BY KIMON DE GREEF–MAY 19, 2017
JOHANNESBURG — The business proposal, though strange, seemed harmless and the profits too good to pass up. But within a few months, after being inundated with photographs from illegal slaughterhouses, Jeremy wished he had never stumbled into Africa’s newest and most peculiar commodity trade.
In one blurred frame, a man he didn’t recognize wielded a club, preparing to strike a donkey tethered beside him. A dead donkey lay a short distance away, blood seeping into the dirt. Another picture showed the man crouched in a bushy clearing, skinning a live animal.
“Please stop contacting me,” Jeremy, a Cape Town investor who asked not to be identified by his real name, replied. “I told you I’m not interested.”
A boyish South African finance graduate of East Asian heritage, Jeremy first learned of the booming trade in donkey skins in late 2015, when a visiting Chinese industrialist approached him saying he was looking to buy 5,000 hides per month.
“He was offering insane prices, like hundreds of dollars apiece,” Jeremy recalled. He immediately began looking for local partners, unaware he was entering an industry that, while not technically illegal in South Africa, is dominated by black-market suppliers.
Across the continent, the price of donkey skins has skyrocketed in the last five years, fueled by demand in China. Used mainly for transport and to haul cargo, donkeys cost as little as $8 per head before the boom. Now they can sell for more than $150 each, spawning an illicit economy worth tens of millions of dollars each year, based on conservative estimates.
From Nigeria to South Africa, syndicates have taken to raiding farms and smuggling donkey skins to Chinese middlemen, some of whom also deal in banned wildlife products like ivory. Other, less overtly criminal outfits scour the countryside for willing sellers while skirting export bans and other regulations on when and how the animals can be slaughtered. With African governments scrambling to control the trade, and commercial breeders not yet able to meet increased demand, informal supply chains are wreaking havoc on rural economies that depend on donkeys for transport, while fueling abuse of the animals themselves.
The great African donkey rush is being fueled by ejiao, a 2,500-year-old traditional Chinese remedy prepared with gelatin from the animals’ skins. Ejiao is prescribed for ailments including anemia, insomnia, and excessive menstrual bleeding, though there is little clinical evidence of its efficacy. It is also a popular ingredient in beauty products, including face creams and moisturizers. Two hundred and fifty-gram slabs of the substance, which resemble resinous chocolate bars, sell for up to $350 each; in special circumstances, the price can be as much as 10 times higher. These extravagant costs reflect systemic shortages and insatiable appetite in China, where ejiao production now consumes some 4 million skins each year.
In the last two decades, China’s donkey population — once the world’s largest — contracted from 11 million to less than 6 million, while per capita GDP increased almost tenfold, from just over $1,800 in 1995 to more than $14,000 in 2015. Rapid industrialization and urban migration greatly reduced the need for donkeys in rural areas, while rising affluence in cities boosted demand for consumer products like ejiao. The result has been a surge in skins imports from developing countries, often with scant regard for the suffering of donkeys or the lives of people who depend on them.
Traders and businessmen responded in a gold-rush style frenzy
Traders and businessmen responded in a gold-rush style frenzy,” the Donkey Sanctuary, a welfare organization based in England, wrote in a report on the trade published earlier this year.
Jeremy had never heard of ejiao but was excited by the prospect of easy money. The owner of a small renewable energy firm, he had no experience dealing with livestock or exports, but in other respects he was ideally situated to enter the sector. His parents had emigrated from Taiwan years before he was born, and he’d grown up speaking Mandarin, meaning that he could communicate easily with Chinese importers.
But Jeremy needed donkeys, and to get them he turned to Claude, a stout Malawian man who claimed that he had access to an equine abattoir and a network of willing sellers. Claude, who asked not to be identified by his real name, asked Jeremy for a loan of $3,800 to procure the first batch of skins, which he suggested selling to a Chinese exporter named Liu Gin after the buyer who initially approached Jeremy pulled out. The loan was repayable in two weeks with 30 percent interest, meaning that Jeremy stood to pocket nearly $1,200.
“It was purely a business opportunity. Who would say no to that return?” he said. So he photocopied Claude’s ID book and residential lease to avoid being conned and asked his lawyer to draw up a comprehensive loan agreement. On Aug. 4, Jeremy transferred the money to Claude from his company account.
Claude had assured Jeremy that he was sourcing donkeys legally, but in reality he was operating an illicit skins-trading syndicate. While no laws explicitly forbid exporting donkey skins from South Africa, the industry is bound by strict animal welfare and food safety regulations, which require that the animals be slaughtered in registered abattoirs. Claude was buying donkeys directly from villagers and illegally butchering them on the spot — saving time and money by operating outside the law.
The South African government has clamped down on illegal outfits like Claude’s, making dozens of arrests for theft and animal cruelty in the last 18 months. Increasingly, authorities are finding that donkey smugglers have ties to organized crime. Last September, while rescuing 70 donkeys from a farm run by a skins-smuggling group, police discovered a stash of dried abalone, a South African shellfish species exported illegally by the ton to China in exchange for methamphetamines and other drugs.
Chinese and Taiwanese syndicates, collectively known as Triad gangs, have long profited from the illegal export of rhino horn, ivory, abalone, and precious minerals from South Africa, shipping drugs and migrants entering illegally in the opposite direction. When the donkey boom hit, it appears that these networks began dealing in hides as well.
“Chinese importers began asking about donkeys in 2014,” said a former South African trade consultant who spoke on the condition of anonymity. “There were seven companies each looking to buy around 10,000 skins a year. It was a big opportunity for rural development, but there were no frameworks to support legal trade. And when you can’t go legally, you go through the mafia.”
In addition to fueling criminal activity, the sudden spike in hide prices has made donkeys prohibitively expensive for rural farmers who rely on them. In Niger, for instance, average donkey prices jumped from $34 to $145 in just five years. Last September, after traders had shipped 80,000 skins in just nine months, Niger’s government joined Senegal, Mali, and Burkina Faso in banning further exports. Without intervention, “the animals will be decimated,” an unnamed Nigerien official told the BBC.
“If the trade can be regulated and monitored, then there is a genuine opportunity to create a viable export market,” said Eric Olander, a journalist who founded the weekly China in Africa Podcast. “But at present laws are unclear and unevenly enforced, with vulnerable rural communities threatened by surging prices and poaching.”
At the periphery of the syndicate that Jeremy unwittingly bankrolled was a slender Malawian immigrant in his late 20s named Sam. “A Chinese buyer was offering good money,” he said. “These guys needed help with their supply.”
A cash-strapped church caretaker, Sam began working as a fixer for Claude’s outfit, linking his buyers with farmers from villages outside Johannesburg. One day last August, he hired a minibus taxi and drove west of Johannesburg to a tiny rural settlement near the town of Ventersdorp. There he purchased 25 donkeys, recruiting a group of locals to help process the skins. They killed the animals one by one, knifing them at the base of the skull or striking them between the eyes with a hammer. Sam earned $75 that day, a small fraction of what the haul was worth.
When Jeremy learned that he’d financed a criminal enterprise, he quit the skins business completely.
Claude’s syndicate collapsed less than six months later, in February, when police arrested Gin, the main buyer behind the operation, for falsely declaring a shipment of 300 skins at Johannesburg’s O.R. Tambo International Airport. Customs officials intercepted the shipment, which was destined for Hong Kong, after noticing a foul smell rising from wooden boxes labeled “cladding.” Four days later, police confiscated more than 1,000 skins from a farm Gin had allegedly rented outside the city.
Each of the confiscated skins would have fetched more than $500 in China, for a total of more than $650,000. It’s the kind of payday that keeps Chinese importers coming back despite the risks — and young men like Jeremy, Claude, and Sam clamoring for a share of the spoils.