Copper theft has gone down from R27.5 million in April to R23 million in May.
This was reported by the South African Chamber of Commerce & Industry (SACCI) last week. It said the continued downward move picked up by its Copper Theft Barometer is a welcome signal that public-private cooperation against copper theft is delivering tangible results.
Copper theft peaked in March at R34.7 million.
Downward spiral
The chamber introduced a Copper Theft Volume Indicator in May. “This provides a volume estimate of copper stolen that strips away the possible inflationary bias of high copper prices in a given month and provides an estimate in terms of tons of copper stolen.”
It added that in economic terms, the Volume Indicator is a real indicator were the standard Copper Theft Barometer is a nominal indicator of copper theft.
The Copper Theft Volume Indicator recorded a level of 356 tons in May, a 15.9% drop on a monthly basis, from the 424 tons posted in April.
“The international spot price of copper fell to an average of $7 413 per metric ton in June, from $7 904 in May and the $8 251 average in March. This is the third consecutive monthly decrease in the metal price and the first drop below the $7 500 psychological barrier since October 2011.”
SACCI said the June average is especially significant, given that the 12-month average from June 2011 to May 2012 registered a level of $8 309 per metric ton. This downward momentum was also reflected in the price of Brent crude oil, which fell from above $125 per barrel to $90 by the middle of June.
“These are clear indications that concerns about a slowdown in global industrial activity are pulling the price of industrial commodities like copper downwards and should continue to do so until at least the end of the year.”
Volatile statistics
In terms of available data, exports of copper waste for April decreased by 28% on a monthly basis, to $36.2 million, from $50.3 million in March. Despite the lag caused by the unwinding of long-term contracts for metal exports, the continuous decrease in the international price of copper has started to filter into lower export volumes of the metal,” said SACCI.
It added that the current trend would suggest a further reduction of copper exports towards the end of the year, although export statistics are notoriously volatile and could always surprise on the upside.
“SACCI is happy to report on the SAPS [SA Police Service] initiative 'Operation Thibela'. The stated aim of the operation is to cease the market for illegal items, especially non-ferrous metals by ensuring compliance to the Second-hand Goods Act.
“The outlook for copper theft in SA remains positive, especially given efforts by the SAPS and the welcome downward trend in overall copper theft over the past two months,” adds SACCI. “The SAPS and the private sector are becoming increasingly sophisticated in preventing copper theft due to improved communication, pooling of resources and improved training in combatting this crime.”
Government previously said copper theft cost the country approximately R100 million in 2010, excluding the indirect costs incurred due to the disruption the theft caused to the economy.
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