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This is most likely due to some form of larvae that is buried inside of your cedar siding. The most likely culprit is Carpenter bees. They are black and yellow striped and for the most part not much of a threat to sting you (the female is the only one with a stinger). The male burrows into the siding and the female will lay her eggs inside of the tunnels. When they hatch, the larvae will burrow still further throughout the siding leaving perfectly circular tunnels. They LOVE cedar siding! The woodpeckers are responding to the vibration they're feeling from the larvae moving within their tunnels. They're trying to dig the larvae out. There are a number of ways to address this issue, one is more labor intensive while the other is a bit more expensive.
The do-it-yourself approach would be to buy some wasp and hornet spray from lowes or home depot (the one that is sold with the long flexible tube. Simply locate ALL of the entry holes through out the siding and spray the pesticide up and into the tunnels. The adult bees inside will come shooting out, while the larvae will be killed outright. Next, you'll want to fill all of both the entrance and exit holes using "Great Stuff" an expandable foam. This will keep the remaining adults from reentering the holes and laying more eggs.
The second more expensive approach is to have an exterminator come out and spray for the carpenter bees. They'll basically be doing the same things that you could do yourself, but it'll obviously be less labor intensive.
Best wishes, Dori
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