Is the alpaca industry viable or an unsustainable fad?
They come from a land down under, mild-mannered, mop-haired oddities of alpine evolution and cherished Andean fleece, and in Butte County, the South American alpaca is a stranger far from home.
Yet around the nation this smaller relative of the llama has become a recognized creature both in name and in face after speculative entrepreneurs began importing the animals from Peru three decades ago with the hope of launching a lucrative fleece, or fiber, industry.
Few, however, have gotten rich in the alpaca trade, and today several hundred of the fluffy camelids reside quietly on local farms, sheared each spring of their shaggy coats while a cottage industry peters forward on sales of alpaca fleece and woven garments. Some economic analysts even believe the entire industry is doomed to fail, and while owners and breeders concede the 2008 economic meltdown stalled business, many eyes within the industry remain locked hopefully on the future, where fortunes may still lie.
Mike and Cindy Merrifield bought nine alpacas in 2008. It seemed a perfect time to invest. Prices of alpacas had just plummeted with the economy, so they scored some hot deals from other owners then selling out. The couple’s herd has since grown to 26 head, and on their five acres of land in Yankee Hill they aim to mount a herd of up to 35 alpacas, whose relatives include the dainty wild vicuna of the Andes and the giant camels of Asia. The Merrifields own both Suri and Huacaya alpacas, the two pure breeds of the species. The less common Suris come draped in long dreadlocks, each hair sometimes eight, 10 or 12 inches in length, while the Huacayas have shorter, frizzled hair.
Cross-breeding is discouraged.
Just north of Chico, Kathleen Friend purchased several alpacas in 2002 and today she keeps 45 Suris and Huacayas on her ranch, named Friendly Farms. Breeding is a careful, selective process in which animals are paired with the hope that their offspring, or cria, will bear fleece even silkier, finer and denser. As Friend says, “You always breed up.”
And few breeders would ever intentionally cross alpacas with their llama cousins—though accidents happen. At Feather River Alpaca Farm, currently home to a herd of 50, a llama-alpaca hybrid shares the pasture.
“He’s not very pretty,” said Margie Cline, who owns and operates the farm with her husband, John.
Alpacas, Vicugna pacos in taxonomic talk, were initially domesticated and bred many centuries ago for their fleece and flesh in Bolivia, Peru and Chile, where an estimated 1.5 million to 3 million of the animals dwell. American breeders grow reticent when asked about the notion of eating alpacas, and the animals’ single marketable product remains their fleece.
But how marketable is it, really? The going rate for the cleaned yet unprocessed fiber is roughly $3.50 per ounce. The average alpaca, which may live for 15 or 20 years, produces about seven pounds of fleece annually—a bundle of fluff worth roughly $400. To Rich Sexton, a UC Davis professor of agricultural and resource economics, such numbers add up to failure.
“These animals are fundamentally worthless,” said Sexton, who co-authored a paper in 2007 with Tina Saitone, then a UC Davis grad student, about the poor prospects for the alpaca industry. “It’s a sad situation because many people dumped big money into a terrible investment.”
Sexton compares the alpaca industry, a relatively small, tight-knit circle of owners, to a pyramid scheme.
“The only way for these people to recover the money they’ve invested is to convince others to enter the industry and believe in the value of the animals,” he said.
And those who believe will pay big in the hope that the investment will grow. Just to have a female, or dam, impregnated by a well-bred male, or sire, can cost more than $2,000, and even after the 2008 crash alpacas can cost more than $6,000 per head. In 2003, the Clines paid as much as $18,000 for their first animals, and some alpacas have sold for more than $30,000.
“I’ve heard alpaca owners say that the real value is the animal itself,” noted Sexton. “It seems these people don’t recognize what they’re saying—that the alpaca’s only marketable product is worthless.”
Susan Crane of Andante Alpacas in Chico bought into the industry five years ago with a purchase of five Huacayas. Crane knows she missed out by not selling a few animals while the price was high.
“I was still building my herd and was just about ready to sell a few when the economy just tanked,” she said.
Yet Crane continues to grow her herd, selectively breeding toward improved fleece. She weaves and knits shawls, scarves and other garments made of the animals’ fibers, and sells the products on site. A member of the trade organization North Valley Alpaca Links, Crane meets with other local breeders regularly for “fiber days” at which the group dyes, knits and weaves their fleece while trading advice and alpaca stories.
These same breeders also take road trips together. Sharing a vehicle and transporting their best young alpacas in a tow trailer customized for alpaca comfort, they travel as far as Oregon, Reno and the Bay Area to attend alpaca shows, an increasingly common sort of event at which ungroomed alpacas, fresh off the pasture and draped in their coveted locks, are judged and rated for beauty and fiber quality. Alpacas that go away with medals can become valuable assets to their owners, either as sires for hire or females for sale.
This season Mike Merrifield plans to enter his animals into shows, while his wife is busy taking weaving and spinning lessons. The couple plan to market homemade products on site, though it’s the champion-grade show animals, says Merrifield, that bode to produce fortunes.
Like the Merrifields and others in the alpaca trade, Friend at Friendly Farms keeps a bright outlook.
“This industry is strong, and it’s going places,” she said.
But Dr. Sexton sees a very different future, in which Peruvian fleece on the American market will always be cheaper and in which owning alpacas may never quite pay off.