Minister Molewa sets criteria on rhino horn auction

South African rhino breeder John Hume has a herd of nearly 1500 rhinos at his private ranch in North West province

The Minister of Environmental Affairs‚ Edna Molewa‚ has complied with a court order to issue a permit for the selling of rhino horn‚ but has imposed conditions on the auction by breeder John Hume.

Hume went to court over the weekend to secure an order permitting him to proceed with the auction of 264 of his rhino horns.

The auction‚ which is the first legal horn auction in decades‚ had been advertised in Chinese and Vietnamese via his website.

The matter was heard through an urgent application in the Pretoria High Court on Sunday afternoon.

Hume had taken the Department of Environmental Affairs to court to force it to release a permit he was granted for the online auction‚ which is scheduled to kick off on Monday afternoon.

After receiving an email from the department two weeks ago informing him his permit was granted‚ the department made a u-turn with Minister Edna Molewa arguing that the official who had informed Hume that he had been awarded the permit had no authority to do so.

In papers filed in court‚ Molewa argued that only she had the powers to grant such a permit.

Delivering his judgment‚ Judge Neil Tuchten said it was not for the high court to decide on whether or not the dealing of rhino horn was a good or bad idea.

He said there was no “valid defence given by the Minister“‚ adding that she had received Hume’s application in May.

The application should have taken 20 working days to be completed.

He ordered her department to grant Hume his permit within 12 hours and pay his legal costs.

The domestic sale of rhino horn is legal following a Constitutional Court order in April 2017 upholding a 2015 High Court decision uplifting the 2009 moratorium on the domestic trade in rhino horn retrospectively‚ subject to permits being issued in terms of the National Environmental Management: Biodiversity Act‚ its regulations and applicable provincial legislation.

On Monday‚ the department said in a statement:

“It should be noted that the permit to be handed over to Mr Hume was issued with a number of conditions‚ including the following:

– The permit holder can only sell rhino horn to a person who has a permit issued in terms of the National Environmental Management: Biodiversity Act‚ 2004 authorising him/her to buy rhino horn from Mr Hume (i.e. a buyer’s permit)

– The permit does not authorise international trade in rhino horn.

– The department must be granted access to the online auction to do the necessary compliance monitoring.”

“The department wishes to reiterate that the commercial international trade remains prohibited by the Convention on the International Trade in Endangered Species of Wild Fauna and Flora (CITES). South Africa is party to CITES.”

I wonder if the conditions lead to an artificially low price because they can't be sold (legally) where the actual market is?
Or.....a low price from speculators trying to buy inventory at a low/lower price to hold in anticipation for a potential future market (or of course hedge the price to the black market)?
Is Hume trying to raise a bit of cash flow at any price now to recoup money?
Any insights or thought?

Any market price will apply only to the legal market if appropriate safeguards are in place to prevent illegal horns being siphoned into the system.

So really it won't flood the market or influence black market prices, only raise some money for Hume to meet his costs. In theory.