Yes, there\’s lots of cable theft going on. Yes, it\’s a cash in hand industry. It pretty much has to be really.
All recycling industries face exactly the same problem, which is that their economics are entirely the reverse of normal retail economics.
We all understand that if you\’ve a container load of PCs, each PC is worth less than if you\’ve got one PC sitting right in front of a customer who actually wants a PC. Wholesale stuff is cheaper than retail.
Recycling works the other way around. Good clean copper scrap might be going for £5,000 a tonne (a bit over the top but that\’s the number they\’re using) but this does not mean that 100 kg is worth £500. More like £250 perhaps. Nor 1 kg £5, perhaps £1, perhaps nothing.
As the amount of scrap you have rises, each piece of scrap becomes worth more. So you do need a fairly loose and limber system of collecting, attracting, those small amounts so as to end up with the large amounts that are worth sending off to the refiner.
This is as true of copper scrap as it is of iron scrap, ink jet cartridges and mobile phones. Volume raises prices, not lowers them.
Back to cable scrap theft:
Ministers will consider overhauling legislation dating back to the 1960s at a summit in Whitehall today as they come under pressure from a number of industries to tackle the trade in stolen copper.
Rail has been worst hit by the spate of thefts that has increased as the value of copper has risen on the world markets.
The phenomenon is also causing increasing concern to the telecommunication and electricity distribution industries.
Such is the scale of the problem that six Whitehall departments will be attending the meeting.
Representatives from the Treasury, Home Office as well as the departments of Energy, Environment and Business will join Norman Baker, the local transport minister at the Whitehall summit.
The focus will be on the 1964 Scrap Metal Dealers Act, which many industries now believe is inadequate to deal with the problem of cable thefts.
Options under consideration include licensing scrap metal dealers, banning them from dealing in cash and giving police powers to close rogue traders down.
Other curbs could include require anyone selling scrap to provide proof of identity.
The one thing you don\’t want to do is ban cash transactions.
Take, just as one example, a small garage, a mechanic who deals with three or four cars a day perhaps. He\’ll occasionally have a car radiator, maybe a starter motor, possibly even a catalytic converter, that has come off a car. We would like that to get back into the recycling system, the first two for the copper content, the last for the platinum. When we\’ve a few hundred of any of these together they might be worth from £10 to £50 each. But we need to collect them up in their ones and twos from these small mechanics.
The obvious way of doing so is to have a collection round and cough up a couple of quid for each as and when they become available. Bit of beer money just to make sure that they\’re put aside for a fortnight until the collection takes place.
And, more importantly, we\’ve seen what happens to such extant collection systems when the bureaucracy becomes involved. Used to be a company that operated just like this to collect car batteries. 50 p to the mechanic for each one. By the time the lorry loads arrived at the processing plant they were worth perhaps £5 each and they were thoroughly reprocessed (battery lead contains some antimony so they used to go to a plant at Avonmouth which made the lead antimony alloy from which new batteries were made).
In comes the bureaucracy: no, you need a movement licence for such polluting things. Said movement licence is £25 a time. Immediately, the small feeder tributaries contributing to the grand river of supply dry up.
Car battery recycling levels are still, 20 years later, lower than when we had that purely private sector system managing it.
So if we don\’t do that, then what should we do about cable theft?
Well, cables are cables, you know? It\’s pretty easy to look at some copper scrap and go, yup, you know, that\’s a radiator, that\’s a starter motor and that\’s a cable.
Hmm, is that cable of the railway signalling type? Not household or PC wiring, but of the sort laid out along tracks? Of the sort that\’s being nicked? Cables are covered and on that covering is printed the information about what sort of cable it is. You know \”TS1354, for railway signalling purposes to ISO 3000\” sorta stuff.
Why, yes it is, you Mr. Scrap Dealer are having your collar felt on suspicion of dealing in stolen goods.
It really, really, is that simple. Precisely because of the weird economics, the way that in order to realise the value the material has to be collected into ever larger piles, there are natural choke points in the system.
For example, here is a list of all copper scrap processors in the UK. All 280 of them.
Note that these are not the people who actually melt it down again for reuse. I don\’t think we\’ve got even one of those in the UK at all. These are the guys who take tonne lots and bundle them up into 20 tonne lots. All you need to do to stop cable theft is to put the fear of God into these guys: you deal in nicked cable and we\’ll nick you. If these guys won\’t buy it then nor will the next level down, the material will be of no value and even the thickest of thieves will get the message soon enough.
And that\’s it, you\’re done. There\’s not enough money in it to try setting up your own small furnace to disguise the source of the copper (as there allegedly was with the Brinks Mat gold).
When you can control this problem so easily, why insist that the bloke who collects the old X-Rays from the hospital in return for a drink to the radiologist (yes, we, well, not we as in me but, do recycle these, silver in them) cannot deal in cash?