Demand decreases as construction slows, but engineered wood products look to increase market share.
Engineered wood products aren’t flashy. Homeowners don’t get excited about the latest innovation in glulam beams or LSL boards. But there’s no denying the importance these workhorse products have in shaping construction in both residential and commercial projects.
While the use of engineered wood products is growing in remodeling and commercial work, the demand for EWP is still closely tied to new housing starts. As that market goes, so goes EWP. With new starts and building permits running below 2018 levels for most of the year—and forecast to remain on that pace—that means a relatively level year for EWP sales.
“Engineered wood product sales are expected to be relatively flat to down slightly compared to 2018,” says Joe Elling, market research director for APA – The Engineered Wood Association. “The primary reason is that housing starts in the U.S. are on track to be down in 2019. In 2018 housing starts totaled 1.24 million units. The forecast calls for starts at 1.23 million units, with single-family starts at 850,000, compared to 870,600 in 2018. The use of engineered wood products in residential repair and remodeling is projected to grow 2%.”
Consistency, flexibility address construction challenges
Even as construction slows, though, there is an opportunity for engineered wood to grab market share. EWP can offer several benefits to builders, remodelers and designers, manufacturers say, that should make it more attractive to those industry professionals.
“As more and more builders want stronger and stiffer floors for their homeowners, one key ingredient of this is engineered wood,” says Kelly Harmon, LP Building Solutions OSB/ EWP national product manager. “Open floor plans along with heavier concentration loads fare well for predictable engineered wood as well. Code changes in certain areas of the country also can help drive builders to use EWP, so all of this coupled together can drive a higher demand for EWP which I believe we’ll continue to see increase.”
Engineered wood saves builders time and money, says Mike McCollum, director of Roseburg’s engineered wood business.
“Engineered wood products offer consistent and predictable performance for the most demanding applications,” he says. “LVL headers provide quality, strength and predictable performance in a heavy load carrying beam or header situation. Engineered wood is produced in lengths as long as 66′, and can be custom cut by the lumber dealer to fit each application. This results in much less waste on the jobsite, saving time and money for the builder, and ultimately for the homebuyer.”
As with most construction product categories, the engineered wood market is being affected by the labor shortage. The scarcity of skilled construction labor is inhibiting the ability of builders and developers to start new projects, Elling says, negatively impacting the demand for engineered wood products.
At the same time, manufacturers say that their products can play an important role in addressing those issues. The growth of off-site construction and need for predictable, consistent products for work on-site make engineered wood a natural fit.
“If you order a piece of material, you’re going to get that material size,” says Dennis Bott, director of commercial business for Boise Cascade. “For planning and doing things in an off-site facility, prefabricating it, getting it out to the field, there are inherent benefits with engineered lumber. The sizes are manufactured specifically for floor systems or beams and you’re getting what you’re ordering. You don’t have to worry about wane, or crook, or knots, or things not really lining up.”
Doug Asano, Huber Engineered Woods vice president of sales and marketing, echoed the importance of that predictability.
“When builders choose high-quality engineered wood panels, they will see a few major differences,” he says. “Primarily, they will notice better and more consistent manufacturing tolerances, advanced moisture resistance and enhanced strength and stiffness properties.”
That need for consistency is only going to grow in importance in the coming years as off-site construction increases, says Chris Webb, general manager, engineered wood product sales, Anthony Forest Products.
“It’s kind of small but it’s a growing segment where engineered wood products fit in that automated environment because they’re uniform and they’re reliable and they’re dimensionally stable,” Webb says. “That’s something we’re going to probably see more and more of over the next four or five years—automated construction.”
Several manufacturers also noted the importance that price stability brings to the market. That helps builders be more confident in their pricing as they plan out projects.
“Another aspect of consistency is engineered wood is not subject to the same kind of volatility that you’d see in a commodity market and so there’s consistency there as well,” says Ross Thielen, director of ELP sales for Weyerhaeuser. “In large part, we work very hard to maintain a consistent supply to our customers through our distribution channel, which, some of that’s internal Weyerhaeuser distribution and we also utilize independent distributors in some markets. So that’s the consistency piece.”
At the same time, engineered wood products offer a flexibility that can help builders develop the homes they need to meet market demand.
“Adaptable is the other word I think that will resonate with builders,” Thielen says. “In a time like this year where we hear a lot about affordability, the way we go to market through our dealer network, we’re well suited to help a builder modify their plans and use the right amount of materials to build a floor that it might have two foot less in one dimension than the same model did last year, because the builder’s chosen to modify their blueprint.”
Those benefits can help builders reduce costs, even when the initial price tag may seem higher.
“There is a misconception that it is more expensive to frame with engineered lumber when in reality, engineered lumber is a quality product with less waste, better performance and fewer callbacks,” explains Craig McDonald, director – EWP for BlueLinx. “While the initial cost comparison between an I-joist and a 2x is higher, the completed installed cost coupled with the performance of the structure provides a much better value for both the homeowner and builder.”
Consumers are also looking for more sustainable products in their homes these days, and engineered wood fits right into that message, Anthony Forest Products’ Webb says.
“Most manufacturers now have vertically integrated their supply chain with their raw materials and so they most all have technology in place to optimize the wood resources efficiently, basically utilizing every part of the tree,” he says. “That’s something a builder could go back to a consumer with and say engineered wood products are a good choice for the environment.” Builders are also finding new applications for engineered wood products. Most notably, the mass timber market in commercial projects is increasing thanks to the International Code Council’s approval of wood buildings up to 18 stories in the 2021 International Building Code.
“It’s kind of an evolving market right now,” Boise Cascade’s Bott says. “We’re seeing our products used in lieu of steel and concrete. What’s good about engineered wood products is that it’s not only more resource efficient, but it’s also a stronger product than dimensional lumber. When a customer wants a bigger grid system, let’s say in a commercial building, well your beams have to be stronger to span further. So engineered wood, because it’s stronger and more stable and more true, lends itself into these newer type of construction categories.” LP is also seeing laminated strand lumber being used in more wall framing and header applications.
“I believe this is due to LSL’s straightness and cost-effectiveness,” Harmon says. “Targeted wall framing with LSL in certain critical areas (e.g. kitchens, baths, vaulted walls, etc.) is an absolute necessity when the builders and homeowners want a perfectly straight wall.
We have quite a few builders who build exclusively with LSL in all areas of the home, but more commonly builders use LSL wall framing in ‘targeted zones’ of the home.”
LSL used in header applications not only provides the window/door a strong member overhead to carry the load, but it can be a potential cost-saving solution as well, Harmon says.
“For instance, if you add up the components that most builders use for headers (2×10, OSB, 2×4, nails) and replace it with an LSL header that typically is smaller in depth (possibly 3-1/2″ x 7-1/4″), it can potentially save money on the header itself as well as provide a better product with lifetime warranty,” she says.
More choices/availability for engineered wood products
Improvements in engineered wood products tend to be incremental. That has led many companies to focus on bringing more efficiency to the market in their manufacturing and distribution models as well.
Over the past year, BlueLinx has expanded its onCENTER line into more locations and increased the breadth of products which include I-Joist, LVL, LSL, Glulam, AFL and trimmable floor trusses.
“Our focus is to partner with our dealers to solidify mutual relationships with the builder,” says Craig McDonald, director – EWP. “Today we are leveraging our logistics expertise with a maniacal focus on market growth. When coupled with the breadth of our onCENTER product offering and technical expertise we provide a level of service second to none. We have the broadest distribution network to the dealer community with over 50 distribution centers. The service and support behind our products make onCENTER stand out from competitive brands.”
Roseburg is in the process of building a second engineered wood facility in Chester, S.C., that it says will be the most technologically advanced and most efficient, low-cost LVL facility in the world, with the highest-capacity continuous press on Earth.
“Our company exists ‘To make lives better from the ground up,’” McCollum says. “This statement can be interpreted in many ways, but what it means to us is this: We care for the land on which we plant our trees. We care for our trees throughout their lifecycle to create the highest value to each of our mills, while protecting the soil, water and air in our communities. Our lumber, plywood, composite panel, engineered wood, and chip facilities use that valuable and sustainable fiber in the most efficient and value-adding manner. Nothing is wasted; everything is used to make something or to produce energy.”
LP recently introduced its new LP WeatherLogic Air & Water Barrier system. “As architects and engineers implement building science practices to develop tighter homes to meet energy codes, three unique building envelopes need to be considered: thermal, air and moisture,” Harmon says. “Each works independently to prohibit the transmission of one element. However, the homeowner will have the best longterm results when the home is designed, engineered and built as a system rather than as individual components. Likewise, builders will see value if they take a value-engineering approach to seeing the home as a system.”
The LP WeatherLogic Air & Water Barrier system consists of a structural OSB panel with an integrated, weather-resistant overlay and the LP WeatherLogic Seam & Flashing Tape, a specially formulated acrylic tape with squeegee for ease of installation.
“Our broad product portfolio is something that makes LP Building Solutions unique,” Harmon says. “We carry a full framing, sheathing and siding portfolio under one roof. We don’t have any competitors that can claim that and offer that continuity to their customers. This allows us to combine products to offer real solutions.”
While not new products, Anthony Forest Products is seeing increased interest in its glulam beams and columns.
The Power Preserved Glulam beam is a pressure-treated beam for exterior applications, which people are using in more decks as the demand for outdoor living projects remains strong.
The Power Preserved Column is gaining popularity as a part of the mass timber framing systems in larger commercial or multi-family applications.
“It’s a great complement to [that] evolving market trend,” Webb says. “They’re also a key component just of residential construction as well. We have all these engineered wood products to hold up the floors and the roofs and everything else and historically they’re sitting on a stud pack or some built-up dimensional lumber and so you get some crushing and so with our column, it’s a perfect replacement. You just sit a Power Beam or some other structural beam on it and it connects very simply.”
Huber is focused on emphasizing quality that it can deliver to its dealer and builder partners.
“We start with superior quality from the mill, superior performance in the field and superior service from our team,” Asano says. “We are dedicated to solving common issues to make the jobs of trade professionals easier and drive the industry forward. No matter the product, we’re committed to find- ing solutions that will result in more resilient, durable structures that will last for years to come. We spend time discussing real jobsite needs with channel partners to lead our innovation process.”
Huber’s ZIP System building enclosures introduced six new flashing tape and stretch tape sizes this year. The full sealing solutions portfolio now includes five ZIP System flashing tapes and five ZIP System stretch tape options. In- creasing the options of tape in different lengths and widths gives builders the discretion to find the best fit for their job and application to further ensure ZIP System roof and wall assemblies help them achieve fast, reliable tight, dry enclosures, Asano says.
Weyerhaeuser maintains control over the entire process, sourcing materials from timberlands it owns or manages, while also offering a full range of engineered wood products, including I-joists, TJI joists and beams. Those factors make it easier for builders and dealers to get the products they need, Thielen says.
“That allows us to equip the dealer with the full range of rectangular products they would need to meet demands of their customers,” he says. “That sets us apart, as well as the fact that we invest, I think more than anybody, in field support. That includes our territory managers in market as well as we still maintain an in-house engineering group that provides technical support to customers.”
Another important part of Weyerhaeuser’s emphasis on service is its NextPhase Site Solutions, designed to make dealers more efficient and help them address jobsite issues.
“The precision cutting, labeling of individual members that matches a framing plan, cutting of holes, all those solutions that we’ve developed fall under an umbrella we call NextPhase Site Solutions that we offer our dealer network,” Thielen says. “A dealer can get involved in that in something as simple as a cross cut saw, all the way through to batching multiple jobs through a high-speed saw that does cutting, labeling, and all in one operation. Those solutions have been around for a number of years, and we continue to invest and make them more capable of enabling the dealer to offer solutions to the builder.”
While engineered wood products have been around for decades, there is still plenty that dealers can do to help educate their customers on the benefits.
“Our most successful dealers are
well-versed in understanding the industry, their customers’ needs, and how/when engineered wood products can offer a sound solution to a job- site challenge,” says Kelly Lalonde, LP Building Solutions territory sales man- ager (Pacific Northwest). “Dealers can sell more of our products by educating their sales team along those same lines. Demand is driven when dealers really inform their customers of the benefits of using engineered wood.”
With a labor force that may be less experienced, builders need to rely on their dealer partners more than ever when it comes to product knowledge.
“Codes and building practices are becoming increasingly complex and changing ever faster, and homeowners are better educated and aware of what goes into their homes,” Huber’s Asano says. “All of these factors can be overwhelming to a builder, and those dealers who can position themselves as experts and sources of education for builders will continue to win. Dealers should look to partner with building product manufacturers who act as a true extension of your team. Look for partners who of- fer periodic product trainings for your employees, technical resources for builders to rely on, and warranties that they will stand behind.”
Anthony Forest Products’ Bott agrees, noting that the more a dealer’s team knows about a product, the more likely they are to be able to sell it.
“The first thing is to make sure the dealers fully embrace an education platform of some degree. And that could be working with their key suppliers and manufacturers, or doing something in-house where they’re actively engaged in talking with architects and engineers, and letting that end of the specification community see what they do as a supplier,” he says. “Because then what happens is those specifiers will be more likely to refer potential new clients to that particular lumberyard.”
The second piece of that relationship is dealers making it easier for builders to do business with them. That design support and service can be even more important than the products themselves.
“It’s about partnering with the builder to provide services that are important to their success,” BlueLinx’s McDonald says. “Prompt shipping of product to the jobsite is just the ante into the game. The truly successful dealers are critical business partners providing design options, new product options and field support.”
Many of the engineered lumber companies offer various programs that allow dealers to take a set of plans, model it and export it to a saw system. Those programs can help builders work around labor shortages.
“Design support is basically an expectation these days,” Weyerhaeuser’s Thielen says. “Going beyond that though—offering the materials cut to the nearest foot or even precision cut, offering the materials labeled, precut with holes already in the materials where the HVAC runs will go. You can progress through this via a process to where more and more work is done at the dealer level. It minimizes the amount of labor that’s required on the job. There are quite a few markets where jobsite labor is the constraint, and a dealer that has the ability to offer that spectrum of service, where labor is in short supply, provides them an opportunity to grow their sales.”
Jonathan Sweet is a Minneapolis-based writer and editor who has covered the construction industry for both consumer and trade publications for more than 20 years.