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Caterpillars are seen as mostly harmless insects. Where a handful may be ok, thousands are a problem.
In Colorado, tent caterpillars are being seen in greater numbers than in past years, and their eating habits are causing mass defoliation of trees. Healthy trees are able to recover, but for some trees, the loss of leaves causes permanent damage.
Thankfully, the caterpillars should be moving into their next stage of life soon. They will cocoon themselves and emerge in a few weeks as moths.