Demand for Christmas Trees Surges as Supply Drops

The display of Christmas trees has been an American tradition for decades. But with the increased popularity of artificial trees in the 1980s and 1990s, how are natural Christmas tree producers faring?

Nationwide, Christmas tree purchases have moved steadily upward in recent years. According to a consumer survey conducted by Harris Interactive, the purchase of real and artificial trees grew from 38.4 million trees in 2015 to 46 million last year.

But the supply of natural Christmas trees has dropped in past few years. The reason for the tight market: the Great Recession. The 10-year lag between planting and tree harvest, plus low sales a decade ago, meant there was less land and income for farmers to plant new seedlings.

This year, local tree farmers say sales are up, and national Christmas tree advocates say the tight tree market stands to help farmers who previously faced shrinking margins.

Joe Hensler manages Hensler's Nursery in Hamlet, Ind., a family-owned tree farm founded in 1953. He said sales have jumped by roughly 6 percent to 7 percent as compared with last season.

"I would say it's been one of our better years," Hensler said. "It's been a really strong season."

Return customers are always part of a Christmas tree farm's seasonal visitors, but Hensler said the draw of having a special Christmas experience attracts young families.

"We always say we're more than just trying to sell a tree," Hensler said. "We try to create a family experience."

With Santa and Mrs. Claus, a petting zoo, wreaths and a choose-and-cut section, Hensler said he hopes to offer a different experience than department stores. And every year, there's more customers at the farm for the first time.

"You can always tell they're new when they ask you 'Where do you pay? Where do you get a saw?'" he said.

Rhonda Dudeck, who co-owns Dudeck's Pine Country in Rolling Prairie with her husband, Greg, said she thinks a shortage of big trees this year has helped their business gain new customers.

"We've seen quite a few new people this year," Dudeck said. "My customers are saying the places they normally go just don't have the selection and height."

The 56-year-old family-owned farm has also done well in recent years.

"I'd say we had about a 10 percent increase in sales and about a 5 percent increase so far this season," Dudeck said.

Danica Abegg and her family have been coming to Dudeck's Pine Country to buy a 17-foot tree for eight years, except for last year. In 2016, her family used an artificial tree, a gift from Abegg's father.

"My family was very disappointed," Abegg said. "So this year, we're going back to buying a real tree."

With demand increasing locally, natural tree supply nationwide faces a continued slump. According to the U.S. Department of Agriculture's 2014 Census of Horticultural Specialties, the supply of available Christmas trees is expected to shrink over the next three years.

The National Christmas Tree Association, a trade organization advocating for Christmas tree growers, sees that decrease in tree supply as a boon for tree farmers. Doug Hundley, a lifelong Christmas tree grower in North Carolina and spokesperson for the NCTS, said the market has been difficult for tree farmers for more than a decade.

"Prices did not rise at all for a good 15 of the last 20 years," Hundley said. "We had some discouraging times and people were getting out of the business, doubting whether they wanted to stay in it."

The long period between planting and harvest can make predicting demand difficult for Christmas tree farmers.

"Can you imagine being a farmer and growing a crop that you don't sell for seven to 10 years?" Hundley said. "It's always been very challenging, and now we no longer have a glut of Christmas trees."

The result of the tighter market means more money out of pocket to purchase a natural Christmas tree, with prices increasing by about 7 percent to 8 percent per year. But Hundley said as the economy continues to improve, consumers should understand that by spending that extra cash, they're benefiting their local farmers, instead of large manufacturers of artificial trees.

"You should feel good about buying a real tree, because you're supporting American agriculture and American farmers," Hundley said. "One-hundred percent of Christmas trees sold in North America are grown in North America."

A new social media campaign by the association seeks to convince millennial consumers that real trees are the more responsible purchase, both environmentally and economically, with a new website itschristmaskeepitreal.com.

"We know that perhaps the better way to reach the millennial group is through social media," Hundley said. "We don't have enough funds to advertise on TV so we're trying to do it more through the social media and online."

But as real tree growers see better sales and optimism for the future, sales of artificial trees have also seen a bump.

Rachel Sammons, an assistant store manager at the Mishawaka Home Depot, said natural Christmas tree sales have been about average, but artificial trees have been flying off the shelves.

"Sales have been up on artificial Christmas trees, they've been selling like crazy this year," Sammons said. "We actually got another shipment of them this week, which is much later in the season than we'd normally need."

The American Christmas Tree Association, a different trade organization that advocates for both real and artificial trees, recently released a Nielsen survey that said of American families that display Christmas trees, 19 percent will display a real one, while 81 percent of will display an artificial tree.

In North Liberty, Greg and Julie Cinal can't say whether sales are significantly higher at their Liberty Christmas Tree Farm. That's because it's only their second season selling trees.

"We've been growing for 10, 11 years," Greg said. "It's kind of a hobby farm for us, we had always enjoyed going out and cutting down trees, but there was just less and less of them out there."

The sales representative and his schoolteacher wife planted trees a decade ago, and are now reaping the benefits of their long-term investment.

"The biggest thrill about having a Christmas tree farm is seeing all the families come out with the little ones, see the joy of cutting down a tree," Greg said. "It's what people did with their parents, people are getting back to their comfort zone. People really enjoy that nostalgia."

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