Prepping and spinning this amazing fiber
Alpaca is a popular fiber, with good reason. It is soft and lofty, much warmer than wool, and affordable (especially in the world of luxury fibers).
From a spinner's perspective, alpaca poses some unusual challenges. Much like silk, alpaca fiber has very little crimp to it, which means that a 100% alpaca yarn will have very little "bounce" or memory. For this reason, many spinners choose to blend alpaca with wool. Merino wool is most often chosen for the mix, since its fine micron diameter makes it a good match for alpaca.
In my experience, alpaca also tends to have more bits of straw and other VM. Presumably because it doesn't require as much washing as wool (and in fact will felt very easily by mistake), and because the fineness of the fibers can catch and hold the VM so very well.
Alpaca also takes a lot of twist to hold together. (Again, like silk.) How much more twist will depend on your blend, your spinning style, and what kind of yarn you want. As a general rule, add more twist than you think it should take, then ply off a sample skein and see what you think.
Be sure to wash your sample skein before making your judgments! I have often been surprised at what happens when a few sample yards of yarn hits the water and softens up.
Because the fiber lacks crimp and scales (which is what makes it so soft), alpaca can also be a little more difficult to join. Be sure to give it plenty of room for the join, and hang on carefully until you are sure the fibers have "caught."