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If you’re planning on buying a Christmas tree this year, start thinking about it now — and maybe put some money aside.
Supply-chain disruptions and global inflation have affected the supply and prices of Christmas trees this year, both artificial and real ones, industry experts said.
With inflation at a 40-year high and prices of consumer goods and services up 8.2% in September compared with last year, Americans are cutting back on discretionary spending and dipping into savings to pay their bills.
“‘The real-Christmas-tree industry is bigger than any one farm, retailer or region — and we’ve never run out of trees.’”
— Marsha Gray, executive director of the Real Christmas Tree Board
“Of course, prices vary based on location and type of tree,” Tim O’Connor, executive director of the National Christmas Tree Association, told MarketWatch.
In addition to the potential increase in wholesale prices, other costs including transportation, rent, utilities and labor could further push up the cost of trees this year, Balsam Brands’ Harman said.
Some good news: The supply of real trees should be broadly in line with last year, said Marsha Gray, executive director of the Real Christmas Tree Board.
Although there have been reports of extreme weather affecting tree crops, the Christmas-tree industry is big and farms are scattered, Gray told MarketWatch. What’s more, farmers use long-term strategies to account for short-term weather disruptions.
The heat wave in the Pacific Northwest last year, for example, affected seedlings and scorched some tree branches, Gray said, but because of the 8- to 10-year life cycle of the crop, farmers were able to manage their inventories to prevent a shortage.
“The real-Christmas-tree industry is bigger than any one farm, retailer or region — and we’ve never run out of trees,” she said.
Last year, some artificial trees arrived at retailers after Christmas because of pandemic-related supply-chain disruptions.
MarketWatch photo illustration/iStockphoto
If you’re buying an artificial tree, shop early
Supply-chain issues could, however, disrupt the artificial-tree market this year, Harman said.
Last year, boxes of artificial Christmas trees arrived at retailers after Christmas because of pandemic-related supply-chain disruptions. Since then, retailers have been storing trees in their distribution centers, “which is not what you want, because Christmas trees are bulky,” he added.
And it’s not just artificial trees. The inventory-to-sales ratio for general-merchandise stores reached a 15-year high in the second quarter, meaning retailers were losing money sitting on unsold supplies.
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