Sacred Tree

To be honest, your army is a bit small for month 6. Do you have at least both main heroes fully leveled up? It would be good to level up your secondary heroes as well... Theoretically, you should be getting +12 dragons per week from your native castles and dwellings. Is the growth of your spiders maximized? (It should be +16)
1) Were there significant losses on the Knight or Orange Elf map that you couldn't recover from?
2) Have you completed the other quests for components?

Maybe your army is a bit small, but frankly, what difference does it make when 600 hounds one-shot 500 vampires, and 170 horses, with luck, kill 57 dragons. And the demon's initiative is higher even with my two initiative rings, and my 350 liches with a unicorn bow only kill 12 archdemons. It seems like you need an army 12 times larger to win against them. 6000 vampires or 800 dragons. And that's just one year gone. Something strange is happening. Either I'm just unlucky and there's only one demon on the entire map, and all its attacks are lucky, and I can't do anything about it.