Alpacas As an Alternative Livestock Investment

We are currently witnessing a huge turmoil and downward trend in the worldwide credit and stock markets. There are millions of people, who will read the quarterly reports on the losses inflicted in their 401K savings. Many people fear that the traditional investments in stocks, bonds, and real estate will get much worse before they get better, and that we all may be teetering on the edge of a multi-year worldwide depression.

Against this economic backdrop, the investment that I made five years ago in starting an alpaca ranch looks pretty darn good. Since that time, I have “diversified” my investment by adding miniature llamas and dairy goats. I can confidently say, that not only have I been able to sell alpacas and llamas every year that I have been in business, but I continue to get inquiries from well-qualified customers, who want to know how to start an alpaca ranch and how to make money with an investment in alternative livestock. Indeed, I get more inquiries that I have livestock to sell.

Unlike stock and bond prices, which can fluctuate up and down (mostly down these days!), investments in alternative livestock have remained fairly stable because alternative livestock are rare commodities. That is, unlike millions of heads of traditional livestock, such as cattle and sheep, there are less than 200,000 alpacas and 300,000 llamas in the USA. For miniature llamas, there are fewer than 700 in the USA! So demand still outstrips supply for these animals.

Active or Passive Investment

Before investing in alternative livestock, you must consider if you want to go in as an active or passive investor. An active investor is one, who actively participates in the management of the animals. Usually this means that you own an alpaca ranch and manage the day-to-day operation of the herd. However this could also include, who board their animals, yet still participate in management aspects, such as breeding decisions, shearing, and monthly worming. Passive investment means that you board the animals and leave all the animal management to someone else. For passive investors, the profit comes mainly from the sale of animals and their offspring and the animal by-products.

If you are going to be an active investor, that is become an alpaca rancher, then this is probably going to mean a major lifestyle change. In which case, you will need to educate yourself about all the ins and out of alpaca and llama ranching. This is not an impossible or even a difficult task, but there is a learning curve. You’ll need to know about alpaca health and nutrition issues, breeding and birthing, optimizing pasture grass production, alpaca fiber, and marketing fiber and yarn. In addition to visiting alpaca ranches and asking questions, you’ll also want to take some workshops and read about the alpaca and llama industry in books, such as the Start Raising Alpacas Guide Book.

Product Potential of Alternative Livestock

An important consideration for investment in alternative livestock is understanding what potential products can be harvested from the animals. Then you need to create your own vertical market, where you harvest the raw fiber and add value to it to create end-products that you sell for greater prices. That is, you take the raw fleece and have it spun into yarn. Then you have the yarn made into apparel and home decor items. There are buyers of the fiber at every step from raw fiber to a finished apparel, but the profit margins increase with every step towards the finished luxuriously soft apparel.

The market for llama fiber is a little different than for alpaca fiber. Llama fiber tends to be coarser than alpaca fiber, but the really coarse hairs can be “dehaired,” or completely removed, in the yarn spinning process. However there are still many wonderful products that you can create with llama fiber, such as outer garments that do not touch the skin, bags, rugs, etc. I like to combine my coarser alpaca fiber from the leg and neck area with my llama fiber, which I spun into bulky yarn for rugs.

Why You Should Use A Professional Livestock Agent

If you have livestock for sale, using a professional agent is a smart move. Livestock agents arrange the buying and selling of cattle, as well as giving you advice on cattle, farming supplies and stock market trends. Their knowledge of farm management and cattle, combined with your local knowledge of your own situation, will create a bigger picture and provide all the necessary information you need to make the right decisions.

Employing the services of a professional agent when you have livestock for sale means you will be saved from a lot of tedious paper work including the organising of import and export licences, documentation, freight and insurance, health testing and inspections. The whole process of selling your cattle, whether it be domestically or internationally, will be more efficient when you use the expertise of an experienced professional livestock agent.

Livestock agents are skilled in assessing the value of your cattle. They will visit your farm to assess the weight and condition of the animals you have ready for sale. They can also buy and sell on your behalf on farms and through the auction process and arrange transport of animals to and from the farm. That leaves you plenty of time to get on with the business of keeping your business running smoothly.

A professional livestock agent is someone you can rely on to be hard working, honest, friendly, patient and confident in the role. Their wide range of experience on a variety of farms and at numerous stock sales means they have a good overview of the situation and can offer down to earth advice. The livestock agent wants to keep the farmer happy, so you will be assured of their commitment and full attention. When you phone to say you have some livestock for sale, the agent will arrange a time to come to your farm, have a look at the animals and discuss the selling options with you. This could include selling at auction, selling privately or selling to the meat works. You will receive an approximate price, and it’s up to you whether to accept that or try for something more. Your professional livestock agent will get you the best possible deal.

It makes sense to let a professional do the job for you. They have the experience, the contacts and an ear to the ground. Having a professional livestock agent on your team is a great way to do business.

How to Get Into the Livestock Export Industry

Despite the vegetarian movements in many parts of the world, meat lovers are rising in number every day. It has not only turned the attention of agricultural scientists towards sources of meat, but has also given a new dimension to the livestock trade worldwide. Argentina, Brazil and New Zealand, once the hub of milk and meat industry are threatened by rising livestock sectors in other developing world. While the Scandinavian countries are busy in expanding their milk and milk products industry across the world, South Asia is trying to capture the livestock markets of Europe and Middle East. Overall the world food trade balance is tilting fast towards developing world mainly due to the demand of more palatable variety and lesser labor cost inputs. Nevertheless, livestock traders all over the world can change their fortunes by simply carrying out a SWOT analysis of the situation and adjusting accordingly.

While an exporter plans indulging into livestock sector, he must carry out an analysis of various factors in both demand and supply markets, identify the best advertisement mechanism and explore the most promising trade routes. To begin with, understanding and analyzing following is necessary.

a. Consider the size of market before you choose to start your exports. Bigger markets are not necessarily the best places to sell; instead lesser number of competitors should be your preference initially. While it would be difficult to make a niche in a big market, alternatively it will be easier to capture a slot in less competitive area by providing a better variety.

b. Next choose the breed that you want to trade in. People in different areas have different taste preferences and more than anything else people’s taste should be the deciding factor for your choice of breed. Do not forget to include breeds resembling with the most wanted one in the list of your supplies. You can not only cut on your supply costs (as generally the other breeds are most likely to be less expensive) but also count them as your reserve in case you don’t find the required supplies at some time. This is essential in order to keep the market in grip during your bad days and not to allow your competitors to have a clean sweep.

c. Now find your supply areas. While you choose your suppliers, consider their location, commuting route to your rallying point, flock size and general profile of your suppliers. You cannot afford to accommodate ailing and diseased animals as the results would be disastrous. Your supplier should preferably be certified by Veterinary Department of the state.

d. Locating your collection points can be decided on the basis of above factors. While you may have many collection points in country side as an option, try finding a supplier who could deliver the animals to your place initially. It may be expensive, but will rid you of transportation worries and allows you more time to concentrate on more important things in the initial days of your business. You must recruit workers locally. They are inexpensive and can provide you information which may be helpful for your efficient management.

Although the intricacies of business need a lot more to plan, above mentioned guidance can help in establishing an outline of your working plan. It is always advisable to seek help from livestock ministry (if any in your country/state) and commerce ministry before you launch your business activity. A careful planning and a dedicated work are sure to give you initial success, but it is your strategic vision which is ultimately going to decide your fate in livestock export. Like other businesses, you are strongly advised not to be carried away by the territorial limitations. Modern trade focuses on efficiency and competition, and hence calls for beyond the country’s limits thinking; negligence can cause your name a damage that may have long lasting negative repercussions for you.

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