News and Analysis

Supply Chain Bottlenecks May Cause Christmas Tree Shortage, Report Says

   DailyWire.com
Presents Under the Christmas Tree
DNY59 via Getty Images

Americans may have difficulty buying a Christmas tree due to supply chain bottlenecks.

CNBC’s Amanda Macias spoke to several executives involved in the process of importing and wholesaling Christmas trees and holiday-related goods. They expect low tree availability and high consumer demand in the weeks before Christmas.

“The demand this year is going to be extremely strong and so I think from a consumer perspective people definitely shouldn’t wait,” National Tree Company CEO Chris Butler told the outlet. “Consumers should buy now because by the time we get to Thanksgiving, which is a peak week for us, I think there’s going to be a lot of empty shelves. We’re seeing pretty strong growth right now already versus last year and so, I do think that we’re in for a big, big season this year.”

Butler added that shipping costs have skyrocketed over the past several months.

“Since May, due to backups from Covid-19, it’s been a real struggle to just get containers,” Butler remarked. “Last year we paid $2,000 to $3,000 for containers and this year we’re paying in the region of $20,000. We decided that we would pay the exorbitant rates that were being charged to make sure we got as many containers as we could.”

“If you see something you like, buy it,” American Christmas Tree Association executive director Jami Warner advised. “The quantities this year will be fewer than usual and of course the consumer will have to take the brunt of higher prices. They won’t be hugely higher but they will be higher.”

The supply of trees has also been affected by extreme weather in states like Oregon and Washington — a phenomenon that Macias attributed to climate change.

“Floods, heat waves, wildfires and smoke from the fires has really, really hampered growers in the Pacific Northwest and the Midwest,” Warner added.

As The Daily Wire previously reported, shipping vessels carrying consumer goods from Asian markets are idling in the Pacific Ocean as the United States deals with labor shortages. There are 111 container ships waiting to unload in the ports of Los Angeles and Long Beach, which process a significant portion of imports.

In a recent Wall Street Journal poll of top economists, approximately half said that supply chain bottlenecks are “the biggest threat to economic growth in the next twelve to eighteen months” — with 45% estimating that the problems will not be solved until the second half of 2022.

Some large firms, however, have managed to bypass the supply chain problems.

On Tuesday, Walmart announced a 9.2% increase in sales between its third quarters in 2020 and 2021; total revenue likewise increased 4.3% to $140.5 billion. The retail giant was able to charter its own vessels to circumnavigate clogged ports — as a result, its inventories are 11.5% higher ahead of the holiday shopping season.

“Our momentum continues with strong sales and profit growth globally. Our omni-channel focus is pushing digital penetration to record levels,” explained Walmart chief executive Doug McMillon. “We gained market share in grocery in the U.S., and more customers and members are returning to our stores and clubs around the world. Looking ahead, we have the people, the products, and the prices to deliver a great holiday season for our customers and members.”

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