US wood-plastic composite & plastic lumber demand to spike by over 10% pa till 2018

US demand for wood-plastic composite and plastic lumber is expected to increase by over 10% pa to US$8.4 bln in 2018, creating a market for nearly 4 bln lbs of plastic, as per Freedonia. A rebound in new housing completions from the low 2013 level and gains in residential improvement and repair expenditures will generate increases in demand. Demand gains will also be boosted by increased market penetration in decking applications, the predominant use for composite and plastic lumber. Decking applications will account for more than two-fifths of composite and plastic lumber demand by 2018. Homeowners will increasingly choose decks made from alternative lumber because it has greater resistance to degradation by moisture, changes in humidity, insect attack, and time, and because it requires minimal maintenance over its long service life. Ongoing changes to manufacturing technologies that will improve the color-fade resistance and the resemblance to natural wood, particularly expensive hardwoods such as ipe and redwood, will further boost composite and plastic decking demand. Further gains will result from efforts by manufacturers to increase the scope of decking accessories offered. Among other applications, molding and trim applications are also expected to advance at a strong pace through 2018. Wood-plastic composite and plastic lumber use in molding and trim will benefit from renewed housing activity and performance characteristics -- such as resistance to moisture and ease of shaping -- that are superior to those of lumber and engineered wood. Increases in overall construction activity will support demand gains for both types of alternative lumber through 2018, but wood-plastic composite demand will rise at a quicker pace than demand for plastic lumber, albeit from a smaller base. As nearly two-thirds of composite and plastic lumber demand is generated by the residential market, expansion in that market will boost composite lumber demand. In large, high-growth residential applications such as decking, wood plastic composite is increasingly preferred to plastic lumber. Several factors will support its rapid growth. For instance, composite lumber includes cellulosic fibers and is better able to resemble the look and texture of traditional wood, an appealing trait to consumers looking for attractive but low maintenance decks. Furthermore, because composite lumber frequently is manufactured using recycled materials -- including consumable plastic such as grocery bags and stretch film, and wood scraps from mills and other lumber operations -- it is often marketed as an environmentally friendly building material.