Alpacas offer advantage of low maintenance
By John Burns
ARE alpacas another example of new enterprises which make money for the few who get in at the start, but later prove to be disastrously unprofitable?
One West Country producer insists they are not.
John Gaye of Blackmore Vale Alpacas says the animals have a future because producers have grouped together to organise one co-op to market the fibre and one to process it, so the industry is now well on the way to being vertically integrated.
It is also impossible to increase numbers of animals rapidly because imports are restricted and expensive, and the world population is not that high, adds Mr Gaye.
"Before I invested in alpacas I researched the two most commonly quoted examples – angora goats and ostriches – and why people lost money on them.
"The fundamental reason was they had not matched production with marketing and processing. On top of that both those species could be, and were, multiplied quickly," he says.
Alpacas reproduce slowly, and no technology has been found to speed it up. But they do breed at any time of the year, with male presence inducing ovulation in the female. Despite that, most breeders aim for spring calving and it is usually a single baby.
Although they reproduce slowly, once females begin breeding at 14-16 months they will continue to breed for 15 years, with a gestation period of 11 months.
Setting up a herd is costly. Good quality females, pregnant to a quality male cost £7000-£9000 each. They require shelter, shade and normal stock fencing. Field shelters are frequently provided free when buying stock because the animals cost so much, but Mr Gaye is not convinced these are necessary when there are natural alternatives.
Alpacas do not need high quality ryegrass, in fact they perform better on low quality pasture, stocked at 12-15 adults a hectare (5-6/acre).
They are also low maintenance animals requiring little veterinary attention, says Mr Gaye. They need a combined clostridial and pasteurella vaccine annually at shearing in May/June. At the same time they have their toenails and six incisor teeth trimmed, and will be wormed if needed.
Because alpacas are not killed for meat, the only income is from fibre and breeding stock. Small quantities of alpaca fibre can be sold at the farmgate for up to £50/kg, compared with the new fibre co-op price of £25/kg. But typical fibre yields are only 2kg-4kg a year and quality varies with individuals and age.
A study commissioned by the fibre co-op and carried out by the Royal Agricultural College, Cirencester, suggests that a vertically integrated industry could return more than £50/kg by sharing the margins obtainable at all stages in the process.
So with high set-up costs and low fibre returns is it possible to see a return on your investment?
Mr Gaye says most people starting an alpaca enterprise would initially want to keep female offspring, and possibly some males.
The males, if kept, would return only about £75 a year for fibre, to give a gross margin of £10 a head. But female stud fees may be £500-£750 each.
If the amenity value of castrated males fell significantly, most of the stud fee for females producing a male cria would have to be carried by the female offspring, meaning £1000 a year or more could be involved in the stud fees to produce one female cria.
Because Mr Gaye is building up his herd, most female offspring are kept, so he will receive little income from breeding stock until there is a surplus of females to sell.
The quality of the females must improve as well or their average value could be less than was paid for the foundation stock. Eventually, Mr Gayes herd will reach the desired number and the total investment can then be averaged out across that number.
In the meantime vigorous promotion, the establishment of a foolproof identification system, and careful vetting of quality by the Alpaca Society should ensure animal quality and traceability improves.
Also, a vertically integrated marketing system could develop the market so that it keeps pace with increasing output.
Then, with less capital invested a head and better returns, the fibre business will become viable in its own right, says Mr Gaye. *
Breeding females Castrated males
Fibre yield (kg/year) 3 3
Fibre price (£/kg)* 25 25
Value of fibre (£/head) 75 75
Average value of offspring**(£/year) 2375 –
Less replacement cost -500 -50
Gross output (£/head a year) 1950 25
Concs 18 –
Vet and med 30 5
Misc incl shearing 30 10
Total variables excl forage 78 15
Gross margin (£/head)*** 1872 10
Stocking rate/ha 12.5 12.5
Gross margin (£/ha)*** 23,400 125
*Fibre value could double with improved quality and vertical integration.
** Assuming a yearling female value of £4000 and castrated male of £750, giving average over two years of £2375 a year assuming equal numbers of each sex.
***GM a head should be after stud fees, most of which has to be borne by the females. At £1000 a female this would reduce gross margin to £872 a head or £9505/ha.
• Cria Young or baby.
• Weanling Weaned young.
• Macho Adult male.
• Hembra Adult female.
• In the UK, adults are more commonly referred to as males and females.
• High cost investment.
• Expensive breeding stock.
• Low maintenance animals.