CSC provides info on rising copper prices

May 10, 2006 - The commodity has climbed a remarkable 138 percent since January 2005.

In an e-mail newsletter distributed on May 5, Communications Supply Corp. (www.gocsc.com) alerted professionals in the communications cabling industry to the sharply rising price of copper, and explained how these rising commodity prices affect the cost of copper-based cable.

"Since April 7, worldwide commodities used in the manufacturing of data communications and low voltage wire and cable products continue to experience sharp increases in demand," the CSC newsletter said. "This is resulting in inflationary cost pressures on the market at an unprecedented rate."

The newsletter points out that copper prices have increased more than 92 cents per pound since the beginning of April—about one month's time. Increases sometimes approached 20 cents per day, CSC added. By comparison, copper prices increased a total of 75 cents in all of 2005. Overall, the price of copper has increased 58 percent since January 2006 and an amazing 138 percent since January 2005.

Other materials used in the manufacture and distribution of wire and cable products are also getting more expensive, and in some cases setting record highs, CSC noted. Chemicals such as polyvinyl chloride (PVC) resisn and polyethylene are derived from crude oil—the price of which has been top-story national news for several weeks. Increased fuel charges also drive up freight costs from all suppliers, of cable and virtually every other product.

The newsletter also gave some detail on the annual consumption-versus-production of copper, and pointed to China's continuing industrialization and urbanization initiatives as one cause of the production deficit (or consumption surplus).

The bottom line for members of the cabling industry is that manufacturers have significantly raised their pricing in the market.

Information contained within CSC's newsletter was also included in a letter to the distributor issued to customers and other industry professionals. It includes charts illustrating raw copper prices since January 2005, five-year copper warehouse stock levels, rubber and plastics pricing dating to January 2005, and crude oil pricing since December. You can read that letter, available online as a PDF, by clicking here.

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