The photo looks more like a surface deposit, unless I am looking at it wrong. If that's the case then is likely some sort of insect egg mass - gypsy moth or maybe lantern fly, or just a fungus? I have seen fungus/mushrooms growing on composite material before, don't forget, it's made of wood fibers glued together.

Scrape it off and/or maybe apply some diluted bleach.

It doesn't look like a surface deposit to me. Some wasps will scrape at old dry wood to make their paper nests. The damage looks like this. You can hear them gnawing if you see one at it and are very quiet.

Woodpecker damage can start out looking this way.

Its not surface deposit.

Is there something i can do to deter this activity from worsening?

Personally I'd ignore it. Wasps won't do structural damage and the kids should be fascinated if you show them how insects can make paper. Just tell them to check nobody's at work there before climbing on the structure. https://chic-teak.co.uk/blogs/posts/why-do-wasps-like-my-teak-garden-furniture

But if you really don't want these useful insects (they are huge predators of pests) the linked article has advice on removal.