The Rodent Guy    

To breed or not to breed?
Tough call for some people. Especially when you have seen how darn cute newborn baby chinchillas are and how sweet the parents can be with their family.   See the difference in chin sex organs.  MALE (above)  FEMALE (lower pic)

Like with most rodents, the spacing is much greater in the male and very little space in the female.

As I have already written, keeping chins is not to be entered into lightly, and this goes triple for breeding.
The first most important consideration is the quality of the stock you have to work with and what you will do with the resulting offspring.
Pet store chinchillas should never be bred. Same goes for the misc. rescue chins, or chinchillas that come from a friend or a relative that just happened to have some babies by surprise.
Now these same arguments can be used about almost any pet, from mice to dogs, hamsters to horses.  While I don’t condone the illicit breeding of any pet, the bigger critter or the longer-lived it is, the worse the problem becomes over time.  Lets stick with chinchillas here.
  Only pedigreed chinchillas should be used for breeding, which are chins of known origins that can be traced for at least 4 generations. Breeding stock should also be close to show stock, regardless of whether you plan to show or not.  Chins do not have a central registry like the AKC is for dogs.  The breeders and ranchers are more on the honor system like rabbits and the ARBA.
Regardless, these files mean a great deal to those of us that keep our records and wish to know what we have, what we produce and are setting goals in our breeding programs.  Those that simply want to mate two animals by putting a male and female together are not breeders, they are "multipliers"
Some strong reasons to consider breeding with the right pedigreed stock are:
 Even when breeding the best to the best, you will have what is loosely called the One Third Rule...  Meaning, 1/3 of the offspring will be of lesser quality then the parents, 1/3 will be about the same, and 1/3 will be slightly better.  If you are using poor quality animals to begin with then the stock produced is going to be caught in a downward spiral.
  Breeding only pedigreed stock refines many qualities of hair and coat as well as body form and function that define the species.
  Properly bred and accurately documented stock helps trace and often eliminate genetic defects like heart disease, fur biting and teeth malocclusions as well as other teeth related ailments, not to mention other health concerns.
  Tracing lineage keeps track of color genetics to ensure proper use of dominant, recessive and semi lethal color genes in the species.  Also, this type of tracing allows for the discovery of new genes and color variations.  Sports/mutations can occur at any time in any species or gene pool.  Proper breeding includes goals and standards set by the single breeder and the local and international clubs (Empress Chinchilla Breeders Co-op and Mutation Chinchilla Breeders Association)

Even if you are thinking of breeding with no plans of showing or competing for standards for either club, breeding sub quality animal is not acceptable.  Better animals cost no more to house and feed, they are equally good as pets and can often be purchased from show breeders and ranchers for about the same price as you would pay at a retail pet store.
Many ranchers and hobby breeders sell their less desirable animals to the pet market with out the benefit of pedigree because these chins do not meet breeding/show standards. It is not that, all or any of these lesser quality animals carry any genetic defects, but the fact the pedigree is lost, these animals should only be used as pets.
  If it had not been for old time ranchers keep track of genetics and pedigrees very early on, we would not have found out about some of the varieties of color we now enjoy in chinchillas.
  Some of these same contributors helped narrow the chance of the current generations carrying more genetic problems.  If you think about breeding you should not try to undo this progress, regardless of on what scale you will be breeding.  Pedigree alone does not make a chinchilla eligible for breeding.  The entire breeding stock needs to be evaluated on an on going bases.  Some of the old ranchers, and maybe many still today, do not keep strict one on one pedigrees for each and every animal, but they know their stock and they know the families, and they have to be very hard on the outcome of the herd to maintain their reputation.

There are many large breeders and ranchers that have less to do with pelting and more to do with showing and selling herd improvement stock to others and to pet show hobbyests.

I hope this helps you have a better idea of what you want to do in the area of breeding.