more than 1.066 billion board feet of western red cedar was consumed in the United States in 2016 across selected residential applications, in both new construction and repair and remodeling, with the majority of volume in the latter.
Research of this kind feeds the same conversations that drew global leaders to reimagine the future of buildings at Reimagine Buildings, where material demand and building performance are discussed together. Baseline consumer data collected in 2014 was followed by comparative data in 2017 and additional fieldwork in January and February of the following year.
The HIRL consumption study
The study also mapped where cedar sells. The Pacific Northwest, including Northern and Southern California and Hawaii, leads in volume; West South Central, East North Central, and South Atlantic regions follow. West South Central and East North Central posted the highest growth rates.
| Region | Consumption level | Growth rate | Leading applications |
|---|---|---|---|
| Pacific (incl. CA, HI) | Highest | Steady | Siding, decking, outdoor structures |
| West South Central | Moderate | Highest | Decking, fencing |
| East North Central | Moderate | Highest | Siding, fencing |
| South Atlantic | Moderate | Steady | Outdoor living areas, siding |
Awareness tracking since 2014
Consumer researcher Strategic Growth Insights has tracked awareness and attitudes among homeowners, builders, and architects, specifically against competitive composite products. Awareness has climbed since the 2014 baseline, and the 2017 comparative wave showed where the two product families stand in buyers’ minds.
What the baseline comparison shows
The split is consistent: wood wins on emotion, composites win on convenience. That split drives where each product is specified and how each is marketed.
Regional Consumption Patterns and What They Mean
Application mix varies sharply by region. In the Pacific, cedar reads as siding and outdoor living space; in Texas, Oklahoma, and Louisiana it moves as decking and fencing; in the upper Midwest, siding and fencing lead. Distributors and marketers who read these patterns can stock the right product mix for their service area.
Regional mixes also shift with the cycle. Distributors who track local indicators can position inventory for what comes when the market settles down, since smart strategies for builders in a normalized housing market start with knowing what sells where. The playbook for that moment is spelled out in guidance on when the market settles down.
Pacific dominance and coastal preferences
The Pacific region remains the largest consumer of western red cedar, a legacy of local supply, building traditions, and a climate where the species performs well outdoors. California alone spans two sub-regions in the study, and Hawaii shows up as a distinct high-value market.
Fast-growing interior regions
West South Central and East North Central grew fastest, which tracks population movement and a building boom in single-family housing. Growth markets behave differently from mature ones: more volume goes into new construction, lead times matter more, and price sensitivity is higher.
Using regional data in distribution planning
A distributor serving a fast-growth region should carry decking and fencing volume; one serving the Pacific should balance siding, outdoor structures, and premium grades. The data justifies inventory decisions that gut feel gets wrong.
Cedar vs Composite: What the Research Shows
The consumer research asked homeowners, builders, and architects to compare western red cedar with composite products on a range of attributes. Cedar scored higher on beauty of the product, natural appearance, pride in my home, and character, plus the pragmatic value of adding value to my home. Composites held a perceived advantage on ease of maintenance and cost.
The same housing wave that lifts cedar sales shows up in adjacent markets; aerial industry growth tracks project counts, and access-equipment makers read housing starts as a demand signal for their own equipment.
Emotional drivers favor wood
The attributes where cedar led in the research read like a list of emotional purchase triggers:
- Beauty of the product
- Natural appearance
- Pride in my home
- Character
- Adds value to my home
These are the attributes that sell a premium product. They also explain why cedar holds its share in visible applications like front elevations and outdoor living areas, where owners make a statement rather than a purely economic choice.
Maintenance and cost perceptions
Composites win on the practical axis: less maintenance, lower first cost. The perception persists even where modern factory finishes close the gap, which means cedar marketing has to answer the maintenance question head-on with data on coating systems and service life.
Applications Driving Cedar Demand
Four applications absorb most residential western red cedar: siding, decking, outdoor structures and living areas, and fencing. Each has its own specification logic, and each varies by region.
Local income and inventory data, such as Minnesota housing market trends for mid-income earners, help predict which applications will lead in a given metro, because household budgets decide between a cedar deck and a composite one.
Siding
Siding is the application that most directly rewards cedar’s natural appearance and character. It also competes hardest with fiber cement and engineered wood, so it tends to hold share in higher-end projects and in regions where the species is traditional.
Decking and outdoor living areas
Decking and outdoor structures anchor the repair and remodel market. Homeowners replacing a failing deck compare cedar against composites on cost, maintenance, and looks, and the 88 percent repair and remodel share means replacement demand is steadier than new construction.
Fencing and privacy screens
Fencing is the volume application in growth regions. It is less design-sensitive than siding, which makes it the battleground where price swings and composite competition show up first.
A practical sequence for selecting cedar applications:
- Confirm regional availability and typical lead times with a local distributor.
- Match the grade to the application: clear grades for visible siding, knotty grades for fencing.
- Compare life-cycle cost against composite alternatives, including refinishing intervals.
- Verify the coating or treatment plan for the exposure, especially in coastal and high-UV zones.
Sourcing and Pricing in a Volatile Market
Duties, tariffs, and weather will keep moving cedar prices. Current indications point to continued economic and housing start growth with a stable and sustainable supply of western red cedar, but the path between timber and deck is full of variables. The duty cycle that began in 2016 has broad parallels in how tariffs reshape the US real estate market, where material costs migrate into home prices.
Duties and the import picture
New duties arrived just as demand peaked, producing record prices. Importers and distributors learned to hedge: stock ahead of duty changes, diversify grades, and keep alternative species in the mix. The mechanisms that move construction costs through the economy are documented in analysis of how tariffs reshape the US real estate market.
Distribution and retail roles in flux
The relationship between distributor and retailer changed through the cycle and will keep changing. Some retailers consolidated purchasing through fewer distributors; others built direct mill relationships. Both shifts favor distributors with broad footprints and reliable fill rates.
Planning purchases around volatility
Buy early for known projects, lock pricing where contracts allow, and keep a fallback grade specified. Projects that can flex between clear and knotty cedar, or between cedar and a composite, absorb price shocks without stopping the job.