Northwest Alpacas: Alpacas in the Future: 1-2-3

Alpacas have had a great run. Beginning in the United States in 1984 the herds grew, alpacas spread to countries around the world and a lot of people made good money raising alpacas. The boom has been fueled by shows, promoters, a population moving to the country, demographics and the svelte alpaca’s natural charisma. Then along came a debt crisis, sub prime mortgages, and unemployment. The question is; what’s next.

I am at heart an optimist and I believe the transition that I am suggesting is both possible and profitable. Below you will find a three point plan that is the basis of my optimistic view of the future for alpacas.

Today people make economic decisions based on more basic prospects of risk and reward. The pet industry model, the collector’s model and the show model are in decline. How can a committed alpaca farmer see their way to a profitable future? I believe we need to adopt concepts found in the tried and true traditional live stock models; 1) we need to replace selection by show judges based on phenotype with selection using EPD’s that are based on genotype 2) we need to cull alpaca that are not improving the breed using the surgeons scalpel, advanced breeding techniques such as embryo transfer and heaven forbid the me... mar..., ( I’m sorry I just can’t bring myself to say it) and 3) we need a fiber collection and sale system based on the bailing machine and the international cash market for fiber.

Expected progeny differences (EPD’s) represent the future of breed improvement. This selection system overcomes the problem of the genetic variability inherent in small herds; the lack of selection accuracy based solely on phenotype; and the barn blindness that afflicts so many breeders.

An EPD is an estimate of the genetic merit of an animal for a single trait. The EPD is the expected difference between the performance of a specific animal’s progeny for a specific trait and the average performance of all progeny for that trait. Their use maximizes the following genetic principals.

There are four basic genetic prerequisites for rapid breed improvement: EPD’s allow a breeder to maximize the value of these scientific principals.

Genetic variation is extremely important to the rate of gain. The more variation for a particular trait in a population, the more potential there is for change. If breeders have a wide variety of animals to choose from–such as those with high or low fleece weights–they can select alpacas with high fleece weight and breed for the trait. Improvement in fleece weight will be rapid.

Selection accuracy is important if any improvement or gain is to be made. This means the traits you select for must be heritable. Accuracy assumes that we have the ability to separate superior and inferior animals. If you select for a heritable characteristic, such as fleece weight, you must identify superior stud males who historically have produced offspring with higher than average fleece weights to insure the trait is passed to the offspring. The same goes for fineness, crimp, staple length, etc. The single most effective way to do this is by establishing EPD’s.

Selection intensity means being highly selective of progeny produced by the parents you have chosen for foundation stock, and retaining in your herd only the offspring that exhibit a superior expression of the trait under selection. This ensures that breeding values will remain high and that each generation of offspring should improve: The higher the selection intensity, the higher the rate of genetic gain.

Generational interval affects the rate of genetic change simply because the more rapidly one generation replaces the previous one, the faster the potential gain. Mice reproduce more quickly than humans, producing150 generations in the time it takes humans to produce one. (This makes it much easier to effect change in mice than in humans. And improving people is a problem because there is very little culling undertaken.)

Generational interval is determined by the average age of the producing males and females in a given herd. Alpacas have a generation interval of four to six years for females and approximately five years for males, although this interval will vary from herd to herd. You can calculate the interval in your herd by dividing the number of alpacas into the total of their ages. A shorter generational interval means faster gain.

The Alpaca Registry (ARI) provides a free service available to all of their members to calculate their EPD’s. You can visit ARIlist.com for complete details. EPDs are the proven method for wholesale genetic breed improvement in most if not all commercial
livestock breeds.

Embryo Transfer will capitalize on the selection power of EPD’s by identifying the most productive females and mating them using multiple embryos to the most productive males. There will be several market enhancements resulting from this approach 1) a good market for low priced females will be developed to be used as ET recipients, 2) low quality females will be removed from the gene pool as they are used as recipients 3) breeders will be more willing to make their best genetics for sale in the market place and 4) there will be an enhanced export market where the best genetics can be exported as embryos inside a recipient while simultaneously remaining in your herd. This last point is a twofer 1) you make a high value sale while 2) shipping out one of your lowest quality females.

Here is what Robert Gane of Canchones Alpacas in Victoria, Australia had to say about ET after years of experience and more than 300 ET cria:

The science of ET is now at the point of being well tested and proven. For those who are interested in exploring this option you can visit the ARI website and review a number of scientific papers and presentations that were made at the ARI sponsored Genetic Conference in Houston, Texas.

This is the decidedly low tech component of the three part plan. All this requires to implement is a baling machine and a scale. Most alpaca breeders I know want a check for their fleece. They are tired of fancy value added coops, shipping fleece off with a check to get yarn that they must either process into a product or market in the cottage industry store at their farm. While this may work for some folks it is not the preference of the majority of breeders that I talk to me. Put simply, to become a truly accepted livestock breed we need a cash market for our fleece.

There is an international market for alpaca fleece every day. To access the market the fleece needs to be 1) bailed into 400 pound bales 2) core tested for quality per bale and 3) aggregated in 20,000 to 40,000 pound lots. If these conditions are met fleece becomes a cash commodity. It can be sold greasy based on quality and shipped economically. It takes 40,000 pounds to fill a large container, 20,000 pounds for a small one.

There are currently several fledgling projects underway that have the potential to make access to the cash market a reality. The most advanced and sophisticated plan is sponsored by Australian Alpaca Fleece Limited www.aafl.com.au. Here are excerpts from their plan:

Australian Alpaca Fleece Limited; Experience has proved the need to closely match Australian fleece prices to world alpaca prices. The Board wishes to continue to purchase ALL types and grades of alpaca fleece as a service to Australian growers.

We have adopted a simpler system of paying a flat price per kilo for the WHOLE FLEECE weight, regardless of length, but heavy contamination, lower legs and belly hair should be excluded and placed in rubbish bins.

The fleece will be graded by our expert classers into one of four categories so that a grower purchase price can be set for each fleece.

Category	Expected to have:
X-Fine	73% of the fleece under 22 µ
Fine	57% of the fleece under 22 µ
Medium	11% of the fleece under 22 µ
Adult	2% of the fleece under 22 µ

The following prices in Australian dollars per kg are offered for the 2011/12 season, effective immediately:

	X-Fine ^(*) under 19µ	Fine ^(*) under 22µ	Medium ^(*) under 25.5µ	Adult ^(*) under 32µ
WHITE ^(**)	3.57 _(2.70)	2.96 _(2.19)	1.51 _(0.93)	0.58 _(0.30)
COLOUR ^(**)	2.55 _(1.90)	1.93 _(1.40)	0.26 _(0.15)	0.10 _(0.10)

(*) Prices are A$/kg of whole shorn fleece including neck and pieces, GST excluded.
(**) Includes light fawn 'near-white'.
(Bracketed prices for previous year)

The AAFL Board has decided to offer larger growers and regional groups the opportunity to sell pressed bale lots to AAFL on the basis of independent Australian Wool Testing Authority (AWTA) bale test certification.

Pressed bales over 100 kg and up to 170 kg per bale may be offered to AAFL on the basis of a faxed or emailed AWTA test.
AAFL will then offer to purchase individual bales solely on the basis of the AWTA certificate.

All baled fleece must be classed.
Each bale marked with grower name/AAFL number and bale number.
Pressed clean woolpack bale between 100 - 170 kg, weight marked.
Machine-sampled bale test sent to AWTA
AWTA certificate showing at least:

Mean micron
Micron Standard Deviation (SD)
Micron Coefficient of Variation (CV)
Comfort Factor
Fiber Length

These prices might seem much lower than what you have heard over the years and they may well be too low but they are a start and they have the advantage of being real today. Not a promise of some future payment from a coop who promises to turn your fiber into socks or sweaters if only you will pay ridiculous prices to ship and process your fiber: all before receiving a dime.

These prices are also very sensitive to fleece quality and fineness. If breeders were to sell into a cash market you would see quality on the farm skyrocket in response to higher prices for higher quality fiber. Selection fueled by EPDs and ET would rapidly increase the value of our annual clip. Consider the following potential for prices based on quality.

In addition to the Australian coop prices my research turned up the following market information:

Rachel Hebditch UK Alpaca

In 2012 UK Alpaca will pay £12 plus VAT a kilo for white baby and £8 a kilo plus VAT for white fine. It is graded on handle of course but baby is around 21m and below, fine 22-26m.

For the colors they pay £8 a kilo for baby and £5 a kilo for fine grade, both plus VAT which is 20%.
.
Dawson & Ackroyd (UK cloth manufacturers)

A company called Dawson & Ackroyd (cloth manufacturers) has started to buy raw fleece in the 26 to 30m range and they are paying £5 a kilo including VAT. So far they have collected five and a half tons although this is not yet a commercial quantity for them. (Source Rachel Hebditch)

Alpaca Ultimate is an independent, self funded group buying fleece to make a range of products in Australia and New Zealand.

They are currently buying solid white & light to medium fawn well skirted huacaya fleeces. Prices valid from 1st July 2010.To fit the criteria fleece should be no more than 25.9 micron on a mid side. You must also ensure your fleeces are within the length parameters of 80 - 120mm

The Alpaca Fiber Auction Project: alpacafiberauctionproject@gmail.com; Julie Mae Campbell and Mary Ellen Perry. Their objective is to connect the grower to the commercial alpaca fiber buyers. Many breeders have fewer than 50 alpacas but by combining like fleeces from each herd and creating large quantities of quality alpaca fiber that are attractive to the commercial alpaca fiber buyer. The minimum quantity necessary to make this work is 20,000 pounds.

Julie Mae says “About the auction: The fiber will run through Roswell Wool in Roswell New Mexico. I am dealing with Mike Corn. Roswell has a warehouse here in Long Beach California which makes it easy for me to keep track of this project. The auction is by sealed bid.

To the question what price do I expect, well, if you gave me a lot of room to squirm you might get me to admit to about $5 per pound for grade 3 white. This price is based on conversations I have had with Mike and the current pricing for Mohair and better grade wools, and from conversations with Liz Valkamp, Claudia Raessler, Wini Labreque and Peter Lundborg. All these folks are currently buying alpaca fiber for a variety of projects here in the States.

The interesting question is, have they been paying too much, or getting away with paying too little?”

SuriPacos purchases greasy fleece for cash. They pay $3.00 to $6.00 per pound depending on grade. Claudia and Ken Raessler have been operating this program for several years and they are purchasing more fiber each year. Claudia notes that she has seen fiber quality increase year over year. They often buy small quantities and will negotiate better prices for larger quantities.

I have often heard that their can be no fleece market until we have x number of alpaca; 50,000, 100,000, 200,000 or 500,000. Consider that there are approximately 3,000,000 alpacas worldwide. There are about 250,000 in the United States. That means that if the U.S. decided to create a commercial fiber market as described above they would control almost 10% of the worldwide production. We would produce about 1,250,000 pounds of fiber (250,000 alpacas x 5 pounds per alpaca) with a market value of between $1,875,000 at $1.50 and $6,250,000 $5.00. A more likely economic analysis, especially in the beginning would be to assume that 20% of the clip would sell for $10.00 a pound as baby or better, that 40% would sell at $5.00 a pound at microns from 22 to 27 and that 40% would sell at $1.50 a pound as coarse from 28 microns and up This would be a significant infusion of cash into our industry. The U.S. National clip would be worth the following amount according to this scenario.

50,000 pounds of baby      $400,000.00
100,000 pounds of fine       $500,000.00
100,000 pounds of coarse $150,000.00
Total                               $1,050,000.00

The 3 point plan would accelerate quality based selection decisions using EPDs and ET together with feed back from fleece sales and it would establish alpaca as a legitimate livestock industry.