Metal Prices Hit Record High In 2011

Dec. 20–Even though the prices of metals — ranging from gold to aluminum to copper — saw record highs in early 2011, prices of most of these items have started trending downward as the years winds to an end.

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The prices of metal are important because they determine the cost of practically every item, from automobiles to homes to small to television. Gold in particular is that standard to which the prices of everything else is judged.

"It's basic supply and demand," said Ken Cohen, the owner of Cohen Brothers, Inc., which operates two scrap yards in Butler County and more than two dozen others in Southwest Ohio, Kentucky and Tennessee. "Car manufacturing is down. With home sales down, there no need for appliances. These are the things that drive metal demand and they aren't there right now."

The exception to this trend is gold, whose prices continue to climb as the year draws to a close.

"Business is booming," said Justin Lankford, the owner of 999 Fine Gold and Coin in Hamilton. Since opening last year, Lankford estimates he's seen 3220 percent increase in business in his company which buys and sells gold as an investment item.

Gold is trading at 15.8 percent higher than it was this time last year on the stock market, with an ounce of gold worth about $1,600, according to the Commodities Exchange Center listed on cnbc.com. This is down from it's high point, when an ounce sold for $1,925 in early September. Meanwhile silver is trading at about the same as it was last year, with a less than 1 percent drop. The price of copper is down 15.88 percent from this time last year, selling for $3.38 an ounce after a high point of $4.58 an ounce in February. Platinum is down 16 percent to selling at $1,432 an ounce, down from a high of $1,916 an ounce in August.

Aluminium is down 10. 77 percent, according to tradingeconomics.com. In April, aluminium reached it's historic high, when it was worth $1.26 per pound on the open market. It has since dropped to .99 a pound, according to the site. While prices are down, they are still higher than their average price following spikes in the metals market in spring of this year.

The drop in prices for non-gold metals has caused buying and selling of scrap metal to decline, Cohen said.

Prices of metals like aluminium and copper are down approximately 20-25 percent from where they were just a few months ago, said Cohen.

Cohen said he is currently buying aluminum at .50 a pound, compared to .70 over the summer. Copper is being purchased for $3 a pound, down from $4. Aluminium cans are being purchased for .60 a pound, down from .70-.80 cents.

The winter months also play a factor, Cohen said, with scavengers simply not willing to brave the cold to search for precious metals to sell.

Lankford, however, said he believes the price for gold will continue to rise in the coming months.

Lankford said he has a wide range of clientele.

"Some people are just living paycheck-to-paycheck, hoping to sell enough to pay their heating bill or electric but other people have just held on to their gold for a long time and want to sell it now, to pay for a nice vacation or just have some extra money," Lankford said.

He also said many people favor his opinion that gold prices will continue to rise and are buying it from him as an investment.

"With the dollar continuing to be worth less, something has to be stable and that's why gold's doing so well," Lankford said.

Despite the drop in demand, theft of metals is still a problem for residents and business owners.

Randy Barger, owner of Hamilton Family Fun Center on North Brookwood Drive, had to shut down his business during the summer when thieves stole copper from six air conditioning units from his roof, he said.

With a roller skating rink, basketball court, skateboarding and inflatables, Barger said air conditioning is a necessity to run his business.

"It's a family thing and parents don't want to sit around and be hot," he said, noting he lost a lot of money when he had to close Labor Day weekend.

Barger and other tenants located in the strip mall are waiting for an insurance claim to come through, he said. A total of 22 air conditioning units were ruined when copper was removed from them. He's looking into installing alarms on the units or motion sensor lights on his roof to prevent being targeted from the thieves in the future, he said.

Sgt. Monte Mayer, spokesman for the Butler County Sheriff's Office, said the biggest thing residents and business owners can do to protect themselves is to be vigilant.

"The biggest tip is to be vigilant, not just for yourself, but neighbors too. Vacant homes, or homes that appear empty, are always prime targets because the would-be thieves can get in, get out, and it would be weeks or months before the theft is even discovered," he said.

Scrap metal thefts have been steady for years, but were probably worse in 2011 due to the economy and vacant home numbers, he said.

Contact this reporter at (513) 696-4544 or jmcclelland@coxohio.com.

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(c)2011 the Hamilton JournalNews (Hamilton, Ohio)

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