BY THE middle of May, the snowline in Yushu prefecture has retreated to the peaks of its steep valleys. Nomads who have spent the winter at the bottom of them have begun to herd their yaks and goats to higher pastures, where the first shoots of green have replaced the scorching white of winter. The landscape is still bleak and forbidding. Wolves prowl. Lightning strikes terrorise those caught exposed on the bare slopes.

Yushu is a vast area of mountains and alpine pasture, larger than Syria but with a population of fewer than 400,000 people (see map below). About 95% are Tibetans, who call the area Yulshul. For those living in the countryside—more than half of them—this is the busiest time of year. Elsewhere, in China’s densely populated interior, children get a short break to celebrate Labour Day on May 1st. But in Yushu, as in many other rural settlements across the Tibetan plateau (a sparsely inhabited region the size of western Europe), schoolchildren are given an additional four weeks’ holiday in May and June. They have to make up for it with a shorter summer holiday. And it is not for the sake of fun.

Children are at the front line of the armies of Tibetans (almost every able-bodied rural resident in Yushu) who will spend a frenzied month scouring the hills for what they call yartsa gunbu. In Chinese its name is dongchong xiacao, literally “winter-insect-summer-grass”, for that is what it resembles.

In summer the airborne spores of a fungus known as cordyceps (or ophiocordyceps) sinensis invade the caterpillars of various species of ghost moth, a large pale insect that flits over the pastures at dusk. After grubs thus infected bury themselves in the soil to hibernate, they die; when winter comes they freeze. The warmth of spring activates the fungus, which grows to fill the caterpillar’s entire body, leaving only the outer skin. A spindly brown shoot of it emerges from the caterpillar’s head and pushes its way through the soil into daylight: just four or five centimetres—so tiny and often so widely separated from others that the keenest of eyes are needed to spot it.

This is Tibet’s annual gold rush. Yartsa gunbu is so highly valued as a medicine that it often sells for more than its weight in the metal. It has many purported benefits, ranging from preventing cancer to curing back pain. But what makes it so prized is its supposed ability to improve sex lives. It is often described as a “Himalayan Viagra”, good for treating erectile dysfunction and (in women as well) low libido.

The children’s good eyesight and short stature make them the best spotters of the fungus among blades of grass and stalks of ground-hugging cinquefoil shrubs that soon, as the weather warms, will dot the slopes with bright yellow flowers. It is not a job for those unused to the plateau’s thin air. Caterpillar fungus, as yartsa gunbu is usually called in English, is generally found at altitudes above 4,000 metres (13,100 feet). That is higher than Lhasa, the capital of the Tibet Autonomous Region (TAR) which borders on Yushu and occupies about half of the plateau.

Flat out on the plateau As your (ill-acclimatised) correspondent found, ascending the steep slopes of Yaseeda ridge in Yushu’s Chindu county requires nimble limbs as well as the genetic advantage Tibetans enjoy at such elevations, where there is 40% less oxygen than at sea level. His agile guides were sporting enough to let him rest as his heart pounded in a desperate quest for atmospheric sustenance. Throughout the month of May each year, hundreds of villagers search through the scraggy vegetation looking for the precious fungus. Mayong Gasong Qiuding, a local guide, crawls on his hands and knees. At the start of the season, he says, he would spot one fungus every 15 minutes or so. By the end, it would be one every couple of hours. Digging them up requires painstaking effort. A small pick is used, with great care taken not to break the sprout from the caterpillar’s body. There is little demand for separated pieces; yartsa gunbu is dried and consumed whole. Aficionados gauge the quality of a caterpillar fungus based partly on the relative lengths of body and sprout—impossible if there is no way of being sure whether they were once attached. Fungus-hunters often camp out on the hills. Mr Mayong says a diet of dried yak-meat and instant noodles (a product of China’s spreading culinary influence: balls of roast barley flour, known as tsampa, are the cultural norm) keeps him going from dawn to dusk. Plastic sheeting provides makeshift shelter from rain. Dried yak dung (no shortage of that on the slopes) and the withered stalks of cinquefoil provide fuel for cooking.

On top of the world

Later, at his house in Xiewu township, Mr Mayong points out a man high up on a slope above his house—barely a speck, surrounded by other specks that are the man’s yaks. “That is probably my brother,” he says. Searching for caterpillar fungus may be tough and sometimes dangerous. (“If a bear comes, the best thing to do is run,” he suggests.) But it is much more lucrative than tending yaks, which provide a subsistence living at best. Rural incomes in Tibet are among the lowest in China. Herders live hand to mouth, or at least they did until the 1990s when the price of yartsa gunbu began to soar. Since then an explosion of demand, almost entirely from non-Tibetan parts of China, has transformed the economy of large swathes of the Tibetan plateau. Daniel Winkler, a fungus expert who runs Mushroaming, a Seattle-based travel agency, and who has done extensive research on this, says caterpillar fungus has entwined the plateau’s economy with that of the rest of China in a way that few other products have—there is little else made in Tibetan areas that is in such high demand elsewhere.

It is all the more remarkable for having remained largely a Tibetan preserve: despite much effort, no one has yet succeeded in producing commercially viable quantities of good-quality yartsa gunbu in artificial conditions. This means colossal dividends for Tibetans. In the TAR the retail value of the more than 50 tonnes of yartsa gunbu harvested there in 2013 was around 7.5 billion yuan ($1.2 billion), equivalent to nearly half its earnings from tourism. Total annual production on and around the plateau, most in China but also in Nepal and Bhutan, is worth several times more.

It is omnipresent: at the airport in Xining, the capital of Qinghai province, huge advertisements for the stuff fill the arrivals hall. The streets of tourist areas of towns and cities across the region are lined with shops selling it. A souvenir shop in Yushu sells freeze-dried yak meat; the price would seem ridiculous, were it not (perhaps) for the large characters on the box: “Fed on caterpillar fungus”. Over large areas of the Tibetan plateau, about 40% of rural residents’ annual cash incomes have been generated by the fungus in recent years. Tibetans’ income from farming (including fungus-gathering) has usually risen faster than the farming income of rural residents in other parts of China.

This windfall is the result of the rapid emergence of a middle class in other parts of China, and with it a big growth in spending power on health products—not least those that claim to help with erections. The Chinese often appear not to share Westerners’ embarrassment about such medicaments; a good sex life is seen as evidence of overall health. One high-class restaurant in Beijing specialises in animal penises, the eating of which is supposed to boost virility. Westerners visit for a titter, Chinese businessmen to impress their clients. (Yak penis, says the eatery’s website, is a “luxury gift for close friends”.) A book of “traditional, health-preserving” recipes on sale in one of Beijing’s biggest state-run bookshops includes the following remedy for impotence and premature ejaculation: “18 grams of caterpillar fungus; one fresh human placenta. Wash the caterpillar fungus and the placenta separately. Place in a saucepan, with water. Stew at high temperature until the placenta is cooked. (Drink the human placenta soup once a week for one or two weeks to see results.)”

Caterpillar fungus may even have been the salvation of Tibet’s pastoral way of life (or what remains of it after the forcible settlement of many nomads by the government). In the rest of China, less than half the population now works on farms. On the Tibetan plateau, which is home to around 6m people, the share raising animals or growing crops fell only slightly between 2000 and 2010, from 87% to 83%. Andreas Gruschke of the University of Leipzig says yartsa gunbu has provided some herders with enough extra income to make yak-rearing viable. It certainly helped in Yushu after an earthquake in 2010, which flattened much of the main town of Gyegu (or Yushu city) and killed more than 2,600 people. To aid the area’s battered economy, the government launched an annual “caterpillar-fungus culture festival”—a trade fair, in effect, attracting buyers from across the plateau (prices are often decided by a coded touch of hands under a cloth, to keep rivals in the dark).

But clouds hang over the industry, and are looking ever more ominous. Fakes, sometimes dangerous, are becoming increasingly ubiquitous, threatening consumer confidence. Your correspondent bought two caterpillar fungi from a Tibetan in Gyegu’s main square for what seemed a bargain price of 50 yuan. Later he accidentally dropped them on the floor of his hotel room; they snapped, revealing that they were made of plaster moulded onto tiny sticks. To boost demand for the fungus, some merchants adulterate products made of it with Viagra, or Weige (Mighty Brother), as it is more suggestively named in Chinese. Wholesalers—most of them in Qinghai are Hui, a Muslim ethnic group—were surprisingly candid in expressing doubt about how much the fungus by itself could really help to boost libido.

Even more troublesome to those in the business is President Xi Jinping’s campaign against corruption, which has been unusually fierce and protracted. This has curbed the once-common practice of bribing officials with expensive gifts, including caterpillar fungus. A glass jar containing 80-odd plump specimens neatly tied together still sells for 63,380 yuan—nearly $10,000—at a medicine shop in Beijing. But prices have fallen by as much as 20% in the past year, even as supply has remained level.

More worrying for the authorities, yartsa gunbu has fuelled unrest on a plateau already boiling with discontent over Chinese rule. Gyegu’s annual horse festival offers a clue to this. The three-day summer fair involves displays of horsemanship, singing and dancing—including, one year, by children dressed as caterpillar fungi (pictured, in 2007). It attracts thousands of Tibetans, many of whom camp on the surrounding grassland by a meandering river. The festival resumed in 2014 for the first time since the earthquake. At this year’s event your correspondent saw police deployed in large numbers, some equipped with fire-extinguishers. Two fire engines were parked by the main arena.

Everybody do the caterpillar fungus Such precautions are common these days in areas where Tibetans gather, lest anyone attempt to set fire to themselves: a desperate form of protest against Chinese rule that has claimed at least 123 Tibetan lives since 2009. In the now lavishly rebuilt city of Gyegu, a 27-year-old Tibetan monk apparently tried to kill himself this way in the main square in early July, just a few days before the horse festival. Police extinguished the flames and hustled him away. Tibetans in exile say he died a few days later in hospital.

Fungus, a bogey man

Yartsu gunbu has, indirectly, heightened these tensions. It has contributed to a surge of visitors to the plateau in recent years, most of them members of China’s ethnic-Han majority. Uneasiness over this influx, and the fact that businesses catering to tourists are also dominated by Hans, were among the causes of an explosion of unrest across the plateau in March 2008, including anti-Han rioting in Lhasa that left several people dead.

Caterpillar fungus has also been a direct cause of violence among Tibetans, and between Tibetans and caterpillar-poaching Hans. In parts of the plateau, the annual rush for fungus is Klondike-like. In a report by the Communist Party committee of Nangqian county in Yushu, a village official says: “Caterpillar fungus has turned people bad. It has made them think only of money and caused them to lose their sense of family, friendship and humanity.” Complaints abound about Tibetans frittering away their caterpillar money on gambling and booze (there are few opportunities for Tibetans to find decent work in cities, where jobs usually go to Hans or Huis).

Mr Mayong, the guide, insists that in his experience, fellow villagers are courteous to each other in their collective scramble. That is not how it works between rival villages, however, or when caterpillar poachers invade a village’s territory. In 2013 two people were killed in another part of Qinghai when villagers shot at rivals. The Dalai Lama, Tibet’s exiled spiritual leader, said fungus-fuelled fighting had caused “disgrace to the Tibetan people” and a “crisis” on the plateau.

During this year’s harvest season, security forces in some parts of the plateau warned that the task of “stability preservation” was “grim”. In Shangri-La, a Tibetan town in Yunnan province (so named in 2002 in order to attract more tourists), police told residents to give up any hidden guns as the season approached. In one county of the TAR, villagers were told they would be banned from harvesting caterpillar fungus for a year if they used any outsiders to help—an attempt, partly, to curb the kind of violence that has sometimes broken out between Tibetans and Han fungus-gatherers.

The environmental fallout has been considerable, too. For a time before the earthquake in Yushu, the horse festival (which includes yak races—a perilous sport for the riders) offered a clue to one aspect of this. It was in the elaborate traditional costumes that rural Tibetans like to wear on special occasions. Enriched by caterpillar fungus, some took to augmenting their garb with the skins of leopards and tigers smuggled from India through Nepal.

Local officials in Tibet were of little help in stopping this. According to Emily Yeh of the University of Colorado at Boulder, they wanted to encourage festivals as way of attracting tourists from the rest of China; exotically dressed Tibetans were seen as crowd-pullers. Counties in some parts of the Tibetan plateau “competed to show off their wealth and development status through the hyperbolic display of jewellery and pelts on the bodies of their Tibetan participants [at festivals], often so much that participants had trouble walking under their weight”, she said in a paper published in 2013. Popular singers began sporting pelt trims on their music DVDs. This surprising—and tragic—side-effect of demand for a purported aphrodisiac came to an equally unexpected end. In 2006, at a prayer ceremony in India attended by thousands of Tibetan pilgrims, the Dalai Lama called on Tibetans to cease wearing animal furs. The impact was immediate. From across Tibet reports emerged of Tibetans piling up their furs and burning them: given the garments’ huge value, an extraordinary display of devotion to the Dalai Lama. Anxious Chinese officials tried to ban such bonfires and arrested the organisers. In some places they even ordered Tibetans to wear their furs at festivals.

But the Dalai Lama’s injunction held firm. Despite a stepped-up campaign by the government to vilify the exiled Tibetan leader since the unrest in 2008, Tibetans appear largely to have heeded him. India’s tiger population fell from 3,642 in 2002 to a low of 1,411 in 2006. Since then it has climbed back up to 2,226. Your correspondent did not spot any furs looking like those of rare animals at this year’s festival in Yushu. In the privacy of Tibetans’ homes, the Dalai Lama’s popularity is evident. One yak-herder, in her tent on the 4,500-metre pastures of Lanweilaha Mountain, gets out her box of recently harvested caterpillar fungi. She keeps it under a portrait of the Dalai Lama (banned in some parts of the plateau) which has a strip of yellow cloth draped over it as a symbol of respect.

Another worrying environmental impact, which has yet to be stopped, is on the grassland itself. Mr Mayong says villagersreplace any turf they dig up with their small hand-hoes (as local regulations require them to). But some Tibetan villages employ outsiders who are often less fastidious. Estimates of the damage this causes vary wildly, from a few square kilometres of grassland damaged every year to more than 65 square kilometres in Qinghai province alone. This compounds problems caused by global warming, mining, the spread of rodents and, officials insist, overgrazing, though herders and environmentalists accuse the government of exaggerating to justify settling nomads in places where officials can better control them. Yushu is the source of three of Asia’s greatest rivers: the Yellow river, the Yangzi and the Mekong; the grasslands play a vital role by regulating the flow of water into them.

Yartsa gunbu is so highly prized as an aphrodisiac that it is worth more than its weight in gold

In the rest of China, such concerns appear to weigh little on the minds of yartsa gunbu’s wealthy buyers. State-controlled media do not like to dwell on anything that portrays life on the Tibetan plateau in a negative light. Environmental activism—particularly related to Tibet and other areas inhabited by restless minorities—is kept on a very short leash. The authorities worry that eco-campaigning might provide cover for separatists.

Neither is there much questioning of whether yartsa gunbu is all it is cracked up to be. The Communist Party is a staunch defender of traditional Chinese medicine (often called TCM), despite a lack of scientific evidence for some of its claims. At its margins, TCM blends into mysticism—a belief in a force, known as qi, that regulates the body in ways unrecognised by modern science. But the party sees itself as a defender of Chinese nationalism; TCM is seen by many nationalists as a vital ingredient of Chineseness.

It is odd, however, that the fungus has become quite the TCM star that it is today. There is no known mention of it in Chinese medicinal works before the 17th century—by the standards of TCM, that is relatively recent. By the 19th century, however, the fungus had become linked with status. The Colonies, a British newspaper, told its readers in 1876: “[I]t is reputed to possess strengthening and renovating qualities; but on account of its scarcity it is only used in the palace of the Emperor or by the highest mandarins.”

Early foreign observers were no less astonished by yartsa gunbu’scost. “A Handbook of the Larger British Fungi”, published by the British Museum in 1923, said in a footnote: “Black, old and rotten specimens are said to be worth four times their weight in silver.” The Communist takeover in 1949, however, was a huge blow to business. Wealthy Chinese, the main consumers, fled abroad; under a Western-led trade embargo, trade slumped.

The fungus revival began in 1993, at the World Athletics Championships in Stuttgart, Germany. A team of little-known Chinese runners took the gold medals in the women’s 1,500-metre, 3,000-metre and 10,000-metre races. Then, a month later, the same team won these races at China’s national games in Beijing, setting world records in all categories. One of them, Wang Junxia, shaved an astonishing 42 seconds off the previous best for 10,000 metres. Only a year earlier, she had been ranked a mere 56th in the world.

The “secret weapon” of the team’s success, said their coach, Ma Junren, was a combination of intense high-altitude training on the Tibetan plateau, turtle blood, ginseng and a tonic made of caterpillar fungus. Yartsa gunbu’s fans prefer to leave the story at that, downplaying evidence that emerged several years later that other athletes trained by Mr Ma had been taking banned substances, including testosterone (he denies giving them any). Mr Ma is now reported to be engaged in a new business, breeding Tibetan mastiffs.

Mr Ma’s plug for the fungus came at an opportune moment. Grassroots health care in the countryside had disintegrated in the 1980s with the break-up of the “people’s communes” that Mao Zedong had established. Now in the cities many state-owned enterprises were teetering on the brink of collapse, and with them the basic medical services they had once provided. Citizens were being forced to pay cash for treatment; serious diseases could easily plunge families into dire poverty. Demand for TCM remedies, with their reputed prophylactic properties, was beginning to soar. Caterpillar fungus appealed to the better off, but TCM offered many medicines that were cheaper than imported Western ones. TCM-related mystical practices such as qigong—involving breathing exercises and meditation—could supposedly ward off major illness for no cost.

That there was no clear evidence of yartsa gunbu’s properties made little difference. Between 1998 and the global financial crisis in 2008, calculates Mr Winkler, the price rose more than 17-fold to nearly 70,000 yuan per kilogram. In 2003 an outbreak of SARS, an often deadly respiratory disease, gave the fungus a further publicity boost: TCM doctors claimed it had helped some patients to recover more rapidly than they would have with Western medicine alone. The People’s Daily, the Communist Party’s main mouthpiece, said that in the fight against SARS, TCM “once regarded as outdated or effective only against chronic diseases” had proven to be “one of the most powerful weapons”.

There are some sceptics, too. Last year an anti-TCM campaigner in Beijing offered a 50,000-yuan reward to any TCM doctor who could achieve a success rate of at least 80% in diagnosing pregnancy merely by checking a woman’s pulse (a critical diagnostic tool in TCM). His challenge aroused considerable media interest in China. There were a couple of well-publicised failed attempts, but nobody won the prize. Advocates, however, claimed a victory in October when a TCM doctor, Tu Youyou, was given a Nobel prize for the discovery of artemisinin, an anti-malaria drug. The prime minister, Li Keqiang, said the award demonstrated the “great contribution of traditional Chinese medicine to the cause of human health”.

Mercifully for the government’s budget, caterpillar fungus is not one of the medicines covered by state-funded health insurance. Your correspondent had only his own wallet when he went to the caterpillar-fungus department of a TCM clinic attached to an emporium in central Beijing run by one of China’s biggest retailers of TCM products, Tongrentang, a company founded in 1669.

Dr Li Zhenhua took the pulse of both wrists and looked in his patient’s mouth. He asked a few questions: “Do you feel thirsty?”, “How is your sex life?”. Then came a more animated discussion about what to prescribe (the only symptom proffered was poor sleep, though Dr Li said his examination revealed a lack of vigour in the kidneys). What quality of caterpillar fungus would the patient like? Would he like ginseng, too? The prescription thus negotiated involved three months of daily medication. At a cashier’s desk the bill was totted up. It came to more than $4,600—possibly the most expensive remedy for jet lag ever prescribed. Your correspondent muttered his excuses and left.