Closer views needed to identify.

Here are some closer views.

The yellow looks like lichen - are you sure the whitish stuff isn't as well? Have you peeled some of it off and taken a close look with a hand lens? Does it wiggle or have legs on the underside?

No, I haven't gone that far yet. It had a wispy sort of cotton look last year which did not look like lichen. I expect it is dormant right now as I took these pics this evening and my daffodils aren't even blooming yet.

That's Pine Adelgid, you need Bonide 609 Tree/Shrub Drench Insecticide. I get that on my pines when I graft, because they have to stay in high humidity for extended period. The Bonidide corrects it

other than seeing them on the trunk .. what if any damage can you associate with them ???

ken

I get these things on my P. wallichianas and just leave them be. Have never seen any damage at all.

Ken and Sara, I seem to be losing needles and overall the tree just doesn't look that healthy. The needles seem kind of sparse. It was a new ornamental in October of 2015.

Sc77, I doubt that is available in Canada but I will be in the US in a couple of weeks and see if I can find it. Where do you get your Bonide 609?

I got it on Amazon. As others mentioned, this particular pest won't kill the tree, at least not an established tree, but when you have fresh grafts and this pest is congregating around the graft union, sucking sap...It has to be addressed. I really hate using chemicals as much as anyone, but sometimes you have to. Some sites suggest hort oil or other milder solutions will work, but another super user on this forum (Dax), found the Bonidide to be the only solution that worked.

https://www.amazon.com/gp/aw/d/B00192ANXM/ref=mp_s_a_1_1?ie=UTF8&qid=1490894811&sr=8-1&pi=AC_SX236_SY340_FMwebp_QL65&keywords=bonide+609

You could probably leave it alone as other suggest, but it looks nasty, and in my experience spreads if not addressed. I didn't want that stuff all over my other native white pines