The pandemic surge still impacts decking demand in the US

Southern Pine decking prices climbed to unprecedented heights during the pandemic, but have since retreated to previous levels

When demand for decking soared to unprecedented levels during the covid-19 pandemic and prices shattered records as a result, both Western Red Cedar and Southern Pine traders wondered how much future business was being pulled into 2020 and 2021.

Sales of 5/4×6 radius edged decking in both species have fallen well short of historical levels throughout the first half of 2023. Demand for Cedar decking languished at next to nil for months before gaining modest strength in early June.

The Southern Pine decking season has arrived late

Southern Pine decking markets also remained stagnant for most of 2023. Sales have kicked into gear in June, but traders note that the decking season in the South has arrived unusually late. The trends lead many traders to conclude that multiple years’ demand for decking had been pulled forward into a condensed time frame during the pandemic.

Decking and fencing sales were among the first items to surge when the pandemic first took hold. Pandemic lockdowns kept more people at home, and federal stimulus funds provided additional income for projects. New decks became a priority for an unusually large number of homeowners, and many proceeded with projects they might otherwise have put off for at least a few more years.

Southern Pine Premium 8-foot decking prices climbed to record-shattering levels during the height of the pandemic (see chart), but have since retreated more in line with historical levels. Other lengths of both SYP Standard and Premium decking followed a similar pattern.

Prices have been boosted by reduced Southern Pine production

Further, limited production of Southern Pine decking has helped offset lackadaisical demand this year. One decking mill burned down last year, pulling 60 million board feet of annual production off the market. A few other producers have remained offline for various reasons. Thinned production has helped buoy prices in 2023.

Cedar 5/4×6 decking prices posted weekly gains of as much as $70 shortly after stay-at-home orders were imposed. By May 2021, reported prices reached $4,000, more than double the previous record. The surge quickly reversed course starting in June 2021. Reported prices plummeted by $1,475 in eight weeks. Another steep decline in the spring and summer of 2022 dropped prices below $1,300, where they have hovered for most of 2023.

Decking traders struggle to identify a specific number or percentage of 2023 business robbed during the pandemic. But most say they are convinced it is a contributing factor limiting sales, especially to home centers, this year. Competition from composite decking represents another prominent factor. Composites are marketed as requiring little to no maintenance, making it an attractive option, especially in new higher-end homes.

Retailers who bought Cedar decking at historically higher levels have often been reluctant to lower prices in pace with the declines evident in the broader market. Many have instead leaned on sales of alternative species and composites.

Some Southern Pine decking producers note that sales have been surprisingly steady despite the overall lethargic pace. Rising interest rates have convinced many homeowners to remain in their current houses rather than buy a new one. As a result, those homeowners often harbor more incentive to build new decks and invest in other improvement projects.

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No feedback was received during the consultation period and therefore no changes will be made to the methodologies at this stage. This consultation sought to ensure that our methodologies continue to reflect the physical market under indexation, in compliance with the International Organization of Securities Commissions (IOSCO) principles for Price Reporting Agencies (PRAs). This includes […]