A Penny for your thoughts: Copper theft and the rise in copper pricing.

Allied's Wire NewsReelIn August alone, copper theft delayed getting water cleared from flooded freeways in Detroit because thieves stole copper piping from pumping stations used to clear water from the freeways.  Two men were taken into custody in a western suburb of Omaha, Nebraska after attempting to steal copper from a cell phone tower.  A West Virginia man pleaded guilty to two counts of grand larceny after stealing $2,000 worth of copper from a local power plant.

Unfortunately, copper thefts are nothing new according to the National Insurance Crime Bureau which reports on insurance claims regarding metal thefts each year.  Their most recent report takes a look at metal insurance claims from January 1, 2011 through December 31, 2013 and found that during this time 41,138 insurance claims for the theft of copper, bronze, brass, or aluminum were handled and of that number 39, 976 of those claims were for copper alone.

“Copper theft is pretty common around the nation. Why? It’s no more complex than understanding that there are plenty of people who are willing to steal something that can be converted into quick cash. Our reports only capture insurance claims for these kinds of losses and we’re not even scratching the surface of all of the activity that goes on. Most of these kinds of thefts do not trigger an insurance claim so the numbers in our reports are not nearly representative of the actual numbers of incidents,” said Frank Scafidi, Director of Public Affairs for the NCIB.

copper wire

Copper theft affects the price of copper. The thefts have a direct relationship to the price increases reported by The Camden copper index and the Comex index.

Cause and Effect:Thefts affect price

When you compare the metal theft claims per month and the monthly average copper prices, the number of claims filed has a significant relationship with the price of copper. Since January of 2009 the price of copper has risen significantly from $1.48 lb to 4.49 lb in 2011 , according to statistics from the NCIB and the Comex index.  By the time the price of copper hit $4.49 lb, theft claims had jumped from 239 to 1,038 per month.  By August 2011, when copper was $4.76 they hit 1,397.

“The kinds of people involved in these thefts are probably not dialed into real time commodity trading and timing their thefts to exploit market conditions. On the other hand, if some characters are doing so, it suggests a much more organized operation because those folks would need to harvest a large amount of the material to make it worth their effort,” Scafidi said.

“The garden variety knucklehead who steals a run of copper wiring from an unoccupied home or a vacant building is just taking advantage of the opportunity and hoping to turn it into enough cash to make it through the next few days,” Scafidi added.

“But in any case, this behavior has damaging results and replacing materials is costing owners and public utilities tons of money.”

No one is immune

This epidemic affects a variety of different industries such as the agriculture industry and utility industries as well as individuals.  However, one industry that can get hit pretty hard is agriculture. The copper that is inside span cables used in the agricultural industry isn’t really worth a whole lot of money but when thieves attack and go for this type of metal theft, it can cost tons of money in repairs including the damage done to their crops and a jump in insurance costs.

The states leading in metal theft claims are Ohio with 4,144 claims, Texas with 2,827, California with 2,489, Pennsylvania with 2,345, and Georgia with 2,067.

What can we do?

The rise in scrap metal thefts has driven necessary legislative activity.  In 2012, Ohio, the leader in metal theft claims passed stricter legislation which now requires scrap metal dealers to obtain identification from scrap metal sellers and prohibits cash payments to them.  More recently this year, Michigan Governor Rick Snyder and Colorado Governor John Hickenlooper signed a similar bill into law hoping to quell the tide of metal thefts which cause losses to businesses and government entities and cause customers and taxpayers more money through higher costs for goods and services and/or reduction in services.  Also in place in seventeen states are “no-burn” laws named after the fact that copper thieves tend to burn stolen cable before selling it to scrap businesses and this law will prevent scrap dealers from accepting burned cable.

For more information on the movement to end copper theft visit www.endcoppertheft.com.  This “End Copper Theft” campaign was initiated by Southwire Company and supported by a host of organizations all touched by this issue to raise awareness among growers, irrigation dealers, metal recyclers, law enforcement and legislators.

Although copper hasn’t been above $4/lb since early 2013, Allied Wire and Cable is always prepared to help in case the prices start rising again.  Check out our ways to help you save money on copper that we published in 2008 when copper prices were starting to rise. Click here for more information.

Allied Wire and Cable is continuously committed to providing the best customer experience possible. We understand that part of great customer service is providing the lowest prices available to our customers. AWC is dedicated to helping you save money. Look to AWC for continued copper pricing updates.

About awcwire
Allied Wire & Cable is a value-added manufacturer and distributor of electrical wire and cable, tubing, and more. We are a family owned and operated company, serving a wide range of industries, including the military, automotive, aerospace, and telecommunications markets. Allied is headquartered in Collegeville, PA. Additional locations can be found across the US, in Merrimack, NH, Tampa, FL, Pewaukee, WI, and Las Vegas, NV. For more information on Allied, visit our main website at www.awcwire.com.

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