Demand for composite, PVC decking to rise
U.S. demand for decking is forecast to rise 2.4% annually, according to a study by the Freedonia Group, a Cleveland-based industry market research firm. This pace represents a rebound from the declines seen between 2006 and 2011, when housing completions plummeted and residential improvement and repair expenditures contracted from their elevated 2006 base. Through 2016, decking demand will be driven by an expected advance in housing completions and continuing consumer interest in decks as a way to increase their outdoor leisure space.
Wood-plastic composite and plastic lumber decking materials are expected to experience double-digit annual gains in demand through 2016, according to the Freedonia report. Plastic decking will see the most rapid growth. Consumers are expected to opt for the material because of its durability and low-maintenance requirements. The increasing availability of cellular PVC decking that better resembles natural wood will attract more customer interest. Composite decking demand will be supported by its favorable performance properties and reputation as a “green” product that uses recycled materials.
Although wood decking will continue to account for the majority of decking demand in volume and dollars, increased demand will rise less than 1% annually through 2016. Competition from composite and plastic decking, which need less maintenance, will limit growth, the report said.
The residential market accounted for 61% of decking demand in 2011, a lower share than the historical average. The depressed level of housing completions suppressed demand, as did an unfavorable lending environment that made it more difficult for homeowners to take out home equity loans, a common method of funding such projects as deck installation and replacement. Going forward, residential decking demand is forecast to rise at the fastest pace of all markets. Rebounding housing completions will spur gains in the new residential segment, and less restrictive credit conditions will support residential improvements and repairs.