The Alpaca Industry - The Future
Copyright (C) Nick Veltjens - 1996

This paper represents my personal opinions based on the latest available information, and is not intended as advice. None of my statements necessarily represent the opinion of the Australian Alpaca Association Inc. Curves in graphs have been interpolated for clarity.

A Look 25 Years into the Future
Alpacas come from a finite source. A short time ago all alpacas (apart from a few zoo inmates around the world) lived in South America. Their distribution was restricted mainly to Peru, Bolivia, and Chile, with insignificant numbers across the borders of these countries with their immediate neighbours.

Growth of these alpaca populations in South America has been and still is believed to be at a standstill. Some exports have however allowed the establishment of small herds in some other countries, especially in Australia, where over 10,000 animals are registered (early 1996), and North America (USA and Canada) which has about half of the Australian herd size.

In Europe only around 1,000 alpacas exist, mainly in France, UK, Germany, Switzerland, and Austria, where breeders have concentrated mainly on lamas for trekking in the tourism industry.

Alpaca herds grow at different rates in the various regions of the world as a result of the differences of:

Not much detailed statistical information is available about South American herds. The latest estimates of herd sizes seem to be those compiled by J C Wheeler (1991)* from other sources.
*Origen, Evoluciûn y Status Actual in Avances y Perspectivas del Conocimiento de los camèlidos Sudamericanos, ed. Fernandez-Baca (1975), FAO, Santiago 11-48
(The graphs in this paper are therefore based on those figures and on the assumption that the herds in South American countries have neither grown nor diminished in the recent past.)

Fertility rate, in this paper means the average chance of an hembra having one live and surviving cria per year, and allows for abortions, absorbtion, still births, and failed or delayed start of pregnancy, but not for deaths after the cria stage.

Mortality is measured in years of life. In South America this is likely to be the actual average lifespan of the animals, as the meat production is an integrated part of the alpaca industry.

In Australia and other regions outside South America, the lifespan my be a measure of "productive life"; an hembra may produce offspring all her life, which could be 20 years, although we may find that on average it may be less than that. In the absence of empirical data, this study has made an assumption that an hembra will "live" 16 years in Australia, after which it may either be retired to a "geriatric alpaca farm" or culled. In other countries this lifespan has been reduced a little, simply because of the presence of more dangerous deseases.

The lifespan of stud machos has been shown artificially short because of their becoming "superseded" in terms of up-to-date stud quality, while in mathemetical terms they will continue to live as a wether.

World Alpaca Populations
South America
In order to calculate alpaca populations where the known growth rate is zero, the average life span and fertility rate have been used as indicators. The growth patterns are mathematically quite sensitive to these two variables, as only a small change in either will cause considerable variation in the growth rate.

The results are astonishing, as the resultant fertility rate for South America of between 33% and 35% is very low; it means that an hembra will on average produce a live and surviving offspring only every 3 years in her adult life. The lifespan of an hembra of 6 to 8 years is also surpisingly short, but we must not forget that in South America alpacas are not only bred for their fleece; meat production and leather are important in these countries.

The harsh climate in the Andes, the presence of some preditors, as well as poaching will reduce the chances of survival for cria and adult alpacas alike.

The herds established in other parts of the world on the other hand will grow, but even there this will take place at varying rates.

Again climate will be an important part, and so will be available pasture. While alpacas are quite hardy with regard to surviving in such conditions, the birth of a cria in the depth of winter could only be assured with human supervision, especially as alpacas do not seem to like to be shedded for an extended period. The fertility rate has therefore been taken as slightly lower in countries with very cold winters as compared with Australia.

It appears that in Australia the expansion of the alpaca herd will in the longer term have the least restrictions. While the graphs are based on a fertility rate of 75%, which is probably a bit pessimistic for the currently small and well supervised herds, it may become more appropriate when individual herds increase to 1,000 or more.

Accordingly, the distribution of alpaca herds in the world will change dramatically in the next 25 years. At the end of that period, Australia, having a head start and a slightly higher growth rate, is likely to have the largest herd in the world (6 million). North America with 2.6 and Europe with 1.5 million will follow.

In the European region this growth is likely also to expand physically towards the East, where more arable land is available, and into Spain and Italy, because of the suitibility of the climate.

An establishment of an alpaca herd in Asia is difficult to assess. If it is to occur, it will not be immediate, but it could happen, particularly in southern China, where rapidly rising living standards, the existing silkworm industry, and the proximity of the largest alpaca fibre market in the world (Japan and Korea) may create opportunities for farmers to become interested in supplying these markets in their vicinity.

This paper simply draws attention to this possibility, even if it will have no major effect on numbers elsewhere, as the total Asian alpaca herd may then reach only about 500,000 by the year 2020.

This brings the world total by 2,020 to around 14.5 million alpacas. To keep this in perspective, this compares with an estimated 430 million sheep in the world.

Alpacas in Australia have been imported almost exclusively from Chile, and have since been improved considerably, particularly with regard to colour separation and fleece quality.

Lately some breeders have started to import from Peru in order to provide greater genetic choice for breeding. While the numbers of imports from Peru likely to come into this country are quite small relative to the existing herd in Australia, they will represent an important genetic contribution. In fact the combination of coloured alpacas, bred to an advanced quality in Australia compared with other countries, combined with the best out of the Peruvian imports, will, if done with care and forsight, create the best coloured alpacas in the world.

This will, if it is not already, become an exportable commodity, once the overseas markets have become aware of developments in this country. At the same time, high quarantine standards will make Australian breeders preferred exporters.

Effect of Imports
The importation of alpacas from South America is restricted by the governments there, and by insufficient South American and Australian quarantine facilities. As a result imports to Australia are likely to start at a rate of about 3.8% of the Australian herd p.a. and will rapidly decrease to well below 1% p.a. even if imports were, inspite of the Peruvian government's intentions, to rise to 2,000 or more animals a year; in other words they would have only minimal effect. The end result, depending to some extent also on the number of alpacas exported from Australia, would still be an alpaca population of between 5 and 8 million in this country by 2,020. Again, to keep it in perspective, this needs to be compared with 137 million sheep in Australia and 26 million cattle at present.

A Breeding Industry
It is clear therefore, that alpacas will remain a "rare" commodity for a very long time. In turn, this means that animals with relatively lower quality may hold a higher value a little longer.

As demand for best genetics makes stud animals more valuable, the rapidly improving quality of Australian stud alpacas can lead the world.

The Fibre Industry
Alpacas are bred for their elite fibre. There is rapid growth in international demand, to the extent that Japan and Korea are buying already more than the traditional European markets (Italy and Britain).

Australia is and will for a few years remain a small producer. As such Australian producers can only develop on the domestic stage, although they must enter the world market to display the quality that is being produced here.

In the meantime, it is necessary to breed up the herd to a stage, when the industry can become independent from fibre imports. It seems that, with present machinery, around 100,000 Alpacas per colour would be necessary:

black, white, brown, fawn, grey That means about 500,000 alpacas for a competitive self sustaining fibre industry with value added end products. That number is not likely to be achieved before 2008.

It is estimated that 30 tonnes of alpaca fibre is produced this year (1996) in Australia, compared with almost 8,000 tonnes world wide, mostly in Peru. Out of the world production of about 39,000 tonnes in the year 2020, Australia will produce 16,000 tonnes, which will be the highest of any one region.

In terms of marketing, processing fibre, and value adding, it will be important for Australia that strategic alliances be formed with other fibre producing nations to utilise their respective strengths as part of the overall market, and to secure quality control and supply of raw materials.

Australia will by then be in a position where it could play an important part in this alliance, especially if a start is made even now at this early stage.

Prices of Alpacas
Value for money always depends on quality. Therefore continued improvement of fibre quality will drive the breeding industry.

There will be an increasing difference in the price between breeding and commercial quality alpacas. Top quality will always command a higher price.

Supply and demand in the world can to some extent be influenced by marketing; marketing is perception management. In the long run, the early development of a commercial fibre industry with value adding allows the Australian breeding industry to become more and more influencial in the world market as the alpaca herd increases.

All this is however only possible, if the industry remains focussed on the long term aims and objectives. Part of these need to be: