This year, the festive spirit might come with a slightly higher price tag, as international trade disputes are pushing up the cost of synthetic Christmas trees and holiday ornaments throughout the United States. Importers and merchants are bracing for a season characterized by increased expenses, restricted availability, and careful consumer expenditures, as tariffs redefine the holiday retail landscape.
Holiday decorations face increasing price concerns
Artificial Christmas trees, a common sight in numerous homes, are projected to be 10% to 20% pricier compared to the previous year. This increase is primarily due to tariffs imposed on imported items, with decorative lighting experiencing the most significant hikes—in certain instances, as much as 63%. Given that most Christmas decorations for the general market have historically been produced abroad, these tariffs have generated widespread consequences across the sector.
Manufacturing such products domestically is not a feasible solution for most companies. The high cost of setting up production facilities, purchasing massive equipment, and training workers would drastically increase retail prices. According to Mac Harman, founder and CEO of Balsam Hill, producing trees in the United States could push the price of an $800 tree to nearly $3,000.
“The equipment needed to produce artificial trees can span the size of a football field,” Harman explained, noting that much of the machinery is fixed and cannot easily be transported. Additionally, prelit trees — the most popular option among consumers — require extensive manual labor to string the lights, a process typically done by hand by skilled workers in Asia.
A global supply chain under strain
For many years, nations such as Thailand and China have been the primary producers of Christmas ornaments. Currently, approximately 90% of the globe’s commercially available festive decorations are manufactured in China. However, this leading position has faced challenges due to increasing U.S. tariffs on products from China.
Anticipating these challenges, Balsam Hill began diversifying its supply chain after the 2016 presidential election, shifting part of its production to other countries. Harman estimates that roughly one-third of the company’s products now come from outside China. Even with these changes, tariffs ranging from 20% to 30% have added considerable costs, forcing many importers to reduce inventory to manage expenses.
The overall supply of artificial trees in the United States is projected to decline by about 15% this year, which could limit choices for shoppers who wait until later in the season. Major retailers like Costco have also scaled back their holiday décor categories, with CEO Ron Vachris acknowledging that the company has “thinned down” its offerings in light of uncertain trade conditions.
Despite these challenges, the National Retail Federation (NRF) anticipates a strong retail period. Overall holiday expenditures in the U.S. are projected to exceed $1 trillion for the inaugural time, with the typical shopper intending to allocate around $270 towards non-gift purchases like decorations, gift wrap, and greeting cards.
Living trees are unaffected by duties
While artificial tree prices continue to climb, live trees are expected to remain unaffected. Most natural Christmas trees sold in the United States are grown domestically, and those imported from Canada are exempt from tariffs under the U.S.-Mexico-Canada trade agreement. This protection comes despite new duties on Canadian lumber entering the country.
Based on information from the Real Christmas Tree Board, a survey revealed that 84% of cultivators do not intend to increase their prices this year. Marsha Gray, the executive director of the board, highlighted the robust standing of live tree growers, noting their substantial stock and thriving harvests. She remarked, “We are among the select industries that can confidently state we are not concerned with tariffs.”
Given that a Christmas tree takes nearly a decade to mature, the live tree supply remains insulated from short-term economic shifts. Gray noted that current stock levels are the strongest seen in over ten years, ensuring that families who prefer the scent and tradition of a real tree will have plenty of options at stable prices.
Holiday optimism amid economic uncertainty
Even as tariffs and global supply chain issues weigh on artificial tree prices, consumer sentiment remains surprisingly steady. The NRF expects many households to adjust their spending habits rather than cut back entirely, with some opting for smaller trees or fewer decorations while still keeping the festive spirit alive.
Retail experts also note that early shopping trends suggest Americans are planning ahead to avoid last-minute shortages. “Every year, no matter the challenges, the holiday season finds its rhythm,” said NRF President Matthew Shay. “People save for it, plan for it, and make it a priority.”
In conclusion, although tariffs might slightly increase the cost of Christmas for individuals who favor the ease of an artificial tree, the lasting charm of festive customs persistently prevails. Regardless of whether it’s the gentle radiance of fairy lights or the crisp aroma of pine, households nationwide are getting ready to commemorate – demonstrating that even financial obstacles cannot diminish the holiday cheer.
