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In the lumber section of the busy Home Depot outlet in downtown Vancouver, customers are greeted by ads for composite decking planks before they enter the store.

The fact that they have to walk a long way inside to find more traditional building products, such as cedar, is the first sign of changes that are rippling through North America's home-improvement industry.

Demand for maintenance-free homes is reverberating from the store level all the way to the coastal forest industry in British Columbia, still the world's leading source of cedar lumber.

Analysts say it may have persuaded U.S. giant Weyerhaeuser Co. to consider selling the B.C. coastal lumber assets it picked up by acquiring MacMillan Bloedel Ltd. in 1999.

Although company officials have declined to comment, a sale to Brascan Corp. or other major players on the B.C. coast would set the stage for consolidation of the province's cedar industry.

Long known for its appearance and durability, cedar lumber used in the production of decks and siding is still outselling, by a wide margin, timber substitutes made from plastic and wood fibre.

But that is expected to change over the next five to 10 years, as home owners switch to composites which are much easier to maintain and last much longer.

"Price is still a big sticking point," said Patrick Narain, a store clerk at the Home Depot in downtown Vancouver.

He was referring to the fact that a 5¼-inch western cedar plank sells for about $10, or about one third the price of its composite equivalent. But that hasn't stopped the production of composite decking in the United States from growing into a $1-billion (U.S) industry.

Sales in that sector are expected to double as composite makers such as Trex Company Inc. of Winchester, Va., move into a home-fencing sector still dominated by wood.

"This is a big change from 30 years ago, when cedar was so popular with home builders that just about everything on the West Coast seemed to have some cedar in it," said Laurie Cater, of Madison's Canadian Lumber Directory.

No longer.

A combination of factors, including high logging costs, the punishing impact of softwood lumber tariffs and growing popularity of wood substitutes, are creating difficulties for the cedar industry.

In the past three years, it may have lost up to 30 per cent of its market share to wood substitutes, industry officials say.

U.S. tariffs on softwood lumber have been the biggest headache for Canadian producers.

They have had to pay duties averaging 27.2 per cent on U.S.-bound shipments that are sold for an average of three times the price of dimension lumber.

"The duties are a real killer for cedar producers," said Stephen Crombie, a spokesman for International Forest Products Ltd., which operates a cedar mill in Maple Ridge, B.C.

As they try to pass on the duty to customers by raising prices, U.S. makers of wood substitutes such as Trex and Crane Plastics Holding Co. are taking market share away from cedar.

From a standing start in 1996, for example, Trex has increased its annual sales of composite replacement decks to $200-million. It recently signed a U.S. distribution deal with Atlanta-based Home Depot Inc.

Veteran cedar industry officials say companies such as Trex are succeeding by creating the perception, whether it is accurate or not, that wood tends to rot and requires a lot more maintenance.

"That may not necessarily be true," said Irwin Kullar, president of City Lumber Sales, a cedar lumber remanufacturer based in Surrey, B.C. "But that is the perception out there.''

Companies such as Trex also benefit from the perception that composites have less impact on the environment than wood and are worth the additional cost at the store.

"Alternative decking is still more expensive than cedar but the gap has narrowed so the trade up is affordable for the customer," said Nick Cowling, a spokesman for Home Depot.

The resulting loss of market share is changing the economics of the B.C.'s coastal forest sector, reducing the value of cedar logs and rendering timber stands in coastal B.C. uneconomic to log.

Still, industry officials insist cedar can regain some of what it has lost if the U.S. government agrees to withdraw punitive trade duties on softwood lumber.

"Cedar is a very good business if we can get the softwood issue dealt with," Mr. Crombie said.

Other officials say the cedar industry would benefit from a consolidation trend that is sweeping B.C., but which has left the coastal forest sector largely untouched.

"You have too many mills producing too much wood when the market doesn't need it," Mr. Kullar said. "There is too much production for the demand out there, pure and simple."

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