There is an article on rhino horn trade circulating that is written by Albert Kuller, an economist.


His argument is that if you move from a ban to free trade, more people will want to buy horn when it becomes legal to do so and with greater demand the price will rise and with a higher price poaching will increase.  Therefore trade is a bad thing.

But, he has not considered the option of a “Smart Trade” where a monopoly Central Selling Organization (CSO) could sell to a cartel such as the Traditional Chinese Medicine government hospitals.  In this more sensible arrangement the CSO can determine the price at which horn is sold so as to limit demand to the level of sustainable supplies.

The Chinese government being invested in the legal trade will close down (most of) the illegal trade in poached horn.  Because of the risk of being caught trading in poached horn and being punished by the Chinese police and also the risk of buying fake horn or poisoned horn in the illegal market, the price of poached horn will be much lower than the legal price.

Poachers “will decrease their output” because the price will be lower.  Speculators in illegal horn, who are currently significant, will turn sellers because the price of illegal horn will fall.  There will be a much smaller overall demand for illegal horn than now.  While “Free Trade” may increase poaching, ‘Smart Trade” will reduce poaching and reduce it substantially.

The assumption here is that China remains the biggest market for horn (90%+) and that the main reason for consumption is for medicinal use, which has been the case for centuries.   Retail cartels, buying from the CSO, can also be established in other consumer countries.

At current prices and current levels of demand South Africa can satisfy the market, sustainably, without having to kill one rhino.  The way to do it is with “Smart Trade” not “Free Trade”.

Rhino 1