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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. So there's this video

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Speaker 1: I want to tell you about. It's from a high

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Speaker 1: end Italian garment company called Loro Piano, and it's set

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Speaker 1: to this ethereal music and it shows the softly lit,

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Speaker 1: dramatic footage of the Andes Mountains. The goal is to

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Speaker 1: give an impression of how the company sources and processes

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Speaker 1: its most valuable material, the wool of a wild lama

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Speaker 1: like creature called the vicunya. You see them running free

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Speaker 1: in the video. You hear the faint sound of hoofs

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Speaker 1: beating against dry mountain soil, and you see shots of

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Speaker 1: indigenous communities who have lived with the vicuna since the

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Speaker 1: days of the Incas the company, Loro Piano doesn't say

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Speaker 1: anything in the video. In fact, there's no dialogue at all,

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Speaker 1: and as my colleague Marcelo rosche Brun, Bloomberg's Lima bureau chief,

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Speaker 1: told me, that's part of the company's appeal.

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Speaker 2: What Lorda Piano is known for is that they make

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Speaker 2: what is now known as quiet luxury. That is, garments

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Speaker 2: that are really expensive, really looks serious, but they don't

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Speaker 2: necessarily look that shiny, or they don't necessarily look that

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Speaker 2: different than any other garment you might have. It's sort

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Speaker 2: of a very subtle if you know, you know, this

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Speaker 2: is very expensive.

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Speaker 1: The brand is known for these kinds of understated, high

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Speaker 1: quality items. A pair of their cashmere sweatpants will run

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Speaker 1: you about three grand. Kendall roy Or a logo list

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Speaker 1: loro piano baseball cap on the TV show Succession, and

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Speaker 1: the sweaters they make from the wool of the galloping

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Speaker 1: Vikunyas in the video have price tags upwards of nine

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Speaker 1: thousand dollars. But intertwined with its quiet luxury are the

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Speaker 1: fates of some of the poorest communities in Peru.

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Speaker 2: Viquinyas live very high. They can live at twelve thousand feet.

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Speaker 2: Indigenous communities that live in the end is at twelve

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Speaker 2: thousand feet and to be very poor. There has to

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Speaker 2: be a big contrast here between the wealth of the

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Speaker 2: people who live near Vicunas and the people who get

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Speaker 2: to wear Vicuna garnments. What happens if I actually follow

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Speaker 2: this connection? What would I find today?

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Speaker 1: On the show? An Italian fashion company, a once endangered

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Speaker 1: South American species, a remote Andean community, and a plan

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Speaker 1: that was supposed to help them all prosper and why

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Speaker 1: thirty years later it hasn't exactly worked out that way.

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Speaker 1: I'm Sarah Holder, and this is the big take from

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Speaker 1: Bloomberg News. Getting close enough to catch and share of

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Speaker 1: acunya is not easy.

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Speaker 2: They are way faster than a human.

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Speaker 1: It's a process indigenous communities have been refining since the

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Speaker 1: days of the Incan Empire.

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Speaker 2: So indigenous communities will usually share vicunyas once a year,

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Speaker 2: and so they called this a chaku, which is a

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Speaker 2: ketcher where that has been in use for centuries.

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Speaker 1: Marcelo made the ten hour trip from Lima to Lucanas,

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Speaker 1: a town in the southern Andanties, to see a chaku

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Speaker 1: up close.

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Speaker 2: We actually walked all these miles in this part of Peru,

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Speaker 2: which is called Pampa Galleas, which is a national reserve

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Speaker 2: dedicated to the Vicunyans, and it is at about twelve

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Speaker 2: thousand feet and it is really intense work to be

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Speaker 2: able to walk miles and miles closing in on Vicunyans

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Speaker 2: at this altitude. I don't know how easy it is

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Speaker 2: to picture this, but it's a huge triangle with miles

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Speaker 2: in length, and you carry a rope or a fence

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Speaker 2: and you start closing in on the animals. You are

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Speaker 2: surrounding their territory from far away, a distance enough that

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Speaker 2: vicunyas will initially not realize that they are being encircled.

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Speaker 2: But that is what is happening here, just making the

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Speaker 2: circle or this triangle smaller and smaller as you go.

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Speaker 2: So what you see is that as humans are walking

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Speaker 2: in in one direction, the viquinas were just running in

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Speaker 2: the other there and what's on the other side is

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Speaker 2: a cage, so they will just walk into there and

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Speaker 2: be trapped.

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Speaker 1: And once they get to the cage, workers are waiting

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Speaker 1: for them. I asked Marcelo whether he had touched a vacunya.

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Speaker 2: I have touched a vikunya. I don't think the viqunya

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Speaker 2: enjoyed it. But they are so soft, they're so fluffy.

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Speaker 2: It feels like you're touching a cloud, like and I

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Speaker 2: know that nobody knows what. Yeah, you cannot touch a cloud,

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Speaker 2: but it's just in my head. It's like the idea

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Speaker 2: of what it would feel if you could touch a cloud.

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Speaker 1: It takes a small group of people to share a vacunya.

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Speaker 1: One to grab the head and one to grab the legs.

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Speaker 1: They take the vicunyas, lay them on their sides and

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Speaker 1: hold them down as someone else shears layers of their

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Speaker 1: golden brown bowl. Then the workers flip the vicunya back

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Speaker 1: up onto its feet and it goes running off back

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Speaker 1: into the wild, stunned and stressed, but otherwise unharmed. At

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Speaker 1: the Chaku Marcelo attended. The man overseeing the shearing was

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Speaker 1: Abraham Waman. He's been working with the Kunyas in the

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Speaker 1: community of Lucanas for almost twenty five years.

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Speaker 3: Well, for me, it's like a treasure because sometimes an

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Speaker 3: animal with wool runs the risk of poachers in other

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Speaker 3: place is for example, there are poachers who kill the

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Speaker 3: vicunyas and take their wool. They take the skin and

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Speaker 3: the wool. But an animal that is already cheered, that

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Speaker 3: doesn't have any wool left is basically a safe animal.

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Speaker 1: In other words, a vicunya sheared is a vicuna saved.

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Speaker 1: At one point, the animals were so heavily poached that

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Speaker 1: the species was on the brink of extinction, and a

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Speaker 1: bunch of Andian countries signed a treaty to protect.

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Speaker 2: Them that said two key things. When was it banned

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Speaker 2: any trade of vicunya wool for the foreseeable future until

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Speaker 2: the species could recover somewhat, and then the other one

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Speaker 2: was that it declared explicitly that vicunas would be used

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Speaker 2: economically for the benefit of the people of the Andes

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Speaker 2: in the future when the species.

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Speaker 1: Had recovered and it worked. By the eighties, the population

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Speaker 1: had rebounded and people started arguing that it was time

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Speaker 1: to make the trade of a cunyu woll legal again.

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Speaker 1: One of those voices was the maker of the nine

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Speaker 1: thousand dollars sweater.

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Speaker 2: And that's when Lorda Piana comes in, or at least

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Speaker 2: when Loda Piano comes in in the modern history of

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Speaker 2: the of the Vicunya, and they start to lobby the government,

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Speaker 2: the proving government, trying to find a way to get

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Speaker 2: legal access to the vicuna.

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Speaker 1: Eventually, the government agreed they brought back the sale of

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Speaker 1: a cuniu woll, with some conditions.

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Speaker 2: So only communities legally recognized by the government who shared

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Speaker 2: territory with vicunyas are able to capture and chear them.

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Speaker 2: So a company like Loda Piana has to go through

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Speaker 2: an indigenous community. The indigenous community will share the wold

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Speaker 2: for free, and then Lorda Piana will buy that wol

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Speaker 2: from the indigenous community, giving it significant cash for the

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Speaker 2: economic progress of the place.

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Speaker 1: The government ended up awarding one group of garment manufactures

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Speaker 1: legal access to Vacunya woll.

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Speaker 2: Lorda Piana wins this as part of a conglomerate that

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Speaker 2: includes two other companies, but Lordapiana is that is the

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Speaker 2: main one, and then Lorda Piana becomes the preeminent player

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Speaker 2: in the new legal vicuna market. And in fact, the

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Speaker 2: very first place where vicunas were shared legally once again

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Speaker 2: in nineteen ninety four was in Lucanas, the community that

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Speaker 2: we visited.

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Speaker 1: That first newly legalized vacunya sharing was a big deal,

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Speaker 1: such a big deal that the President of Peru even attended.

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Speaker 1: It marked the start of a promising new chapter in

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Speaker 1: the history of Acunya Woll and the Andes. Under the

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Speaker 1: new treaty, the Viacunya population was flourishing, the woll was

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Speaker 1: creating a new source of income in Peru's poorest region,

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Speaker 1: and Laura Piana had a monopoly the world's most premium fiber.

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Speaker 1: After the break, how it all fell apart leading up

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Speaker 1: to the nineteen seventies, Vicunas were on the brink of extinction,

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Speaker 1: but a treaty signed by many of the Andean nations

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Speaker 1: to pause the trade of their wool helped the population

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Speaker 1: roar back to life. The trade in vacunya wol resumed

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Speaker 1: in nineteen ninety four under provisions that the industry would

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Speaker 1: be structured to benefit indigenous communities, but in two thousand,

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Speaker 1: the Peruvian government made a change that would let private

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Speaker 1: companies cut indigenous communities out of the vicuna wool market.

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Speaker 1: The change made it possible for any landowner to shear

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Speaker 1: the wool of a vicunya that set foot on their property.

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Speaker 1: That meant companies could buy cheap land in the Antes

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Speaker 1: and shear vicunas without having to pay indigenous communities.

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Speaker 2: This change was made in the year two thousand by

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Speaker 2: a man called Alfonso Martinez.

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Speaker 1: Alfonso Martinez was the head of the government office that

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Speaker 1: was created to regulate the new vicunya wall market, and

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Speaker 1: records show that behind the scenes he lobbied hard for this.

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Speaker 2: Change, and Alfonso Martinez goes on a few years later

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Speaker 2: to become the CEO of Loda Piana in Peru.

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Speaker 1: After the change in regulation and with Alfonso Martinez. Leading

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Speaker 1: up their Peruvian operations, Loro Piana bought about five thousand

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Speaker 1: acres of land in the Andes near Lucanas.

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Speaker 2: What that land enables you to do is you can

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Speaker 2: put some vicunas in there and then you can fence

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Speaker 2: the area, and this is allowed by Peruvian law, but

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Speaker 2: it is a system that ensures that those vicunas cannot

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Speaker 2: leave your land and that they cannot be shared by

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Speaker 2: anybody else. And so Loda Piana has records show about

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Speaker 2: two thousand vicunas in this part of Peru that it

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Speaker 2: cheers every year. The records are public because they have

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Speaker 2: to be filed with the Wildlife Regulator, and so Loda

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Speaker 2: Piana is able to get this vicuna fiber without having

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Speaker 2: to pay for it, either to any indigenous community or

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Speaker 2: to anybody else.

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Speaker 1: Does that fly in the face of the intent of

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Speaker 1: the original treaty, which was supposed to allow indigenous communities

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Speaker 1: to economically benefit from the vicunas.

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Speaker 2: Yeah, it definitely creates a competitor for the vicunya market.

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Speaker 2: Indigenous communities used to have this source of revenue in

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Speaker 2: the vicunya, but now it turns out that companies can

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Speaker 2: go and get their own in a way like the

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Speaker 2: property of the vicunya is officially still in the hands

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Speaker 2: of the state. You cannot have you cannot own vicunas.

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Speaker 2: But what you have our rights to use the fur,

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Speaker 2: the fiber that those animals have. And so now you

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Speaker 2: have companies being able to share that fiber because they

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Speaker 2: are they have privately owned land and they have vicunas

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Speaker 2: in there.

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Speaker 1: Lro Piana's permit to start sharing vacunyas on its own

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Speaker 1: land was approved in twenty and since then it's been

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Speaker 1: buying less vacunia wool from Lucanas and paying lower prices

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Speaker 1: for what it does buy. All of this has meant

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Speaker 1: less money for the community. Records show that in twenty fifteen,

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Speaker 1: Loro Piana paid the community nearly four hundred thousand dollars

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Speaker 1: for vacuna wool. Seven years later, the company bought only

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Speaker 1: one hundred and fifty thousand dollars worth. Meanwhile, the prices

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Speaker 1: Loro Piana charges for its vacuna garments, like the nine

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Speaker 1: thousand dollars sweaters and thirty three thousand dollars coats, have

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Speaker 1: only continued to climb. Marcelo asks Abraham Woman, the man

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Speaker 1: leading the sharing in Lucanas about how that gap feels.

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Speaker 2: Comotesas and tipto, proper conditions sink and fifteen.

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Speaker 3: It's a deception something we feel in this community and

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Speaker 3: other communities. They buy it at a low price but

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Speaker 3: sell it at a higher price after transforming it into

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Speaker 3: vacunyabole garments.

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Speaker 1: Marcelo reached out to Lro Piana and they said, quote,

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Speaker 1: since it arrived in Peru in the eighties, Laura Piana

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Speaker 1: has been committed to upholding the highest standards of ethical

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Speaker 1: and responsible business practices. Laura Piana represents a key economic

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Speaker 1: support locally protecting and fortifying the demand and the value

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Speaker 1: of the vacuna fiber regardless of market dynamics. So is

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Speaker 1: there another path here? Could the local community make money

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Speaker 1: from the vacuna wool without working with existing brands. Why

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Speaker 1: can't indigenous communities just process the wole they're sharing on

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Speaker 1: their own and sell their own luxury garments.

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Speaker 2: Yeah, that is one of the keys to the issue, right,

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Speaker 2: And there are two problems here. One of them is

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Speaker 2: just lack of access to resources. Spinning vicuna fiber is

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Speaker 2: not easy just because it is so fine. Indigenous communities

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Speaker 2: are very good at weaving alpaca. They can weave lama,

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Speaker 2: but in the case of the vicuna, it is both

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Speaker 2: very fine and very short. The fibers themselves are not

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Speaker 2: that long, so you need very expensive machinery that is

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Speaker 2: not common available because vicunia is so rare. And then

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Speaker 2: the second challenge is that even if an indigenous community

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Speaker 2: could have access to this machinery could make garments, it

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Speaker 2: is hard to sell elite products that are worth thousands

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Speaker 2: of dollars unless you have the right marketing, the right connection,

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Speaker 2: the right reputation. I think the story about the vicuna

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Speaker 2: is emblematic of a lot of struggles in countries like

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Speaker 2: Peru and other countries in the Global South about having

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Speaker 2: raw materials, being the producer of important and expensive raw materials,

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Speaker 2: but then not being able to capture the value of

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Speaker 2: what those materials are worth when they are converted into

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Speaker 2: something else.

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Speaker 1: So has this treaty, the Vicunya Convention worked.

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Speaker 2: The treaty is still in place. The Vicuna population has

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Speaker 2: grown very significantly in recent years. Prue's last Vicunya census

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Speaker 2: was in twenty twelve and it had two hundred thousand Vicunas.

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Speaker 2: So compare that to what it had in the nineteen

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Speaker 2: fifties and sixties, when the entire world population of Yukunyas

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Speaker 2: was ten thousand. It has increased massively, so it is

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Speaker 2: a successful case of the preservation of his species on

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Speaker 2: the brink of extinction. But on the other hand, as

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Speaker 2: it led to the progress of the people of the Andes,

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Speaker 2: you cannot say that it has done very much. The

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Speaker 2: Andes remained the poorest region in the entire country and

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Speaker 2: people are still working mostly as subsistence farmers.

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Speaker 1: This is the Big Take from Bloomberg News. I'm Sarah Holder.

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Speaker 1: This episode was produced by David Fox. It was edited

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Speaker 1: by Caitlin Kenny and Daniel Ferrara, with additional support from

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Speaker 1: Aaron Edwards. It was mixed by Ben O'Brien. It was

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Speaker 1: fact checked by Stacy Renee. Our senior producers are Naomi

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Speaker 1: Shavin and Elizabeth Ponso. Nicole Beemsterbor is our executive producer.

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Speaker 1: to Julianne Wilkinson and Bianca Rosario Ramirez. Thanks for listening.

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