Surge in the Value of Copper Results in Increased Thefts for Missouri Farmers, says MU Extension Specialist and Business Professor
Nov. 1, 2007
Bryan C. Daniels, (573) 882-9144, DanielsBC@missouri.edu
COLUMBIA, Mo. – Farmers in the Midwest, including Missouri, are increasingly falling victim to a different type of crime wave. It’s not their crops or livestock being stolen; instead, thieves are taking a valuable component from their water irrigation systems – copper.
Currently, copper is valuable; it’s worth a lot of money. After melting and turning it into scrap metal, thieves sell the copper for cash. Meanwhile, farmers are affected by not only added expenses, but also significant yield reduction from down time, said a University of Missouri extension specialist.
“It’s just frustrating to have to repair something that somebody tore up,” said Don Day, a natural resource engineer in central Missouri. “The cost of repairing the standard irrigation system is in the neighborhood of about $5,000. Most farmers have them insured but they probably have a deductible, which they will have to pay. It gets expensive. When this occurs during the season, it sets you back time wise and prevents timely irrigation because of having to wait for repairs.”
In addition to machinery, copper is used for a variety of purposes. It is widely used in the home-building industry for wiring. In the past, suburban areas with newly constructed – but empty – homes were commonly affected. Now, densely populated rural areas are being targeted.
The thefts ultimately result from the increasing value of copper – both from salvagers and worldwide markets. Currently, copper sells for about $3.50 per pound. By comparison, it was worth far less than $1 per pound a few years ago. The international demand is the driving force behind the price surge, said John Stansfield, assistant adjunct professor of finance in the Robert J. Trulaske, Sr. College of Business at MU.
“It’s not surprising that a lot of copper is getting stolen because a lot of what’s out in the field (at the farms) is 10 times more valuable today than when it was installed,” Stansfield said. “The reason for the rapid inflation in price is due to a couple of things. One, of course, is that it always comes down to supply and demand. The real driving factor is the weak U.S. dollar. Since our dollar is cheap, there’s a lot more foreign demand for that copper. Demand adjusts to price. As the value goes up, the export potential increases.”
Nationwide, states lawmakers are considering tougher laws and regulation of the salvage industry to prevent the resale of stolen materials like copper.
Day has worked at MU since 1967. His areas of interest are agriculture engineering, farm building, safety, grain dying and storage, livestock housing and handling and irrigation and master gardeners.
Stansfield has been at MU since 2000. Derivative financial securities and the Chartered Financial Analyst (CFA) program are his areas of interest.
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