The Market for Rhino Horn
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Rhino horn is actually not horn but tightly matted hair. Under the CITES agreement trade in Rhino horn has been classified as illegal. Although a considerable amount of hunting of rhinos for their horn took place in colonial times it is really only since the independence of countries with populations of rhinos that the decline in the numbers of rhinos by illegal hunting or poaching worsened.
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The price of rhino horn in the market place is determined by the market supply and market demand. The demand for rhino horns exists for a number of reasons. In the Far East, and East Asia rhino horn is prescribed as an ingredient in traditional remedies to reduce fever and as aphrodisiacs. In Yemen and Oman rhino horn is used to make the handles of curved daggers which are status symbols to men. With the increase in affluence in the Yemen and Oman following the rise in the price of oil the demand for these daggers increased.
The supply of rhino horn has been influenced by a number of factors. Firstly the population of rhinos is very unstable. The population of rhinos has decreased as increased poaching has seen the stock of living rhinos diminish. Rhinos have a low fertility rate. Typically a mother rhino has only one or very occasionally two young. They do not reach maturity for at least three years. So the population growth rate is low.
Many African countries have growing populations of people living in worsening poverty. The pressure on people to resort to illegal hunting in order to survive is great. The resources available to prevent and control illegal hunting are very limited. Indeed the wages of people employed to protect the rhinos in many countries were so low that they often resorted to poaching themselves to supplement their income. They were prepared to take the risks associated with poaching. The risks of being caught or killed were relatively low compared with the sum of money that could be made from selling a rhino horn. Many of the poachers would base themselves in neighbouring counties and make cross border sorties to get the horn often using more sophisticated equipment that the anti-poaching units had at their disposal.
As early as 1976 Zambian horn was being sold wholesale in eastern Asia for US$600 to US$750 per kilo and the price has increased over time. The poachers themselves attempt to manipulate the market price by controlling the supply. There have been cases where poachers gunned down rhinos from helicopters having no intention of collecting the horn and risking capture or being killed. This strategy reduces the supply of future horn and raises the value of the existing stocks when illegally sold.
As the number of rhinos decreases due to poaching the market for the horns becomes more lucrative and poachers are prepared to take larger and large risks to obtain the increasingly valuable horn.
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Related Glossary Items:
Supply
Demand
Related Issues:
Fighting Poaching in North Kafue
NGOs and Wildlife Management
Related Theories:
Market Failure
Malthus and the Law of Diminishing Returns
