Alpacas are often represented as "The World's Finest Livestock
Investment." For most owners though, alpaca ownership should be thought
of more as a business. You seldom have to trim the toenails on your
stock portfolio or market your 401K. Alpaca ownership is more active
than passive investing, but the results are in your hands and the
rewards can be larger as well. (Though alpaca investment strategies,
like agisting and co-ownership, are also available.)
can be raised profitably on small acrerage. Their high value and low
maintenance needs make them ideal for both hobby farmers and full-time
breeders. In addition, livestock offer unique benefits in the form of
tax advantages, income deferral, and investment compounding. Alpacas
are also fully insurable and can be depreciated. Many breeders also
capitalize on the business opportunities presented by selling alpaca
end products, support products, or services. See the resource list for this section for more information on these important topics.
prices have been stable for many years, so the key to profitability
currently is in breeding animals and in selling or rebreeding the
offspring (rather than simply reselling the original animal).
Rebreeding any offspring further compounds your original investment. As
the table on the right shows, starting with just 3 bred females could
result in a herd size of 20 alpacas in 5 years, assuming half of the
offspring are female and half are male. At an average value of, for
example, $5,000 for males and $15,000 for females, your original
investment of $45,000 would be worth $180,000 in 5 years.
key to realizing this value is in marketing and selling those animals
when you're ready, and it's this aspect that requires alpaca owners to
think most like business people. Fortunately, national and regional
organizations, like AOBA and GLAA, have been formed to promote
awareness of alpacas and to provide resources and venues to help their
members market their animals. In addition many established breeders do
co-marketing events as a service to their customers.
fiber market is still being developed in the United States. Currently,
there isn't enough alpaca fiber produced domestically to interest most
commercial processors. Fiber operations can be profitable if the
purchase price of the animals is low and the farm develops a strong
market to cottage industry (hand spinners, fiber artists, etc.) or does
value-added processing (carding, spinning, weaving, knitting, etc.).
ownership can be rewarding on many levels. For owners who approach it
as a business it can offer a significant return on investment in
addition to the joy of owning these beautiful animals.