Metals ALUMINIUM IS BITING INTO COPPER’S MARKETS

Press, Volume CVI, Issue 31161, 10 September 1966, Page 14

Metals ALUMINIUM IS BITING INTO COPPER’S MARKETS

(By LEA FITZGERALD in New York) (Reprinted from the “Auetrohan Financial Retiew' .bv arranpement.

Tired of coping with shortages and wildly fluctuating prices, copper users are substituting aluminium, steel and plastics in their piodtK s wherever possible—and are finding an impressive range of substitutes available.

Moreover, more users are joining the ranks of the “switchables even as the Great Copper Shortage of 1966 begins to fade and some of the sky-high prices recently charged for copper nose-dived. And more than a few users say they do not intend to go back to coppei hate\ er happens.

That is the conclusion of a nation-wide industry' survey by the “Wall Street Journal,” published in New York last week.

Meanwhile, makers of competing materials are going aggressively after copper’s remaining markets to widen their gains. Example: “Alcoa meets your copper-shortage problems with aluminumavailable answers.” says the headline on full-page newspaper advertisements by the Aluminum Co. of America.

The text urges switching “not as a temporary substitute. but as a permanent change for the better.”

Aluminium Radiators Among other things. Alcoa is trying to talk Detroit into putting aluminium rather than copper or brass radiators into its new cars. One Alcoa executive predicts that aluminium radiators will be standard equipment on some of the 1968-model cars that will go into production about a year from now. An avid military demand for copper and brass, which go heavily into equipment .used in the Vietnam war, has helped to produce the copper shortage. But aluminium men say the Pentagon is now working on a “crash programme” to develop smallarms cartridges made of aluminium rather than brass (which is made of copper and zinc).

The survey comments: “One reason for the continuing and accelerating substitutions is that many copper users don’t quite believe the current slide in the copper market is for real. They fear that supplies may tighten up and that prices may zoom again soon. For one thing, they note, the Government now requires United States copper producers to “set aside” for potential defence use 18 per cent of the metal they turn out, up from a former 13 per cent. This, they say, will hold down supplies to the civilian market. “Also, many users think there is a strong possibility of a United States copper strike next year when present labour contracts expire. Even if there isn’t a strike, they fear, the many copper consumers who can’t readily substitute will seek shortly to buy so much copper for strike-hedge inventories that the metal will again become nearly impossible to get.” “Extravagant prices of foreign copper led to the substitutions but now that prices are back down, these

users will come back," predicted Jean Vuillequez, president of Ametalco United States sales arm of Roan Selection Trust Ltd., which mines copper in Africa. But that is not what many big American users say.

Substitutions Speeded

Some of the biggest copper users have actually been speeding up their substitutions even as copper supplies eased and prices tumbled.

American Electric Power Company, which operates utilities in seven States, already uses aluminium, rather than copper, in almost all its transmission and distribution lines. Now it is turning away from copper in the giant "disconnect” switches used in its substations. There switches, used on 345,000-volt lines, weigh from 100 pounds to three tons each, and usually are bought in sets of three at prices up to 3500 United States dollars each—when they contain copper. American Electric says it has bought switches containing aluminium for 25 per cent less. Commonwealth Edison, too, already uses aluminium in “almost 100 per cent” of its overhead lines. Like American Electric, it now is looking for other places to get rid of copper, and thinks it has found a likely candidate in electrical busbars. These are half-inch thick and Bin wide strips of metal used to distribute power in heavy load areas.

“Last year we bought 75,000 pounds of copper for these,” an Edison official told the survey. “This year we’re not buying any—we are going to aluminium instead.” Essex wire corporation, a leading maker of wire and cable, is building a plant in Kentucky that will enable it to make 60 million pounds of heavy utility wire a year out of aluminium, triple its current capacity. This company so far has substituted aluminium for copper in only 5 per cent of its products, but expects that by 1970' aluminium will have replaced copper in 20 per cent to 25 per cent of its product line. Some copper users gave the survey the impression they were so tired of the metal’s price and supply swings that “they hardly care what happens now.” “At least the aluminium market is stable —the copper market is always jumping all over the place,” complained the operator of a Cleveland brass and aluminium foundry. He is

actively suggesting to his customers that they buy aluminium instead of brass whenever they can save money by doing so, and said some have realised savings up to 20 per cent. Steel and Plastics

Akron Brass Company, a 'subsidiary of Premier Industrial Corporation, now uses |pyrolite, a special aluminium I alloy, in valves, nozzles and hose connectors in much of the fire-fighting equipment it supplies. In other products it has been forced to use stainless steel and plastics for brass. "Without a doubt, we’re going to stay with many of the substitutes we've found,” an Akron executive said. Even substitutors who say they might go back to copper sometimes add that any such return could well be only temporary. Westinghouse Electric Corporation has "developed in many products alternative production plants so that we can switch from copper to aluminium and back readily as price and supply dictate,” reported R L. Wells, vice-president for engineering.

Westinghouse today is makj ing many of its smaller distribution transformers used 'on utility poles, with coils , made of insulated aluminium foil instead of copper wire. The company recently ' brought 150 of its design together for a seminar devoted exclusively to discussion of plans for switches from copper to aluminium in other items. “How extensive substitutions for copper already have become is difficult to pin down," says the “Wall Street Journal’s” survey. “But there is evidence, in the sales trends of makers of competing materials, that in some products it has become quite widespread indeed.” The electrical industry has been dominated by copper, but last year, according to the Aluminium Association, it became aluminium's fastest-growing market. Shipments of aluminium to the electrical industry jumped 29 per cent last year to more than 1000 million pounds. Ray Hughes, of the Carlon Products division of Continental Oil Company, said his firm expects to sell twice as much plastic drain-vent pipe for homes this year as it did in 1965—“ and 30 per cent of that gain can be tied directly to the shortage and high price of copper.” He said municipalities were switching to a special type of plastic pipe for main-to-meter water lines costing about a quarter as much as copper tubing. Esco Corporation of Portland, distributor of stainless steel, is experiencing a 10 per cent pick-up in sales because customers are using stainless steel alloy in place of copper-nickel alloys in marine, restaurant and construction applications. Republic Steel Corporation is plugging a new “soft" stainless steel sheeting to replace copper in home roofing and flashing. Because of its strength, the steel can be installed in thinner sheets at a cost saving of 40 per cent to 50 per cent over copper, its makers say.

Copper’s Markets But, adds the “Wall Street Journal’s” survey, despite all this, copper’s excellent electrical and heat conductivity, corrosion resistance and workability make it indispensable in some markets — and these markets are growing. “Even if substitution increases over the next few years, it will just release more and more copper for the uses to which it is best suited,” said Frank L. Wideman, commodities specialist at the United States Bureau of Mines. “Thus, as a result of substitution, we may have stabilisation in the long run instead of copper’s historic ups and downs.” Mr Wideman also forecast big new markets for copper in cyrongenics (the handling of materials at extreme cold temperatures) and in equipment for water-desalting plants.