What causes the trees to not be formed properly?

User Support Hub Scenery & Airports
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I created a bug report in this thread:

Trees not forming properly in forested areas - WU11: Canada degrades scenery quality (perhaps other WU countries affected too) - Bug Reporting Hub / Scenery and Airports - Microsoft Flight Simulator Forums

It appears it’s not in all regions but definitely an issue for different people at different locations.

I don’t know what causes the issue but I do believe it’s baked into the scenery rather then settings specific. When I disabled World Update XI: Canada the trees in the scenery in the area I test (around CYYJ) looked properly formed just like they do in 2020.

Have a look at the screenshots in the other thread (and please vote if you’re also experiencing the issue).