Setting is everything for the speaker of "Fern Hill." The pastoral beauty of the countryside around the farm where he spent his childhood preoccupies the entire poem.
That means that our oh so nostalgic speaker fills in plenty of details about what Fern Hill looked like. He says he was, "famous among the barns / About the happy yard and singing as the farm was home." Later, he says, "I was huntsman and herdsman, the calves / Sang to my horn, the foxes on the hill barked clear and cold." In stanza 3, the speaker says, "it was lovely, the hay / Fields high as the house, the tunes from the chimneys, it was air / And playing." So basically, this is the best, greenest, most awesome place ever.
Normally, setting in a poem is just the backdrop—a place for events to take place. But in this case, the setting takes front and center of the poem, as if it were the poem's main character or central idea. Imagine asking one of your friends what they did last summer, and your friend busts out a 54-line description of where they were. That would be sort of weird (okay, really weird), but it would also be totally clear how much the landscape affected your friend. The descriptions in "Fern Hill" become a mirror for the speaker's internal experience of being young. When he says he was "famous among the barns / About the happy yard and singing" we get a clear idea of how happy he was, and that that happiness was very connected to his sense of place. For this guy, being happy on the farm embodies all that he loved as kid, and all that he misses as an adult.
Also, every description is heightened in the poem, and no, not because he's a nature-loving hippy. He's not hugging the trees and he's not holding solo drum circles. But what he is doing is praising youth, which is something everyone can get down with. The "fire green as grass" and the "spellbound horses" take on metaphorical, dreamlike qualities. The horses "flashing" and the farm like a "wander white" make the setting seem enchanted.
In the poem, "Fern Hill" feels like a living, breathing thing. Through the imagery of the poem, the setting is transformed into a magical place where the speaker was "green and carefree." Instead of just saying, "wow, I loved hanging out at Fern Hill when I was younger. I really wish I could go back there," the speaker uses descriptions of the setting to reflect that love for the past.