In this first volume of the Container Tree Nursery Manual, we 

provide information and guidance on how to start it all. How do 

you build a nursery from scratch and equip it? What are the 

processes involved in growing container seedlings? How do you 

manage the process and the people?

So you want to build a nursery. Do you really need to grow your 

own seedlings? Would you be better off buying from someone 

else? In chapter 1, we discuss some of the basic concepts and 

terminology of forest and conservation nurseries and planting 

stock.

Okay, you've decided that you are going to start a 

nursery. Now, where are you going to put it? In chapter 2, 

we discuss the considerations and site selection factors.

Now, you've found a good nursery site and are ready to plan 

your container nursery. In chapter 3, we present some of the 

terminology of structure design so that nursery developers can talk 

intelligently with greenhouse contractors and suppliers. We also 

show rough cost estimates for types of structures, refer developers 

to other good sources of technical information, and discuss 

considerations in laying out the nursery site.

You've got the basic nursery laid out and need to select the 

equipment and supplies to get your first crop started. In 

chapter 4, we present some of the basic concepts and 

terminology of environmental control and seedling production 

equipment so that you can commu nicate with suppliers. Then we 

present cost estimates for these type of equipment as well as 

referring developers to other good sources of technical 

information.

Now you've got the nursery infrastructure built and the 

equipment installed. How do you manage your people and the 

workflow? In chapter 5, we present some of the basic concepts of 

managing a container nursery, especially what makes them 

different from other businesses. We also discuss some of the 

problems that might arise the first couple of years and provide 

troubleshooting tips.

2

Contents

 1.1.1 Introduction 5

1.1.1.1 Terminology 5

 Seedlings 5

 Nurseries 8

1.1.1.2 Seedling quality is determined by outplanting 

performance 10

 Morphological specifications 11

 The nursery effect 12

 1.1.2 Sources of Planting Stock 14

 1.1.2.1 Purchasing seedlings 14

 Buying speculation stock 14

 Contracting for seedlings 14

1.1.2.2 Starting your own nursery 15

Bareroot nurseries 15

Container nurseries 15

Selecting the best alternative 15

1.1.3 Evaluating the Present Nursery Market 18

1.1.3.1 Demand 18

1.1.3.2 Competition 18

1.1.3.3 Price 19

1.1.4 Estimating Product Costs 20

1.1.4.1 Requirements of a container nursery system 20

1.1.4.2 Influence of nursery size and space utilization 20

1.1.4.3 Energy and transportation considerations 21

1.1.4.4 Balancing labor and equipment 22

1.1.5 Feasibility Assessment and 

Development Tactics 23

1.1.6 Summary 24

1.1.7 Literature Cited 25
1.1.1 Introduction

This chapter is written primarily for those who are thinking of 

starting a forest or conservation nursery. This introductory material 

will also be useful to foresters and other natural resource specialists 

who use plant materials. Both prospective nursery developers and 

seedling users need a basic understanding of nursery terminology 

and concepts. Nursery developers must carefully analyze whether it 

would be most advantageous to start a nursery or merely to 

purchase seedlings from someone else. If the decision is to develop 

a new nursery, then it is necessary to evaluate the present market, 

make some estimates of production costs, and perform a 

systematic analysis.

1.1.1.1 Terminology

Prospective nursery developers and seedling users should be 

familiar with nursery terminology. Many of these terms have been 

borrowed from horticulture, but others have developed within the 

forest nursery industry.

Seedlings. A seedling is a plant that has been grown from a 

seed. However, the term is often used loosely to refer to many 

types of nursery stock including transplants, rooted cuttings, and 

emblings (which are produced through micropropagation).

Stock type. Forest and conservation seedlings are traditionally 

divided into two basic stock types--bareroot seedlings and 

container seedlings--that describe how they were grown. Bareroot 

stock is typically grown in native soil in open fields (fig. 1.1.1A) and 

the

seedling is removed from the soil during harvesting (fig. 1.1.1 B). 

Container seedlings are grown in artificial growing media (fig. 

1.1.2A) in a controlled environment, such as a greenhouse, where 

growth-limiting factors can be manipulated (fig. 1.1.2B). Because 

the volume of growing medium is relatively small, the roots bind the 

medium into a cohesive plug by the time they are harvested (fig. 

1.1.2C). Although the seedlings are also called "containerized," 

"container-grown," or "plug" seedlings, we prefer the term 

container seedling because it is simple and definitive.

Another stock type is the transplant, which is a seedling that has 

been physically removed from its seedbed or container and is 

replanted in another location for additional growth. Traditionally, 

most transplants have been bareroot seedlings that are grown for 

1 or 2 years

Figure 1.1.1--Bareroot seedlings are grown in outdoor nursery 

beds in native soil and are subject to local weather conditions (A). 

After harvesting, they are stored and shipped for outplanting 

without soil around the root system (B).

Figure 1.1.2---Container seedlings are grown in a relatively small 

volume of artificial growing media (A) in a propagation environment 

designed to minimize factors that are potentially limiting to seedling 

growth (B). At the end of the growing season, container seedlings

are harvested with the root system and growing media forming a 

"plug" (C). Plug + 1 seedlings are started as small-volume 

container stock and are then transplanted to bareroot nursery beds 

and grown for another season (D).

and are replanted into a transplant bed and allowed to grow for 

another year or two. Transplanting produces more caliper and root 

growth compared to seedlings and, although they are more 

expensive, transplants are used on tough outplanting sites, 

especially where vegetative competition is a problem. Container 

transplants (fig. 1.1.2D) are a rather recent innovation in which 

container seedlings are replanted in bareroot beds for an additional 

period of growth (Hahn 1984). Miniplugs are grown in very small 

volume containers and are grown specifically for transplanting 

(Hahn 1990). Although they are typically transplanted into bareroot 

beds, miniplugs can easily be transplanted into a larger volume 

container.

A stock type name is a shorthand method of describing seedling 

morphology (Scagel and others 1993). Historically, a numerical 

designation has been used to describe both seedlings and 

transplants. The first number corresponds to the number of years in 

the seedbed or seed container, and the second number refers to 

the number of years in the transplant bed or container. Bareroot 

seedlings are generally produced in from 1 to 3 years (1 +0 to 3+0), 

and transplants (for example, 1 +1 or 2+1) can vary considerably 

depending on the species, climate, and nursery system. The sum 

of the two numbers gives the total number of years needed to 

produce that stock type.

There is no standard nomenclature for describing container 

seedlings. Because most container seedlings are grown in one 

season or less, they are generally defined by the type and volume 

of the growth container. For example, a "Styro 4" refers to a 

seedling that has been produced in a Styrofoam© block container 

with cells that are approximately 65 cm3 (4 in') in volume. Other 

regions use different terminology. In British Columbia, some 

container stock types are grown for more than 1 year and so their 

names include container

type, size, and length of growing period. For example, a PSB 313B 

1+0 seedling was grown for 1 year in a Styrofoam block container 

that has cells that are 3 cm (1 .2 inches) wide and 13 cm (5.1 

inches) deep (Scagel and others 1993). Container transplants are 

described by the number of years in the bareroot nursery, for 

example a plug-plus-one (P+1) transplant.

Container seedling customers should realize that, when ordering 

seedlings, stock type must be considered along with species and 

seed source. With the number of container sizes and cultural 

options, there is a wide variety of stock types from which to choose 

(fig. 1.1.3A). Each stock type has unique biological characteristics 

that affect seedling survival and growth after outplanting. Cost of 

production also varies with stock type, and the best choice will be a 

balance between cost and outplanting success. Several 

publications discuss different bareroot stock types and how they 

should be used in reforestation (Iverson 1984), and others have 

treated container stock types on a regional basis (Brissette and 

others 1991). Scagel and others (1993) provide an excellent 

discussion of the factors that should be considered in selecting 

stock types for outplanting sites in British Columbia. For example, 

because larger seedlings are needed to compete with brush 

competition and animal browsing on better outplanting sites, larger 

volume containers are specified in growing contracts (fig. 1.1.3B). A 

comprehensive treatment of container seedling stock types will be 

presented in volume six of this series, and their suitability for 

various outplanting sites will be treated in volume seven.

Seed source. One of the most important aspects of forest and 

conservation seedlings is that they are always identified by seed 

origin, with both geographical location (township-range-section or 

longitude-latitude) and elevation specified. A seed zone is a 

geographic area that is relatively similar in climate and soil and is 

described by a numerical code. For example, the forested areas of 

Arizona and New Mexico have been divided into 10 

physiographic-climatic regions that are then subdivided into 

collection zones that are about 80 km (50 miles) wide (fig. 1.1.4A). 

These seed zones are also stratified vertically by increments of 150 

m (500 feet) in elevation. A geographically diverse state like 

California can have over 80 different seed zones, with numerous 

elevation bands within each zone. All the seeds and cuttings that 

are collected in a particular area are labeled with that seed zone's 

code (fig. 1.1.4B).

7
Figure 1.1.3---Seedling quality is determined by conditions on the 

outplanting site, and a wide variety of container stock types are 

available (A). As site quality increases (higher soil moisture and 

fertility) on this British Columbia site, larger volume containers are 

specified that will produce larger seedlings (B) (modified from Scagel 

and others 7 993).

Unless progeny tests have shown otherwise, it is best to plant 

seedlings back into their zone of origin. Thus, most seedlings grown 

for forest and conservation purposes are ordered by species, stock 

type, and seed zone. For example, Douglas-fir (Pseudotsuga 

menziesii (Mirb.) Franco.) seedlings from the Cascade Mountains to 

the east of Portland, Oregon, could be ordered for a site at 600 m 

(2,000 feet) elevation in seed zone 452. When this seedling order is 

sown in the nursery, this information on species, seed zone, and 

elevation is included into a seed lot identification number (fig. 

1.1.4C). The seed lot number remains with this group of seedlings 

throughout their entire nursery tenure and is marked on the storage 

container when the seedlings are harvested for outplanting (fig. 

1.1.4D). The process is completed when the seedlings are planted 

back into the same general climatic region in which the seed was 

collected. The importance of proper source identification cannot be 

overstated. Seedlings perform best within

8

their seed zone, and many plantings have failed because the stock 

was poorly adapted to the outplanting environment. If a lot of 

seedlings loses its source code, nurseries often destroy the 

seedlings rather than have them outplanted in the wrong 

environment.

Nurseries. It is also important to define technical terms that 

describe nursery organization and layout.

For our purposes, the term container nursery will refer to any 

operation that grows plants in containers in some sorb of modified 

propagation environment. The container itself generates a unique 

edaphic environment and most forest nurseries use some type of 

artificial growing medium (see volume two of this series). The 

degree of modification of the ambient environment varies 

considerably from open growing compounds with no environmental 

controls except for irrigation and liquid fertilizer injection to a 

variety of different propagation structures
Figure 1.1.4-The origin of seed of forest and conservation species 

is recorded by numerical seed zones, as illustrated in this seed 

zone map of Arizona and New Mexico. Blank areas are 

agricultural, grassland, or desert and contain no native forest (A). 

"Source identified" seed (B) is a guarantee of seed orig=in and 

ensures that seedlings will be adapted to their outplanting site. 

The identity of different seed lots must be maintained at all times 

in the nursery (C) and when packed for shipment to the field (D).
(McDonald 1982). Fully enclosed greenhouses with the latest 

environmental control equipment can maximize seedling growth 

rates by creating an ideal environment with few limiting factors. 

There is no ideal type of container nursery; instead, nurseries 

reflect the local environment as well as the owner's experience 

and financial status. (A complete discussion of propagation 

environments and propagation structures is provided in chapter 3 

of this volume.)

A container tree nursery specializes in producing native and 

introduced plants for forestry or conservation purposes. 

Traditionally, these have been seedlings of commercial forest 

trees, but in recent years, a wide variety of different plant species 

are being produced including shrubs, grasses, and sedges (Landis 

and others 1993). A well-designed container tree nursery consists 

of seedling production areas and service buildings, such as a 

headhouse, seedling storage areas, and administrative buildings. 

These are all interconnected by an internal transportation system, 

consisting of roads and conveyors, that has been laid out to 

facilitate movement of seedlings and supplies. A nursery facility is 

a comprehensive term that describes the total nursery site 

including seedling production areas and support buildings. Some 

forest nurseries have both container facilities

and fields for producing bareroot seedlings and transplants. 

(Nursery propagation environments are discussed in chapter 3 and 

seedling production and environmental control equipment is 

discussed in chapter 4 of this volume.)

1.1.1.2 Seedling quality is determined by outplanting

 performance

One of the principal characteristics of forest and conservation 

nurseries is that their seedlings are typically planted in relatively 

harsh environments without irrigation or other subsequent care 

(fig. 1.1.5A). This differs markedly from seedlings from ornamental 

nurseries, which are planted in more favorable landscapes where 

they receive irrigation and fertilization at frequent intervals (fig. 

1.1.5B). This difference is significant

Figure 1.1.5---Seedlings planted in the forest must be capable of surviving and growing well without subsequent care (A). This contrasts 

sharply with ornamental and landscape stock, which receive postplanting care, including regular irrigation and fertilization (B).

10
Figure 1.1.6---Specifications for container seedlings include 

morphological measurements, traditionally shoot height and stem 

diameter (A). Seedling size and quality are greatly affected by 

nursery environment and cultural practices; for example, containers 

with larger volumes and lower growing density produce ponderosa 

pine seedlings with much larger stem diameter (B). (Modified from 

Scagel and others 1993.)

because the measure of seedling quality depends on the how the 

seedlings will be used-"fitness for purpose" (Ritchie 1984). This 

means that, although seedling quality is described at the nursery, it 

can only be proven on the outplanting site. There is no such thing 

as an "all-purpose" tree seedling. A "nice looking seedling" at the 

nursery will not survive and grow well on all sites.

Morphological specifications. Forest and conservation seedlings 

are described by traditional morphological dimensions (fig. 1.1.6A), 

and these terms are used by nursery personnel and seedling users. 

The most common dimensions are shoot height and stem diameter. 

Shoot height is the vertical distance from the growing medium to 

the tip of the terminal meristem or bud. Stem diameter, often called

"caliper" or "root collar diameter," is the diameter of the main stem 

at the base of the shoot.

Because it is measured in millimeters, stem diameter can vary 

significantly with the exact location of the measurement. Therefore, 

most nurseries measure caliper at a standard location, such as 1 

cm (0.4 inch) above the growing medium. All aspects of seedling 

morphology vary considerably between different sizes of 

containers, particularly with regards to container volume and 

growing density (fig. 1.1.6B).

Other seedling morphological specifications include root length, 

ovendry (OD) weight, and shoot-to-root (S:R) ratio (fig. 1.1.6A). 

Although they require destructive sampling, seedling dry weights 

are useful indices of crop development. The S:R ratio is a relative 

comparison of the size of the shoot to the root system and is 

sometimes specified by seedling users to match the stock type to 

conditions on the outplanting site.
The nursery effect. The physical appearance of any organism 

(its phenotype) is the result of its genetic makeup (its genotype), 

tempered by the environment in which it was raised:

Phenotype = genotype x environment

In forest and conservation nurseries, the phenotype of a seedling is 

a function of its genotype (seed source, origin of cutting, or cultivar) 

and the environment of the nursery in which it was grown. Actually, 

the nursery environment is a composite of its geographic location, 

the type of propagation facility, and the cultural practices used to 

raise the seedling (fig. 1.1.7A). When the same seed lot is grown at 

different nurseries, even in the same geographic area, seedling 

morphology can be visibly different (fig. 1.1.7B).

Container seedlings grown at different nurseries may also be 

physiologically different. This response has been called the 

nursery effect and is an example of environmental imprinting, by 

which seedlings are influenced by nursery site conditions or 

cultural practices. Nursery imprinting is evident in day-to-day 

nursery and reforestation activities. Foresters who have planted 

seedlings from the same seed source that were grown at different 

nurseries have noticed differences in survival and growth. One 

study in Alaska compared container Sitka spruce (Picea sitchensis 

(Bong.) Carr.) seedlings from a local nursery to others grown from 

the same seed source in an Idaho nursery (Zasada and others 

1990). The Idaho seedlings suffered significantly more animal 

browsing and frost damage the first several growing seasons 

compared to the local nursery stock. In another study with 

lodgepole pine (Pinus contorta Dougl. ex Loud.), Ying and others 

(1989) noted significant differences in outplanting performance 

from different nurseries but concluded that the effect is relatively 

short term (~15 years). Regardless, these differences may be 

enough to affect initial seedling establishment.

12

Figure 1.1.7---The physical appearance of a container seedling 

(phenotype) is a function of its genetic makeup (genotype) and the 

propagation environment (A). When the same seed lot of interior 

spruce ( Picea glauca x P. Engelmannii) was sown at 6 different 

nurseries, the seedlings exhibited obvious variation in height, foliage 

color, and degree of lateral branching (B). (B, from Scagel and 

others 7 993.)
Prospective nursery developers and seedling users must take all 

these facts into consideration when planning a nursery or deciding 

which kind of seedlings to buy (table 1.1.1). The best seedling for a 

particular project will depend on many factors: seed origin, nursery 

culture, seedling handling and storage facilities, planting implement, and environmental conditions on the outplanting site. 

Research and actual experience have shown, however, that 

certain sizes and stock types perform better on some sites than 

others. Seedling quality will be discussed in more detail in volume 

six of this series.

13
1.1.2 Sources of Planting Stock

When confronted with a regular demand for tree seedlings, many 

people think about starting their own nursery. Growing tree 

seedlings requires a concerted and sustained effort, however, and 

so all the pros and cons of starting a nursery should be considered 

(table 1.1.2). The principal benefit of having a nursery is that the 

quantity, quality, and availability of planting stock can be 

controlled. Much time must be devoted to developing a new 

nursery, however, and considerable capital investment will be 

required. The projected need for seedlings must be long enough to 

amortize the investment. Therefore, individuals or organizations 

that need a steady supply of seedlings should first consider 

purchasing stock from an established nursery.

1.1.2.1 Purchasing seedlings

There are a number of advantages to purchasing seedlings instead 

of starting a nursery. First and foremost, time and capital are 

available for other uses (table 1.1.2). Producing tree seedlings can 

be a risky business venture, and buying planting stock from other 

nurseries means that many of the risks and day-to-day hassles 

associated with growing seedlings can be avoided. Potential tree 

nursery developers should carefully observe other

operations already in the business and decide if the advantages 

of starting a nursery outweigh the disadvantages.

There are two basic ways to purchase seedlings from 

nurseries: speculation stock and seedling contracts.

Buying speculation stock. Some nurseries sow a certain 

percentage of their annual production specifically for the 

speculation market. Usually, these are species and seed sources 

that are adaptable to a wide geographical area or have proven to 

be marketable in the past. Surplus seedlings are also sold as 

speculation stock. Because of anticipated losses, most forest 

nurseries oversow their seedling orders and therefore have some 

seedlings available each year for sale on the open market. The 

quantity and seed source of this surplus stock varies from year to 

year, however, and so seedling users must contact different 

nurseries each season to learn what species and seed sources will 

be available. Speculation crops seldom match the proper seed and 

elevation zones and thus are often planted on less-than-optimum 

sites.

Contracting for seedlings. Because tree seedlings area 

perishable product and the market is notoriously change14
able, economics dictate that most forest nurseries grow a large 

proportion of their seedlings on contract. As discussed earlier, 

forest nursery seedlings are different from ornamental stock in that 

most seed lots are biologically suitable for only a relatively few 

planting sites. Therefore, most foresters and other seedling users 

procure their stock by contract and specify the appropriate species 

and seed source.

An intermediate option is to purchase some trees from outside 

sources and grow the rest in a small-scale nursery (see section 

1.1.5 for more discussion).

1.1.2.2 Starting your own nursery

Once the decision is made to start a nursery, the next question is 

whether it should be a bareroot or container facility.

Bareroot nurseries. Bareroot seedlings are grown in open fields 

in native soil, and consequently, the soil, water supply, and climate 

of the nursery site must be suitable for tree growing. The rate of 

seedling growth and length of the growing season are largely 

controlled by the climate at the nursery site. Quality sites are often 

difficult to find in convenient locations, and good agricultural land is 

often expensive. A considerable capital investment is usually 

required to develop a bareroot nursery of any size. Bareroot 

nurseries are also sensitive to the economies of scale. Once a 

nursery is established and operations have begun, it is important 

to function at near-capacity levels to have reasonable unit 

production costs. Compared to container nurseries, energy 

requirements and associated expenses are relatively low. A more 

comprehensive discussion of site selection factors that should be 

evaluated when locating a bareroot nursery is presented by Morby 

(1984).

Container nurseries. Container nurseries can be constructed on 

land with low agricultural value that would be unsuitable for 

bareroot seedling production. The amount of capital investment 

varies with the type of facility. Fully controlled greenhouses require 

expensive structures and environmental controls, but open 

growing compounds are much less costly. Because container 

seedlings are grown at high densities, less land is required 

compared to a bareroot nursery. Container nurseries are less 

sensitive to economies of scale and, in extreme situations, part or 

all of the nursery can be shut down to reduce operating costs. 

Container seedlings have high growth rates, especially in fully 

controlled environments, and so crops can be produced in one

growing season. From a business standpoint, this means that 

container nursery managers can respond quickly to changes in the 

market. Greenhouse crops are more reliable than those grown in 

open compounds, but this comes at the expense of large amounts 

of energy. (The biological and economic factors to consider when 

locating a container nursery are presented in chapter 2 of this 

volume.)

Selecting the best alternative. The decision of whether to start a 

bareroot or container nursery must be carefully thought out 

because there are many things to consider. It is helpful to list the 

various considerations side-by-side for ease of comparison (table 

1.1.3).

Biological considerations are of paramount importance in choosing 

between a bareroot or container nursery, and often, the lack of a 

suitable bareroot nursery site is the deciding factor. The general 

climate is also critical because container nurseries are typically 

favored at high latitudes or elevations where extremely short 

growing seasons make bareroot production impractical. 

Customers' needs, seedling handling and transportation systems, 

and the outplanting environment must also be evaluated. Because 

they are generally more tolerant to stresses such as desiccation, 

container seedlings are often the best option for harsh planting 

sites or when planters are inexperienced.

Economics must also be carefully analyzed, and a market 

analysis should always be done (see section 1.1.3). Projection of 

production levels, coupled with capital investment and operating 

costs, will indicate the most economically effective type of 

nursery at different production volumes. Energy source and cost 

are key factors that will significantly influence the choice between 

a container and bareroot facility.

Finally, consider availability of technical expertise, because the 

availability of a skilled nursery manager may influence the choice 

of nursery type. Few formal training programs in forest nursery 

management are available. However, several good university 

programs in greenhouse management or ornamental horticultural 

exist, and a trained horticulturist could be hired to manage a 

container tree nursery.

Under some circumstances, a nursery facility with both bareroot 

and container nursery capability might be most appropriate. 

Container nurseries are often used to grow seedlings from 

high-value or genetically superior seed while normal operational 

stock is grown in outdoor

15

seedbeds. In places where nursery soil is more suitable for 

growing broad-leaved seedlings, conifer stock could be grown in 

containers. In another scenario, the amount of arable land at a 

bareroot nursery might become insufficient to meet increasing 

demands for seedlings, and so a greenhouse could be added to 

supplement production. A combination container and bareroot 

nursery is also more flexible to market changes and can offer a full 

range of stock types including container transplants.

The rest of this manual assumes that the decision was made to 

develop a container nursery facility. Informa tion on development 

and operation of bareroot nurseries can be found in Duryea and 

Landis (1984).

17
1.1.3 Evaluating the Present Nursery Market

Potential nursery developers must be very realistic about the 

market they are planning to fill. A market analysis should be done 

to collect facts about demand, competition, and prices.

1.1.3.1 Demand

For nurseries that are being developed to meet in-house seedling 

needs, the demand is already known. But, for nurseries that plan 

to supply seedlings to other users, potential customers should be 

surveyed and detailed information collected to answer these 

questions:

• What species, number, and size of trees are needed?

• When and where will these trees be outplanted?

• How long will these needs persist, and will they

 change over time?

In particular, nursery developers planning on growing seedlings for 

government tree-planting projects should be aware that most 

contracts are awarded on a minimum bid basis and so profit 

margins are small. Seedling demand from government agencies 

can vary considerably from year to year. For example, large fire 

rehabilitation projects typically create a large seedling demand for 

1 or 2 years, but then the demand can drop precipitously in 

subsequent years with few fires. Reforestation projects after timber 

harvest have traditionally provided a relatively steady seedling 

demand in the Pacific Northwest, but recent changes in land-use 

policies have reduced the demand significantly. Therefore, 

potential nursery developers should carefully analyze their 

potential market and make certain that a sustained demand exists 

before investing in a nursery.

1.1.3.2 Competition

In addition to surveying the market, potential nursery developers 

must carefully analyze their competition. Forest and conservation 

nurseries in the United States can be categorized as government, 

forest industry, or private. A large percentage of the forest and 

range lands in the United States is managed by either Federal, 

State, or local government agencies. Some agencies, such as the 

USDA Forest Service and the USDI Bureau of Indian Affairs, have 

their own nurseries to produce seedlings for their needs; others, 

such as the USDI Bureau of Land Management, procure most of 

their seedlings from other government or private nurseries. Most 

States and some local government entities have their own 

nurseries. Although State nurseries provide seedlings to small 

private landowners, they do not engage in open competition with 

private nurseries. Forest industry nurseries produce seedlings for 

their own lands, but often also grow seedlings on contract for other 

customers. Numerous private nurseries also grow tree seedlings on 

contract or for speculation.

Container nursery developers will be in competition with both 

bareroot and container facilities, and so should find out all they can 

about the location, capabilities, and efficiencies of their potential 

competitors. National (Okholm and Abriel 1994a) and regional 

(Okholm and Abriel 1994b) nursery directories are available to 

help potential developers survey the competition. Private nurseries 

have worked hard to develop their businesses, and so don't expect 

them to share all their secrets! Because of their noncompetitive 

stance, government nurseries can be a good source of information 

about the local market.

After you have completed gathering information about the 

existing nursery capacity and markets, compare it with your own 

projections, and you should be able to decide whether 

developing a new nursery can be economically justified.

18
1.1.3.3 Price

Potential nursery developers should survey tree seedling prices in 

the local market and try to determine recent price trends. Many 

economic, political, and biological factors affect the price of 

seedlings from year to year. Be aware that price generally 

increases with size (volume) of container because larger seedlings 

require more growing space (table 1.1.4). Forest tree seedlings 

are traditionally sold on a per thousand basis, but many nurseries 

make 50 or 100 trees the minimum order. Because container 

stock is sometimes sold in the growth containers, some nurseries 

price their seedlings accordingly. For comparison purposes, 

however, seedling prices are usually converted back to a per 

thousand basis.

Most growers will be willing to furnish seedling price quotes over 

the telephone. Some state forestry organizations survey seedling 

prices regularly and so can furnish detailed listings. Prices can 

vary significantly from year to year, however, reflecting market 

trends. Because of the associated risks, contract seedling prices 

will generally be different than those for speculation seedlings. 

Sometimes, contract prices are artificially low because growers 

"underbid" the market to make sure that their nurseries are at full 

capacity. On the other hand, speculation seedlings will often be 

sold at bargain prices because they are surplus and cannot be 

held over for another growing season.

The next step is to estimate how much it would cost your potential 

nursery to produce a seedling crop and then compare these costs 

to market prices.

19
1.1.4 Estimating Product Costs

Nursery developers should calculate product cost estimates to see 

if their seedlings will be competitive in the local market. Good cost 

estimates can be very time consuming, however, because they 

require considerable information about structures, equipment, labor, 

fuel, land, maintenance, and transportation. After collecting and 

organizing this information, the developer then analyzes how these 

costs will affect price per unit output at different nursery locations, 

facility types, and production levels. A good example of this process 

was reported by Guldin (1983), who analyzed the costs of 

producing container seedlings in the southern United States using 

four different types of containers and four growing structures. This 

economic information was then analyzed against comparable data 

for a bareroot nursery.

1.1.4.1 Requirements of a container nursery system

The first step in cost analysis is to identify all the things that are 

required to operate a nursery. Novice developers often assume 

that there is a standard system for growing container seedlings but, 

in reality, no such thing exists. Each species of plant has its own 

optimum environmental requirements, and each potential nursery 

location has a unique climate. Individuals and organizations also 

have their own goals and constraints that will affect development 

decisions. Therefore, nursery developers must realize that a 

container nursery facility must be carefully designed to match 

specific objectives (Ekblad 1973).

To make sure that all fa ctors are considered, a relatively simple 

systems analysis approach should be used. A container nursery 

system consists of a series of processes (Furuta 1978). A specific 

process, such as sowing seed, involves a series of sequential 

operations, such as filling the container with growing medium and 

placing a calculated number of seeds in each container. Each 

process and operation in the system has specific requirements 

including structures, equipment, supplies, and labor (table 1.1.5).

The objective during the nursery development phase is to 

understand the system and its processes well enough to identify 

the requirements and estimate their associated costs. Some 

requirements will be standard for all types of nurseries, but others 

will vary. For example, a nursery that is designed to propagate 

seedlings vegetatively will have slightly different process and 

operations, and therefore different requirements, than one 

designed to produce plants from seeds. Other nursery 

requirements--such as maintenance, reliability, and safety --are

20

not so obvious to a prospective nursery developer, but they must 

also be considered (Ekblad 1973). Maintenance requirements are 

those associated with keeping the nursery system running 

efficiently, whereas reliability requirements are those that keep the 

nursery working without catastrophic failure through the use of 

environmental controls, backup power, and alarm systems. Safety 

requirements must also be considered because even the most 

mechanically efficient operation must not involve unacceptable 

risks to nursery workers.

To ensure that all of the various requirements are considered, it is 

often helpful to visualize the nursery system, processes, and 

operations with a flow chart (see figure 1.4.11). Such a visual 

representation is an excellent way to show how the various steps in 

successful container seedling production relate in both spatial and 

temporal contexts. Because it is unreasonable to expect a fledgling 

nursery developer to know all the elements of a successful 

container nursery operation, the authors recommend visiting an 

existing nursery. In addition, there are several good references that 

deal with nursery development. Matthews (1983) listed the factors 

that should be considered for developing a container tree nursery in 

British Columbia, and Hanan and others (1978) discussed the 

economic considerations associated with ornamental container 

nursery development.

Once the nursery system has been broken down into its 

requirements, the associated fixed and variable costs must be 

estimated. In addition to the initial development expenses, annual 

fixed costs for depreciation, rent, insurance, and taxes also must 

be considered. Obtaining realistic costs for starting a container 

nursery facility will be difficult, especially for the novice, but this 

exercise is absolutely necessary for the development of a 

successful nursery. Government nurseries can be helpful in this 

regard because their production costs are public information (see 

table 1.5.1 in chapter 5 of this volume for an example).

1.1.4.2 Influence of nursery size and space utilization

The production capability of the proposed nursery is obviously 

an important factor that will affect product cost estimates. 

Larger facilities are more efficient because of the economies of 

scale but are also inherently more expensive to develop. Van 

Eerden (1982) found that 30 to 40% of nursery production 

costs in British Columbia were due to interest charged on 

investment and working capital. Thus, it is prudent to keep 

growing facilities as small as possible at the
beginning, and expand gradually as seedling demand develops 

and funds are available.

In addition to the size of the nursery, seedling production capability 

is a function of several factors:

1. Space use efficiency---the net useable production space that 

can be achieved in each growing area. Forest tree seedlings 

are typically grown on pallets or raised benches, and so their 

arrangement and the efficiency of space utilization control the 

maximum number of seedlings that can be grown per unit 

area. Typically, overall greenhouse efficiencies range from 65 

to 70% but can be high as 85%.

 2. Container size and arrangement---the lateral dimensions 

and density of cells per growth container, and the number of 

containers that can be placed in the growing area.

 3. Production efficiency--the proportion of shippable seedlings 

that can be produced per crop, and the number of crops that 

can be raised per year.

(More information can be found in chapter 3 of this volume.)

Multiple cropping is another way to increase seedling production 

per unit of growing area. In some parts of the United States, 

especially the South, more than one crop is grown per year in a 

container nursery (Guldin 1983). For example, some growers use 

the greenhouse as a starting facility. Once the young seedlings are 

established they are moved to another growing site, such as 

outdoor growing areas or a shadehouse, to finish their growth. A 

second crop can then be sown and finish the growing season in 

the greenhouse. Obviously, this production system is dependent 

on the type of nursery facilities and climate. Crops produced during 

the winter are always more expensive than summer crops because 

of the increased cost of heating and the greater time needed to 

meet target seedling quality (see production

cost comparison in table 1.5.1 in chapter 5 of this volume). In 

very cold climates, fuel costs may be so high that only summer 

operation of the greenhouse is economical. (Crop scheduling is 

discussed further in volume six of this series.)

1.1.4.3 Energy and transportation considerations

Since the energy crisis of the early 1970's, concern about energy 

use have greatly changed the economics of container nursery 

operation. Most container nurseries, especially fully controlled 

greenhouses, use large amounts of energy, and so potential energy 

use and associated costs must be carefully analyzed. In fact, 

energy considerations are one of the most important factors to be 

considered when evaluating potential nursery sites. The types and 

amounts of energy that would be used in container nursery 

operation will vary with nursery design and operation. Cameron 

(1982) discusses a computer model available to predict energy 

needs in a greenhouse given various alterations in greenhouse 

structure or seedling culture at a given site.

Because forest tree seedlings are typically outplanted in distant 

locations, transportation to the outplanting site can be a significant 

economic consideration. Originally, because of the problems 

associated with seedling storage and transportation, bareroot 

nurseries were located as close as possible to the outplanting site. 

With the advent of refrigerated trucks and storage facilities, 

however, it has become biologically and economically feasible to 

ship container seedlings for long distances. This has led to a trend 

to locate nurseries in milder climates where nursery operating 

costs will be less. For instance, British Columbia has a mild climate 

in the lower Fraser River Valley, but short growing seasons and 

very cold winters in the interior of the province. Thus, most 

reforestation seedlings for the province are grown near Vancouver 

and shipped inland for planting (Van Eerden 1982). The

21
container nursery developer should put considerable weight on 

placing the operation in a mild climate, even if the seedlings are to 

be delivered a considerable distance away. This assumes, 

however, that the nursery facility will be designed so that the 

seedlings can be properly conditioned before shipping and 

storage. In areas without refrigerated storage, nurseries must be 

located closer to the outplanting site to reduce shipping time and 

handling costs.

1.1.4.4 Balancing labor and equipment

It is possible to do all container tree nursery operations by hand, 

and this is the best option where labor costs are very low, creating 

jobs is an objective, or technology is prohibitively expensive or 

unavailable. Most nurseries use specialized equipment to increase 

efficiency and reduce labor costs. However, nursery developers 

should not become preoccupied with the mechanical and 

engineering aspects of a task without also considering economic 

and biological factors. Labor costs can be high during key seasonal 

operations in a nursery such as container filling and sowing, and 

harvesting and shipping. In between these periods, however, the 

nursery can be run by only a few skilled workers.

When evaluating the need for a piece of nursery equipment, the 

developer should consider the following questions:

1. Is this piece of equipment necessary to meet the biological 

needs of the seedlings?

2. How much time will this piece of equipment save, relative to 

the savings in labor?

3. How amenable is the task to mechanization?

4. Is time to complete the task a major consideration?

5. Will the equipment only be used for a very short time each 

year?

6. Can the equipment be leased or borrowed from local 

nurseries or other businesses?

22

The primary consideration in deciding whether to mechanize should 

always be the effect on seedling quality , and so each nursery 

process should be evaluated according to this criterion first. The 

intense activity during peak work periods can easily make 

mechanization appear desirable, but the nursery developer must 

keep in mind that a task lasting a brief time may well be 

accomplished most efficiently by intensive application of hand labor. 

Some processes, such as grading seedlings, require a trained eye 

and experienced hands and so are more difficult to automate. Other 

tasks, such as filling and sowing containers, must be done in a very 

short time period and so are usually worth the financial investment 

in equipment to speed up the process (Van Eerden 1982).

Mechanization becomes more economically feasible with an 

increase in size and sophistication of the nursery, and as the costs 

of temporary labor rise. However, the purchase of a new piece of 

equipment requires capital and new equipment must be used often 

enough to justify its cost. Low cost and innovative "homemade" 

equipment can be very efficient and cost effective. Thus, each 

case must be judged separately.
1.1.5 Feasibility Assessment and Development

Tactics

The final step is to do a feasibility assessment, which is simply an 

analysis of the pragmatics of the situation. Compare your project 

seedling prices with estimated production costs and weigh them 

against the risks and potential profits associated with the 

enterprise. The resulting analysis should incorporate a variety of 

facility designs, sizes, and locations, so that the developer will be 

able to identify the best nursery facility to meet the projected 

seedling needs. At this point, it would be wise to reconsider 

whether the best option might be to purchase stock from an 

existing nursery.

If the analysis dictates that starting a nursery is still the best 

option, then timing and degree of development must be 

considered. Nursery development tactics depend on the degree of 

risk to be assumed and the urgency of the need for the seedlings. 

It may be prudent to start with a small pilot nursery rather than a 

full-scale facility. Container nurseries are ideal for this purpose 

because you can focus on growing critical species that have 

unique environmental requirements while procuring the more 

traditional stock from other nurseries. Growing only part of your 

seedling needs affords some security of supply and establishes 

the technical capability to produce the entire demand if needed.

In spite of all this discussion about evaluation and analysis, the 

final decision on whether to start a container tree nursery often 

rests with the management philosophy of the organization or the 

individual developer. Many nurseries have been constructed to 

meet specific needs or desires in the face of evidence to the 

contrary.

23
1.1.6 Summary

A person who is considering starting a container tree nursery must 

be familiar with the terminology and unique characteristics of 

forestry and conservation plants. Unlike most other crops, 

seedlings from forest nurseries are typically outplanted on 

relatively harsh sites without subsequent care. This difference is 

significant because it means that seedling quality is defined by the 

environmental conditions on the outplanting site. There is no such 

thing as an "all-purpose" tree seedling. When confronted with a 

demand for tree seedlings, most people or organizations think that 

they need to start their own nursery, but they should first consider 

purchasing stock from an established nursery. If they decide to 

start their own nursery, the next decision is whether it should be a 

bareroot or container facility. There are many factors to consider in 

choosing the best type of facility. Potential nursery developers 

must be very realistic about the market they are planning to fill, and 

an analysis should be done to collect facts about demand, 

competi tion, and prices. They must also estimate product cost to 

determine if their seedlings will be competitive in the marketplace. 

The final step is to do a feasibility assessment in which estimated 

seedling prices and production costs are compared to the risks and 

potential profits. If the decision is made to build a new nursery, 

then a suitable site must be selected and developed. How to go 

about doing so is discussed in chapter 2 of this volume.

24
1.1.7 Literature Cited

Brissette, J.C.; Barnett, J.P.; Landis, T.D. 1991. Container seedlings. In: 

Duryea, M.L.; Dougherty, P.M., eds. Forest regeneration manual. 

Boston: Kluwer Academic Publishers: 117-141.

Cameron, S.I. 1982. Conserving energy in container greenhouses. In: 

Scarratt, J.B.; Glerum, C.; Plexman, C.A., eds. Proceedings, Canadian 

Containerized Tree Seedling Symposium; 1981 September 14-16; 

Toronto, ON. COJFRC Symp. Proc. O-P-10. Sault Ste. Marie, ON: 

Canadian Forestry Service, Great Lakes Forest Research Centre: 

91-109.

Duryea, M.L.; Landis, T.D., eds. 1984. Forest nursery manual: 

production of bareroot seedlings. Boston: Kluwer Academic 

Publishers. 385 p.

Ekblad, R.B. 1973. Greenhouses: a survey of design and equipment. 

Missoula, MT: USDA Forest Service, Missoula Technology and 

Development Center. 70 p.

Furuta, T. 1978. Environmental plant production and marketing. 

Arcadia, CA: Cox Publishing Co. 232 p.

Guldin, R.W. 1983. Regeneration costs using container-grown southern 

pine seedlings. Res. Pap. SO-187. New Orleans: USDA Forest 

Service, Southern Forest Experiment Station. 29 p.

Hahn, P.F. 1990. The use of Styroblock 1 & 2 containers for P+1 

transplant stock production. In: Rose, R.; Campbell, S.J.; Landis, 

T.D., eds. Target seedling symposium: Proceedings, combined 

meeting of the Western Forest Nursery Associations; 1990 August 

13-17; Roseburg, OR. Gen. Tech. Rep. RM-200. Ft. Collins, CO: 

USDA Forest Service, Rocky Mountain Forest and Range Experiment 

Station: 223-230.

Hahn, P.F. 1984. Plug+1 seedling production. In: Duryea, M.L.; Landis, 

T.D., eds. 1984. Forest nursery manual: production of bareroot 

seedlings. Boston: Kluwer Academic Publishers: 165-181.

Hanan, J.J.; Holley, W.D.; Goldsberry, K.L. 1978. Greenhouse 

management. New York: Springer-Verlag. 530 p.

Iverson, R.D. 1984. Planting-stock selection: meeting biological needs 

and operational realities. In: Duryea, M.L.; Landis, T.D., eds. Forest 

nursery manual: production of bareroot seedlings. Boston: Kluwer 

Academic Publishers: 261-266.

Landis, T.D.; Lippitt, L.A.; Evans, J.M. 1993. Biodiversity and ecosystem 

management: the role of forest and conservation nurseries. In: 

Landis, T.D., tech. coord. Proceedings, Western Forest Nursery 

Association; 1992 September 14-18; Fallen Leaf Lake, CA. Gen. 

Tech. Rep. RM-221. Fort Collins, CO: USDA Forest Service, Rocky 

Mountain Forest and Range Experiment Station: 1-17.

Matthews, R.G. 1983. Seedling production for crown lands in British 

Columbia: guidelines for commercial container nurseries. Victoria: 

BC: British Columbia Ministry of Forests, Silviculture Branch. 45 p.

McDonald, S.E. 1982. Fully controlled or semi-controlled environment 

greenhouses-which is best? In: Guldin, R.W.; Barnett, J.P., eds. 

Proceedings, Southern Containerized Forest Tree Seedling 

Conference; 1981 August 25-27; Savannah, GA. Gen. Tech. Rep. 

SO-37. New Orleans: USDA Forest Service, Southern Forest 

Experiment Station: 81-85.

Morby, F.E. 1984. Nursery site selection, layout, and development. In: 

Duryea, M.L.; Landis, T.D., eds. Forest nursery manual: production 

of bareroot seedlings. Boston: Kluwer Academic Publishers: 9-15.

Myers, J. 1992. Personal communication. Coeur d' Alene, ID: 

USDA Forest Service, Coeur d'Alene Nursery.

Okholm, D.; Abriel, R. 1994a. National Nursery Directory. Portland, OR: 

USDA Forest Service, Pacific Northwest Region, State and Private 

Forestry.

Okholm, D.; Abriel, R. 1994b. Pacific Northwest nursery directory and 

report. Portland, OR: USDA Forest Service, Pacific Northwest Region, 

State and Private Forestry.

Ritchie, G.A. 1984. Assessing seedling quality. In: Duryea, M.L.; 

Landis, T.D., eds. Forest nursery manual: production of bareroot 

seedlings. Boston: Kluwer Academic Publishers: 243-259.

Scagel, R.; Bowden, R.; Madill,; M. Kooistra, C. 1993. Provincial seedling 

stock type selection and ordering guidelines. Victoria, BC: British 

Columbia Ministry of Forests, Silviculture Branch. 75 p.

Van Eerden, E. 1982. The fundamentals of container seedling production. 

In: Scarratt, J.B.; Glerum, C.; Plexman, C.A., eds. Proceedings, 

Canadian Containerized Tree Seedling Symposium; 1981 September 

1416; Toronto, ON. COJFRC Symp. Proc. O-P-10. Sault Ste. Marie, 

ON: Canadian Forestry Service, Great Lakes Forest Research Centre: 

83-90.

Ying, C.C.; Thompson, C.; Herring, L. 1989. Geographic variation, 

nursery effect, and early selection in lodgepole pine. Canadian 

Journal of Forest Research 19(7): 832-841.

Zasada, J.C.; Owston, P.W.; Murphy, D. 1990. Field performance in 

Southeast Alaska of Sitka spruce seedlings produced at two 

nurseries. Research Note PNW-RN-494. Corvallis, OR: USDA 

Forest Service, Pacific Northwest Research Station. 11 p.

25