Investing in Peruvian alpacas

Oikocredit supports the traditional farming of alpacas, a South American herd animal and cousin of the llama. Alpacas live in high altitude areas, between 3,500 to 5,000 metres above sea level in the Peruvian Andes and are traditionally farmed for their high quality wool.

Alpaca farmers often live in remote areas with harsh, cold climates. Those with smaller herds tend to have low incomes, and live in clay houses with no power to be close to their herd. Many farmers are unable to invest in medication or better food for their alpacas. They struggle commercially because they lack access to the market or have little negotiation power to sell their wool.

Alpaca farmer Nicomedes Cochama Yava in his house

Oikocredit recently partnered with Cooperativa de Produccion y Servicios Especiales de los Productores de Camelidos Andinos Ltda (COOPECAN) to support this traditional farming sector and contribute to the social development of alpaca farmers.

COOPECAN works with around 2,000 alpaca farmers and their families, encouraging economic, social and environmental development. Membership of COOPECAN gives farmers access to fair prices for their wool, as well as services to help improve the quality of the wool and health of the alpacas.

Oikocredit country manager for Peru and agricultural specialist, Carina Torres, has worked closely with COOPECAN since it partnered with Oikocredit last year. Carina has visited many of the farmers to see first-hand their living conditions and how COOPECAN works with them.

“When I first visited the alpaca farmers, or as we say, ‘alpaqueros’, I saw why these farmers needed a cooperative like COOPECAN,” Carina explained. “Many baby alpacas were dying or getting sick which meant farmers couldn’t earn enough money to support their families or sold their wool to intermediaries for a very low price,” said Carina.

Membership of COOPECAN  provides farmers with services such as better medication for sick animals or the improvement of grass lands so the alpacas have better feed, resulting in better and higher quality wool.

This is the case for alpaca farmer, Nicomedes Cochama Yava (pictured), who has benefitted greatly by being a member of the cooperative. Nicomedes lives in the mountains with his herd while his wife and eight children live three and a half hours away in Sicuani.

Even though Nicomedes owns 200 alpacas, a herd that should be large enough for one family, he did not earn enough money to pay for his expenses and send his children to school. Nicomedes became a member of COOPECAN to get a guaranteed better price for his wool as well as services to help him improve the quality of his herd’s wool and earn enough money to provide for his family.

COOPECAN  pays the farmers a better price for their wool, and members are also given additional payments once the wool has been processed and sold. They employ around 12 people who dye and knit the wool to make garments for export. Most of these garments are sold to a buyer in Italy with the rest sold on the local Peruvian market.

Oikocredit provided a credit line of US$ 150,000 to the cooperative to improve its wool collection services and support its daily operations and social mission. At the end of October 2013, a loan of US$ 530,000 was approved to Coopecan for a 7year term from the date of disbursement. The main purpose of this credit is for the purchase of machinery to process alpaca fiber.

Here is a link to a small video - the making of alpaca garments by COOPECAN and its last participation in Peru Moda 2013.

Get in touch

Oikocredit South America, Northern Region
Edificio Centro Empresarial Peruano-Suizo
Av. Aramburu N° 166 Of. 5 “A” Miraflores
Lima 18 - Perú