Trade and Industry

Thursday, 25 August 2022

Measures to prevent theft of scrap metal

  • Year: 2022
  • Organisation: TIPS
  • Countries and Regions: South Africa
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Theft of scrap metal, especially copper cable, imposes costs far beyond the actual value of the material taken. These costs, mostly in the form of disruptions to rail transport and electricity, effectively cut production and foreign sales worth tens of billions of rand a year

Scrap metal is also a critical input for most metals refineries, including both copper fabrication and basic steel. In consequence, illegal exports effectively raise input costs for local producers across these value chains, which are among South Africa’s most advanced. They effectively both incentivise theft and facilitate export-parity pricing for scrap metals, with the resulting rents going to scrap traders instead of boosting local manufacturing.

The Department of Trade, Industry and Competition (the dtic) commissioned TIPS to evaluate the economic and legal effectiveness and viability of measures to limit the theft of scrap metal. This includes an assessment of the economic impacts of the thefts; an investigation of systemic vulnerabilities that enable theft to continue in the scrap metal value chain; a set of proposals to narrow the scope for theft of scrap metal; and a look at international trends in scrap metal production and sale, as well as experiences in regulating it, to help identify ways to address the problem more effectively.

MEDIA ARTICLES

Government’s new plan to crack down on copper theft in South Africa (BusinessTech 5 August 2022)

Ambitious plan launched to fight copper theft (Sunday World 9 August 2022)

Govt will make it harder to sell scrap metal, not ban trade outright - Patel (Fin24 23 August 2022)