Chapter 1: China
Tons of demand for “commercially extinct” species
Credit: Choy Tsai / The Reporter
Hi there!
Today, we’re starting our serialised newsletter on the illicit trade in pangolins in China, where some of our reporters went undercover. One of them is Xu Jiaming. You’ll find a Q&A with him here just before we get to the chapter.
If you have questions for him or would like to get in touch, just respond to this email. You find our entire project here:
Q&A with Xu Jiaming
Jiaming is a Guangzhou-based journalist who has worked for Southern Metropolis Weekly and Southern Weekly, two leading national publications. He covered politics, social issues and legal matters, before spending the last few months investigating the pangolin trade in Vietnam and China.
Why did you join this project?
It’s rare for a Chinese reporter to work with reporters and editors from other countries and to collaborate deeply on a joint investigation. This complex issue like the pangolin trade requires this kind of collaboration, and it needs a professional team that shares the same values and journalistic ethics.
What was the hardest part of this project?
The lack of information transparency in China. The legal pangolin scale stockpile, for example, effectively provides a loophole in the protection of the species. Where does its supply come from? What happens to it?
The administrators have not been willing to answer these questions. The local media and NGOs have been trying to find out more about this, but they’ve never been successful.
But we did find useful information online in the form of an official online collection of court decisions around the country. We spent a lot of time pouring over the court documents and found a lot more information than was previously not known. (We will share more of our findings later.) A local NGO and volunteers also kindly shared medical data and gave us access to their efforts to save the captured animals.
What surprised you when you reported this story?
I was very touched when I saw three pangolins being held in a public zoo. For the first time, I learned that pangolins have emotions and feelings just like us humans. Their body shakes when they feel anxious, and they cry. The connection between mother and child is strong. Even when a child stays with an unrelated adult pangolin for a long time (this happens when smugglers put many together), they can develop similar levels of connection. The adult female carries the baby pangolin on her tail. That’s very touching.
Pangolins give birth not more than once a year, so their ability to reproduce is limited. They have no real predators in nature, except for us humans. They could happily live in peace.
Regarding the smuggling trade in China, I think one lesson should be the general lack of awareness of how precarious the situation is for the species and the broader importance of biodiversity. When I talked to traders in Guangxi and Guangdong, they told me that they were trying to make a living. They didn’t realize the importance of pangolins, and that pangolins could even be of use to humans. For example, pangolins can eat termites, potentially allowing farmers to save on pesticide.
Some hot spots along the smuggling route are economically dependent on illegal trade, including the trade of pangolins. It is hard to believe that some local officials and law enforcement are not taking a cut.
Chapter 1: China
Tons of demand for “commercially extinct” species
Outside the gates of a warehouse in southern China, a middle-aged man surnamed Zhang at first showed no interest in talking to us or answering questions about his business dealings in Traditional Chinese Medicine (TCM).
His mood changed when we mentioned pangolins. “Do you have supply?” he said. “Come to our office, let’s talk about it more.”
Zhang works in the supply department of a TCM producer in Shantou, Guangdong Province. “So far this year, we’ve used several tons of pangolin scales,” Zhang said. “We need at least a few hundred kilograms a month.”
“We ordered a ton of scales last month, but it hasn’t arrived yet,” he said, adding that they would also sell unprocessed scales to other pharmaceutical companies.
Our reporters reviewed more than 400 court decisions in criminal cases in China related to the illegal trade in pangolins from 2005 to 2019. In only a few of the court cases we studied were prosecutors able or willing to retrace the smuggling routes to their origins, like Indonesia and Nigeria.
The numbers of pangolin seizures are rising, not only in China, the primary market, but also in transit hubs such as Vietnam, Singapore and Hong Kong, according to EIA figures. Even in those places, the origin of the goods remains unknown for the vast majority of cases.
Breeding and keeping pangolins has proved difficult. China has an intransparent system that allows for the continued consumption of pangolin stockpiles for TCM. Due to the high demand and limited regulatory oversight, many suppliers rely on cheaper, illegal imports.
This was why we visited Zhang, undercover, at his factory in southern China. We wanted to know where his scales came from.
Zhang insisted that his company was willing to pay a surcharge to source only legal scales, even though they could cost up to twice as much. “Price is not a problem,” he said.
His company, among others, makes TCM concoctions out of raw pangolin scales in industrial quantities. We later reached out to the company, asking them about the origin of their scales. They declined to comment.
But his statements left us curious. If a medium-sized company like his needs tons of scales, where would larger pharmaceutical companies source their pangolin scales? Where do these millions of pangolins come from if there are almost none left in China?
China’s pangolin population has dropped over 90% from the 1960s to 2004 due to massive poaching for its meat as a delicacy and its scales for medicinal use. The Chinese pangolin has been “commercially extinct” since 1995, researchers say.
The profit margins we found are astounding. Scales bought for as little as $5 per kilogram in Nigeria can be resold for up to $1,000 in China, according to traders we interviewed in China. If mixed with legally acquired scales, their price can be as high as $1,800 per kilogram.
Prices of pangolin scales and meat in different countries, sourced from wildlife conservation organisations, government officials, and interviews with poachers and traders, some of which were made undercover.
Who would want pangolin scales? According to some TCM practitioners, pangolin scales can cure a host of ailments, including inflammation and poor lactation in new mothers, and even impotence and cancer.
Dr Lao Lixing, the former director of the School of Chinese Medicine at The University of Hong Kong, said that there is no scientific research that supports the claim that pangolin scales have healing properties.
He said that TCM practitioners in Hong Kong and mainland China have largely stopped prescribing medications with pangolin scales, but pharmaceutical companies have continued to produce drugs with the scales. “It’s a matter of market and profits," he said. "To further the ban on pangolin use in Chinese medicine, we need more public education and concerted efforts by the TCM sector.”
“TCM professionals need to speak up to defend the good name of the Chinese medicine,” said Dr Lao, who speaks regularly at international conferences to advocate replacing animal ingredients in TCM with plant-based substitutes.
Pangolin scales for sale at a pharmacy in Shantou, Guangdong Province. These scales were kept in an unmarked plastic bag hidden from the counter, sold for 6 renminbi per gram – that’s less than $1. The worker told our undercover journalist that pangolin scales are good for reducing swelling and promoting lactation.
In another pharmacy in Shantou, pangolin scales are sold for more than 7,000 renminbi, or $990, per kilogram. This pack contains 5 grams and is marked with a sticker from China’s Wildlife Special Mark Centre, signifying that it is a legally sold product.
Although its medicinal properties are unproven, mostly Chinese patients appear to be consuming literally tons of these products. The problem is that we don’t know how much.
“There continues to be a complete lack of transparency on the quantities of pangolin scale stockpiles held by the government or private entities in China,” Chris Hamley, a senior campaigner on pangolins at EIA, wrote in an e-mail. “There is also no information on the estimated quantity of pangolin scales consumed by the Chinese population over a specific time period.”
“The recent string of multi-tonne ‘mega’ shipments of pangolin scales detected by law enforcement agencies in Asia demonstrates that the supply of pangolin scales from historical stockpiles does not meet demand.”
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You’ll get the next two chapters, on Cameroon and Nigeria, next week. You can read the entire report here.