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Not all that glitters is good news

The police revealed figures last year showing that metal theft was heading down in 2012 – the same year they were calling for more funding to fight metal theft that was allegedly spiralling upwards out of control.

In 2012 new legislation was still some way off, but publicity and voluntary measures were having an effect. The real difference was that the owners of material containing metal, such as BT and Network Rail, got off their backsides and started to protect it. The police had shown no interest in large-scale, high-value, metal theft from scrap yards and little interest in the sort of low-level crime that most theft involved.

So politicians decided that we, the scrap dealers, would have to do the police’s job for them. It was supposedly our fault for using real money to pay for this metal. But the naive and mistaken belief that theft can be prevented by legislation and changing the type of payment is rubbish.

The British Metals Recycling Association tried to put a gloss on a very poor piece of legislation by suggesting that their members would gain an advantage and thrive when the unlicensed cowboys were put out of business. It seemed to believe that lots of people would be refused licences and so it was good legislation – they haven’t and it isn’t.

In addition, BMRA members need the tonnage that these people bring – it is the staple diet of many city and town centre yards. I accept that there was very little they could do in the face of a barrage of misinformation and public backlash, and it would not look good for a trade body to speak out against what was being presented, and still is, as a panacea for metal theft.

The proactive anti-theft measures, coupled with low prices, are why metal theft is falling. Let’s face it: the whole thing was blamed on sky-high metal prices so, using the same logic, low prices were bound to have the opposite effect. Perhaps now the media hysteria has died down they have started reporting stolen items as what they are – a bike for instance – rather than scrap metal.

The scrap industry is currently going through the toughest times it has seen in recent years. Prices are back where they were a decade ago but, critically, volumes have slumped from already low levels.

The real issue is the fight for survival that has started a journey to the bottom in terms of margins, which have shrunk to ridiculous levels. Merchants posted losses and dismal results for 2013-14 and it has got much worse since then. Companies are wearing equipment out and exhausting cash and stock reserves while making a loss or very small profits.

We are now seeing a steady stream of closures and administrations. Companies have been hanging on for better days but that is not going to happen any time soon. There are too many of us chasing too little business.

Mark Schofield, director of scrap metal dealer JB Schofield

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