Written by: Nicole H.
Christmas Tree Craze
It is not hard to find a Christmas tree on display in the holiday season throughout December because it is a well known tradition and it is a tree that means more than just wood and pine needles. Christmas trees are sold in perfect competition, meaning there is little product differentiation, there are many producers, in this case farmers, and the market price is beyond the control of individual sellers. They are price-takers. Christmas tree production happens all over the world, whether it is artificial or a farm-grown evergreen. As for farm-grown trees, the United States is a leading producer, along with Germany and Canada. In fact, Christmas trees are grown in all 50 states, Oregon with the most land devoted to Christmas tree production. During the Christmas season here in the US, each year around 35-40 million trees are sold. Unfortunately, the average tree takes about 6-10 years to fully mature and harvest so each year around 73 million are planted. In the past there has been an oversupply of natural trees in the United States. In the late 1980s through the mid 1990s, prices decreased because of the major supply. “Christmas trees sold for around $5 as opposed to the usual $18-30 each” (Christmas). The use of natural trees decreased, as the use of artificial trees continued to increase. As for today, we see a rise in price of our Christmas trees this season. According to Bryan Zellner who has been in the tree business for years, there are fewer trees this year than last year. Although shortage has happened before, there are even fewer this year than we have seen in previous years. Due to the decrease in supply, prices have increased. Therefore, only the consumers willing to pay this higher price will have a tree in their home. This price increase is pretty significant and according to Zellner they have increased between 10 and 15 percent. The reason for this shortage goes back about a decade ago when this generation’s trees were planted to grow and mature. At that time, the demand for Christmas trees was very low, so as a result growers planted fewer seedlings because of lack of profits. Now in 2017, we are left with a short supply, but a high demand. Another factor that contributed to the supply of trees are some wild fires that occurred in Oregon and droughts that occurred in North Carolina, two states with large tree production. As a result of the decrease in profits over the years, many firms left the industry. Just in five years between 2010 and 2015, the number of growers dropped about 215 growers. As the prices increase this year, I predict that the artificial tree demand will increase as it is a substitute for natural trees. I do not think that there will be a decrease in demand for complements of natural trees because things like lights and ornaments and tree skirts are essential for both natural and artificial. If you do decide to go the natural route, do not wait to get your tree because you may be left with a picked over selection.
Burden, Dan. “Christmas Tree Profile.” Agricultural Marketing Resource Center, www.agmrc.org/commodities-products/forestry/christmas-tree-profile/.
“Christmas Tree Production.” Wikipedia, Wikimedia Foundation, 30 Aug. 2017, en.wikipedia.org/wiki/Christmas_tree_production.
Makaula, Walter. “Why Christmas Trees Are More Expensive This Year.” KCRA, KCRA, 25 Nov. 2017, www.kcra.com/article/why-christmas-trees-are-more-expensive-this-year/13925655.
“Why Your Christmas Tree Will Cost More This Year.” Southern California Public Radio, Southern California Public Radio, 24 Nov. 2017, www.scpr.org/news/2017/11/24/78110/why-your-christmas-tree-will-cost-more-this-year/.