By Brendan Moyle 13/01/2017

The recent decision by China to close its domestic ivory trade industry has been welcomed by many conservationists.

Nonetheless, I remain skeptical it will be a significant move to curb poaching.  This is generally accepted to have peaked in around 2011, albeit it is uncertain whether wild populations can sustain the illegal off-take.  The overall picture is still murky.  While Southern Tanzania has lost many elephants, populations have grown in the north.

I co-authored a report led by Dan Stiles in 2014 that looked at, and modeled the demand drivers for ivory in China.  This report emerged later at the CITES CoP meeting in South Africa, where the South African delegation used it.

Tip of the iceberg

In very rough terms, there has been about 200 tons of raw ivory smuggled into (mostly) China annually since 2010-11. The legal carving market (37 factories and 145 retail stores in early 2014) uses 3-4 tons a year from legal sources.  This is mostly the tusks from the 2008 CITES approved sale[1].  One should also point out that a factory here is usually no more than a dozen ivory carvers in a single workshop space.  It’s not a large scale industrial process.  Our estimates of the illegal carving output is 6-8 tons a year.  This number has a lot of uncertainties so it could be higher.  Its hard getting a good picture for what is sold through the internet in Peer-To-Peer transactions, especially when a lot of this could be fake.

The point however, is in a market that uses say 200 tons of ivory a year, we’re shutting down the outlet for 3-4 tons of it.  There was only 130 stores at the start of 2016 left.  You can’t legally buy ivory from any other stores.  The legal stores are also heavily clustered. Half of them are in Beijing, Shanghai and Guangdong (Guangzhou).  For most cities in China, the closure of this retail sector is not going to make any difference- because they don’t have any stores to close.


Source: Shutterstock 249130687
Source: Shutterstock 249130687

The evidence is also that most of the raw ivory is being stockpiled.  The recent United Nations Office on Drugs and Crime (UNODC) report on wildlife crime also came to that conclusion.  The smoking gun so to speak, is that these big shipments of raw ivory are sensitive to financial variables [2].  There appears that after the GFC in 2008, many investors were looking for assets that would keep their value or grow.  Financial markets were tanking.  Raw ivory makes for a good investment in this sense.  It’s easy to store, it doesn’t rot, and it has gone up in value since 2009.  It’s taken a while, but many conservation organisations have come around to the idea that the problem isn’t the demand for carvings, it’s this speculative demand.

This speculative demand isn’t being addressed by the closure of the domestic market for carvings.  It is by far the largest and most potent source of demand for illegal ivory.  Now, while I’ve heard it argued that this ivory is destined for the carving industry in the future, this seems to overlook raw ivory has value in its own right.  It’s like gold bars. Central Banks and other institutions hold gold as an investment good.  They expect to trade it to other investors.  Central Banks aren’t holding gold in the hope they can sell it to manufacturing-jewelers later.  It’s not the expected demand for gold watches that persuade Central Banks to hold gold.  Similarly, it is likely that these ivory-investors aren’t hoping to sell their ivory to a legal factory to turn into some chopsticks.  Like gold, they’ll be trading ivory with other investors.

Illegal retail still the big game

Even if the ivory is going into the carving market, this move takes out 130 stores. In a country the size of China with 1.3bn people.  We know there are many more illegal retail stores.  We know there are actually illegal carving factories (typically much smaller than the legal).  We’ve known this since 2005 when CITES sent a party to assess the situation.  Anybody who has investigated these markets (including myself) knows there are more illegal sellers.  The bad guys aren’t likely to be thwarted by having the tiny legal retail sector gone.  There’s a lot of illegal retail sellers they can still shift product through.

The last argument is that closing the legal market makes enforcement easier.  Everything can be assumed to be illegal.  This seems naive in light of the organisation of the legal ivory market.  Anything sold outside the 130 approved stores is already illegal.  These illegal sellers though tend to be small and mobile. They popup in a market, then disappear later.  They carry small levels of stock so arrests have little impact on flows.  They are in theory, just as easy to locate now, as they will be after the domestic market is closed.  Yet they still persist.

And this then turns on the structure of law enforcement.  It’s been well known, and often commented on, that law enforcement agencies tend to put little effort into wildlife crimes.  This is disparaged as a kind of “bunny-hugger” concern.  These guys are after serious crimes. Crimes that harm people and property.  One of the reasons illegal sellers of ivory persist, and successfully, is that it doesn’t rate as a serious concern for the police out there in the markets.  Also in China (generally speaking), all wildlife crime is investigated by the Forest Police.



This is a separate and independent police force that operates  under the authority of the State Forest Administration.  If another agency detects a wildlife crime, this is then handed over to the Forest Police to investigate (and possibly prosecute).  This puts a lot of trust that these agencies are going to devote resources to detecting crimes that are outside their interest and jurisdiction.  I’m skeptical that enforcement will get any easier, or there will be motivation to increase that enforcement at the ‘street level’. If it relaxes under the assumption the ban will stunt ivory trading, it may well make the situation worse.


[1] Some factories still had small stocks of ivory from before the 1990 ban.  There was also for a time a sale of pre-ban tusks from owners in Europe to China until this was the EC banned it.

[2] The UNODC report is promoted here. One of the key pieces of evidence they used was my paper “The raw and the carved: Shipping costs and ivory smuggling”, Ecological Economics 2014, 107: 259-265 which demonstrated the interest-rate link to big shipments of ivory.

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