Batogoo Dorj is a nomad in southern Mongolia’s Bayankhongor Region who makes his living raising cashmere goats. Each spring, Dorj can shear about 300 grams of the valuable, downy wool from each of his 350 goats. Those voracious and sharp-hoofed animals are contributing to the desertification and climate change that is reducing Mongolia’s available grazing land. Yet for Dorj and thousands like him in Mongolia, short-term necessity is eclipsing long-term sustainability.

Cashmere wool is one of Mongolia's most prized animal-product exports. The second-largest cashmere producer (after China), Mongolia accounts for 28 percent of the world's total supply, according to the Mongol Cashmere Association. The wool brings around $180 million annually into the country. For the 36 percent of Mongols who still adhere to a nomadic lifestyle, cashmere is often an integral part of their livelihood.

"Eighty percent of our income is from cashmere. It's the money we earn now [in the spring] that we rely on for the entire year -- to send our kids to school, to stock food, repair things," says Dorj.

It wasn’t always so. The reliance on cashmere is a market-driven phenomenon that first gained momentum after communism's collapse in 1991. Cut off from milk and meat buyers in the former Soviet Union, the herders turned to raising cashmere as one of the only profitable activities available. And without collective farms to manage the animals, individuals began keeping larger flocks, causing the goat population to swell from 5 million in 1990 to almost 20 million by 2009, according to government statistics.

Goats now comprise almost half of Mongolia’s total livestock population, and the population explosion has caused environmental stress, evidenced by overgrazing, pastureland degradation and desertification. At the same time, volatile international cashmere prices have pushed many herders to keep larger flocks as a hedge against falling prices. This year, prices dropped 29 percent to 50,000 tugriks (about $37) per kilo. "It's very hard to plan for the year ahead because the prices are always changing. So many herders keep more animals as insurance against fluctuating market prices," says Dorj.

Changing weather patterns are also prompting herders to keep larger flocks. A severe winter, known as a dzud, in 2009-2010 led to the deaths of over 9 million animals.

Overall, though, temperatures seem to be rising steadily. In 2009, the United Nations Environment Program (UNEP) declared that annual average temperatures in Mongolia have risen by 2.1 degrees Celsius over the last 70 years. The agency also reported a 30 percent decline in surface water over the past 15 years, adding that 90 percent of Mongolia is at risk of becoming desert. (Currently around 17 percent of the country’s landmass is desert.)

While the UNEP is calling for efforts to balance the number of livestock with pasture capacity, many herders balk at the proposition. "Everything is dictated by the market. With cashmere prices falling this year and growing inflation in the country, it's difficult to convince herders to decrease their number of animals, especially goats," said Battur Jigjiddorj, an epidemiologist with the Bayankhongor State Veterinary Support Services who advises herders in the region.

María Fernández-Giménez, a rangeland specialist and associate professor at Colorado State University who has been observing environmental trends in Bayankhongor since 1994, believes that if there is a demonstrated market for "sustainable cashmere,” herders might change their practices. She envisions herders breeding fewer, but higher-quality goats and participating in monitoring to certify their products as organic and fair-trade, which would fetch a higher price for the wool.

"Since the last dzud more herders are talking about the need to increase the quality of their animals rather than increase the quantity," says Fernández-Giménez. The challenge for herders is a lack of access to quality breeding stock. Moreover, they would need to find a market for the finer wool.

Dorj said he's ready to make the trade, but the final decision comes down to money: "It's only if herders can earn a decent livelihood that they can start thinking about the environment."