German railway operator Deutsche Bahn has been struggling for quite a while now. Decades of neglect have left the state-owned company’s infrastructure and rolling stock in tatters and its finances in disarray.
Deutsche Bahn’s precarious funding is now being additionally burdened by a rising number of copper thefts that in 2022 alone cost the company about €6.6 million ($7 million), according to German business daily Handelsblatt. This year, the newspaper found, copper thefts have already led to 2,644 train delays, totaling well over 700 hours.
As criminals destroy cable ducts to get hold of the valuable base metal, supply chains are disrupted and hundreds of thousands of passengers are getting increasingly frustrated about Deutsche Bahn’s impunctuality.
But it’s not only the German national railway company that suffers from the rising theft of so-called nonferrous metals like copper. Copper wiring and pipes are stolen from construction sites. Even church rooves that are often laid with copper plates are no longer safe from acts of criminal wrongdoing.
The most spectacular copper theft of all time in Germany, though, happened at copper manufacturing and recycling company Aurubis in August. The Hamburg-based company disclosed it was a victim of a major theft involving nearly $200 million (€188.7 million) worth of the base metal.
Critical raw material in short supply
After the news of the theft broke at the end of August, Aurubis, Europe’s largest copper producer, said it suspected a criminal gang had stolen some of its metal. The company disclosed that due to “considerable discrepancies” in its inventories it would miss its full-year profit guidance.
Copper is a base metal that is used in multiple appliances and applications due to its good electrical conductivity. It’s become even more critical in the transformation of entire industries toward carbon neutrality, says Joachim Berlenbach, founder and CEO of the Earth Resource Investment (ERI) consultancy. He added that he has no doubt that “the demand for copper will increase massively in the future.”
“Think of a wind turbine generating electricity by spinning a copper coil through a magnetic field. For each megawatt of wind energy, you need five to nine tons of copper, depending on whether the turbine is onshore or offshore,” Berlenbach told DW.
Prices will continue to rise, he said, because “we simply don’t have enough of this critical raw material for achieving our decarbonization goals. This is often ignored by advocates of the energy transition.”
Economic development to drive up copper prices
Berlenbach thinks that a main driver of future copper prices will be the economic development in emerging countries like China and India where rising standards of living will lead to “more cars being driven, more air conditioning systems being installed and more houses with better electrical wiring being constructed.”
The ERI CEO said humans have mined 700 million tons of copper in total so far. “We will need about the same amount of copper in the next 30 years,” he added, basing his assumption on calculations done at his company.
At the same time, it’s becoming “increasingly difficult to explore and mine copper deposits,” he said, noting that those are mainly to be found in countries with high geopolitical risk such as Chile and the Democratic Republic of Congo (DRC)), where companies will only invest “if it’s economically worthwhile.”
Where has all the stolen copper gone?
The Aurubis copper fraud took place in the realm of financial bookkeeping which made it possible for the criminals to remain undisclosed for a long time. After all, selling stolen copper on the hugely regulated European recycling market isn’t easy, says Ralf Schmitz from the Association of German Metal Traders and Recyclers (VDM).
Every deal or delivery has to be recorded, he told the German daily Tagesspiegel recently, adding: “What gets stolen is known to the traders. This also applies to our eastern neighbor Poland which has a similar system.”
Schmitz suspects that metal thieves mainly sell their contraband outside of Germany because open borders facilitate illegal shipments. Or even further afar: “The bulk of the stolen metals is no longer sold in Europe. Most of the material, in my theory, goes overseas in containers.”
‘No substitute for copper’
As the prices of copper and other metals rise, criminals are becoming better organized and more ruthless. Police investigating the Aurubis theft have seized firearms and ammunition alongside more than €200,000 ($212,000) in cash and several cars.
ERI CEO Berlenbach said when he hears about copper thefts in Germany he often is reminded about his time in South Africa, where he once worked. “The problem of copper theft was similarly dramatic in South Africa. At one time, all the telephone lines in my neighborhood in Johannesburg were ripped out. It must have been a well-organized gang with contacts to professional buyers.”
And yet, Berlenbach can’t think of any effective method to protect critical infrastructures like railways and electrical grids from metal theft. “Unfortunately, there is no substitute for copper cables, it’s a matter of physics.”
This article was originally written in German.