Bagworms will form a cocoon that is made from the host plant and when the host plant is an evergreen the cocoons can be mistaken for cones. Bagworms are potentially damaging insects to many trees but especially to evergreens, most frequently spruces and Arborvitae. They can be controlled with the properly timed application of a pesticide.
If not they can seriously damage an evergreen in one season. More.
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