BIR Issues Statement Concerning Increased Metal Theft in China

The Bureau of International Recycling, Brussels, has issued a statement relating to concerns over what it calls a sharp increase in the theft of some recyclable commodities from containers shipped overseas.

According to BIR, the situation appears to be particularly noteworthy in the southern part of China.

To tackle the issue, BIR’s Secretariat, on behalf of its nonferrous division, is surveying BIR member companies anonymously to obtain information on the nature of the thefts, including the quantity and value of the stolen materials, ports used, shipping lines and other information.

In a letter addressed to member companies, Francis Veys, director general of BIR, says many members have taken precautionary measures such as using heavy duty locks and seals to prevent the doors of containers being removed to allow for the theft of scrap metal.

Veys says members are reporting high-value materials such as high grade copper scrap being generally targeted, “which leads us to believe that there is complicity among the few people who are aware of the contents of the containers.”

The association has approached the International Chamber of Commerce (ICC) for assistance. The BIR has contacted ICC’s Commercial Crime Services and its International Maritime Bureau, which regularly investigate container losses on behalf of its members.

The letter from the BIR notes that should the association receive sufficient responses to its survey, further actions will be taken at the ICC level with other authorities.

David Chiao, vice president of Uni-All Group Ltd., a brokerage firm based in Atlanta, says two of his customers have sustained losses in February 2012 of materials valued at more than $100,000 each. He believes the thefts may have occurred near Nanhai, in southern China, possibly during the stevedoring process.

Importers have claimed dirt, rocks or iron ore were added to containers, apparently to replace the weight of the missing material.

“This isn’t shoplifting,” Chiao says. “Now it’s organized crime." Chiao said the thefts have been reported to authorities in China, and that claims to insurance companies for the stolen materials have been rejected.

Chiao says his biggest concern is what the thefts impact will have on importers, who are either building the theft losses into their costs or may decide to halt imports until the situation improves.

“Of course we are hoping for a very in-depth investigation of this organized crime,” Chiao says.

Meanwhile, the Institute of Steel Recycling Industries (ISRI), Washinton, D.C., also is starting to investigate the issue, says Scott Horne, ISRI general counsel and vice president for government affairs. “We are talking to a number of U.S. government agencies; we are talking with foreign governments, both with people in the country and at their embassies,” he says.

While not commenting on how widespread the situation may be, Horne says the losses sustained in instances he’s aware of have been significant.

“Now that it has become a significant problem for some members we are becoming more involved,” Horne says.

Horne urges exporters to be sure contract terms with carriers are appropriate. “Shippers who enter into contracts with a carrier have the right to negotiate,” he notes. Horne also says shippers who experience theft need to make their carriers aware of the problem, and they should address any provision in the contract that would otherwise absolve the carrier from liability.

“I would put the carrier on notice,” says Horne, “and you should try and negotiate terms that will help protect your material in transit.”