Investing in Alpacas

     The alpaca is potentially an excellent investment which can generate a very positive annual return as well as provide first rate tax advantages.

      There are numerous ways to invest.  You can start out with as few as two bred females on a small acreage, choosing to care for them yourself.  Before long, the size of your herd will increase dramatically.  Many breeders are happy to offer financing, usually on a short term basis. Be creative.  When we purchased our original core herd, our then teenaged children invested some of their college fund in one of the bred females.  After she had 2 offspring we sold the original girl, our kids got their full investment back, and her cria are now grown and having offspring of their own.

      If you don't have the desire to raise them yourself, or are lacking the time or acreage, you may want to agist, or board your alpacas with an established ranch.  The fees are reasonable and a tax-deductible expense. In this way, you needn't concern yourself with the day-to-day care, but can still enjoy making the breeding and selling decisions.

      Alpacas are extemely hardy, easy to raise and they are fully insurable against loss, providing you with the added security you may desire.  With the small number of alpacas currently available in North America, there will be a continuing demand for breeding stock to meet the needs of our flourishing industry.  The demand for them exceeds the supply and has continued to increase yearly.  This demand plus restricted importation and the alpaca's slow reproduction rate creates a market where prices are high and stable.  We expect this to continue for many more years.

      There are very desirable tax advantages to raising or agisting alpacas.   As a breeder, you can depreciate a male or female alpaca used for breeding purposes over a five year period. Any expenses which you incur, such as barn or pasture improvement, veterinary care, breeding fees, feed bills, or any other costs associated with your alpaca business, are deductible.  Your ranch may generate taxable losses that can be used to offset taxable income from other sources.  If you agist your animals the tax advantages are alsovery attractive, but will vary somewhat from that of an active ranch owner.   We strongly suggest that you meet with a tax advisor who is familiar with breeding livestock and ranching issues.

      The raising of alpacas is both a financial and lifestyle investment.  We think it's a great business!