Economic Growing Pains: Slower Supply Chains, Limited Supply Pointing to Increases in Prices and Lead Times

The world is opening back up and that’s a good thing. However, as elements of our economy open back up it’s not as if we can just pick up where we left off a year or so ago. As commercial and consumer spending shifted around the world, so to did our global supply chain. If you’re reading this blog you’re probably familiar with the historic rally in the Copper commodity market over the last year but what you may not be hearing about is that we’re seeing inflationary pressure across the board.   The major drivers have been grouped into the following categories:

• Copper (Conductor Material)
• Compounds (Insulating and Jacketing Material)
• Logistics (International and Domestic Shipping)
• Packaging (Lumber and Cardboard)

I’ll share a number of charts that track the prices of each commodity to give you a sense of the dramatic increases we’ve seen over the last year or so. One important thing to keep in mind, these commodity prices represent the material in their raw forms. To transform them into useable materials for wire and cable they must each undergo processes which add to / amplify the increases.

A second important (and confounding) factor putting upward pressure on prices is that none of these factors consider the delays at all US ports of entry (as long as 6 weeks unloading material), or the driver shortage affecting the trucking industry which are contributing factors to a nationwide shortage of these raw materials.

It’s a perfect storm, and it may get worse. From where I sit today, all indications seem to point to continuing increases in prices and lead times.

Charts provided by Trading Economics

Let’s start with copper. For the last couple years, COMEX Copper has traded between $2.50 and $3.00/lb. For reference, the all-time high price topped $4.47 in June of 2011. A few weeks ago, copper climbed as high as $4.34/lb and is currently around $4.19/lb which represents a 100% increase since March 22, 2020. 

As I mentioned earlier, this is just the raw material in its basic bar form. Before it can transmit your signal, the copper is melted down, drawn and rolled into rod which is then drawn down to 9 gauge in the intermediate drawing process and then depending on the wire being made will get a fine drawing to say 23 gauge for Cat6 conductors or for stranded products like speaker wire, it needs to be drawn down to 30 gauge where 65 fine strands get bunched (twisted) together before they can be insulated. Several of these processes could take place in different factories or different parts of the world. All of these steps add to the price of “usable” copper and increases of course are amplified as the raw materials get closer to becoming a final product.

While copper is a major driver of material costs of wire, it’s far from the only factor.  If you’ve ever terminated wire (or really taken a close look at it) you’d see other materials for insulating and jacketing that are made from various types of plastics (yes there are non-plastic materials involved too, but I’m not getting into those here.). Those insulating and jacketing compounds (polyethylene, propylene, etc.) are petroleum based and as Crude prices increase so to do the compound prices.

Resin Prices April 2020 - April 2021
(chart provide by The Plastics Exchange)In addition to Crude Oil prices having increased increased over 300% in the last year, there are even more critical factors at hand for the resin markets. Back in late February a storm hit Texas and shut down approximately 80% of US resin production. and while most resin reactors have restarted,  most producers remain under force majeure and allocations are intact. The problems in the US don't exist in a vacuum and as such the sector is experiencing “severe shortages of raw materials and [unprecedented] price increases,” according to the European Plastics Converters (EUPC) association. According to the PlasticsExchange, "This Polypropylene environment has been like none other in our 20 years of making spot resin markets."

The end of the manufacturing process also has some surprises for us as well. The cost of lumber is at an all-time high (as of today it’s $1,212 per 1,000 board feet). Wood products (think everything from lumber used to frame your house to wood pulp used for toilet paper to cardboard boxes used to deliver your packages) are all effected and so too are the costs of our reels, boxes and skids used to package and carry your wire.

If you’re still reading at this point, I think you get the idea. Our global economy is surging in some unexpected ways and the short-term effects have clearly resulted in a slower supply chain with higher prices. I don’t pretend to know when prices will cool off and lead times will return to normal, but if you’re business counts on wire to get the job done, please plan accordingly, I know ours is! 

OSDP: The Only Secure Access Control Option

 Access control technology has come a long way from the very first method of  “Knock, knock!”  “Who’s there?” to  becoming an integrated network application within an intelligent building.  In the early 1970’s access control moved to being electronically controlled, but still somewhat siloed with the primary function to create barriers from unauthorized persons.  With the introduction a smartphone in 2007, security moved to being controlled and monitored on a remote device, connected to the Internet. Access control systems included both mechanical and electronic hardware devices from basic physical keys and door locks spanning to advanced access control systems encompassing IP features such as biometrics.  As we return to our places of work, a new purpose of access control is emerging to include promoting wellness of inhabitants in addition to safety. Today almost every commercial and residential building employ some sort of electronic access control system and is a collaboration between IT and physical security.

According to ANSI/BICSI-007-2020 standard, “Information Communication Technology Design and Implementation Practices for Intelligent Buildings and Premises,” the components of an access control system are classified into the following levels:

• Level 1 – Central equipment processing, recording, software, and database
• Level 2 – Controllers for intelligent field processing (e.g., data gathering panel)
• Level 3 – Peripheral devices (e.g., card reader, lock, door position switch)
• Level 4 – Credentials (e.g., cards, fobs, biometrics, personal identification numbers [PINs], passwords) 

All of these can be integrated into the data network to provide a complete integrated access control system. Connectivity to edge devices, such as peripheral devices allow sensors to monitor and control passage through entryways. These devices are classified into these categories:

• Door contacts—used for monitoring an open or closed door.
• Readers
• Electrified door hardware
• Request-to-exit devices (REX)

COVID-19 also seems to be accelerating the shift in access control to become mobile and cloud-based solutions.  However, the merging of physical and logical access control systems still face many challenges that impede the journey to a truly digital infrastructure. Designing and implementing a network-based access control system includes assuring that the installed infrastructure utilizes the most secure cabling with advanced security and IP communication capabilities, in addition to being able to update and integrate with other devices.  

OSDP as the New Gold Standard for Access Control

The Security Industry Association (SIA) industry introduced the Open Supervised Device Protocol (OSDP) as the essential standard for access control communications to enable digital access control features with advanced data encryption.

It’s easy to see understand why OSDP has become the security industry’s gold standard replacing old Wiegand-based systems and wiring protocols. Prior to OSDP there was a disconnect between the multiple device components including the readers, hardware, door contacts and controllers. OSDP has advanced functionality and provides a roadmap to future access control devices. 

Wiegand dominated the access control industry for decades but hasn’t kept up to today’s requirements for many critical functions such as secure encryption, which is vital to protect against intercepting transmissions between proximity cards and readers.  Wiegand offers only one-way communication, which becomes vulnerable to “sniffers” and hackers, whereas OSDP has bi-directional communications and supports AES-128 encryption, as used in federal government applications.  This prevents hackers from intercepting data transfers. With bi-direction communication, access control systems are continuously monitored to protect against failed, missing, malfunctioning or tampered readers. OSDP utilizes the RS-485 protocol for the cabling and facilitates longer distances and is more robust to mask interference.

There are even more reasons to make a move to OSDP. Wiegand readers require homerun pulls from the control panel to each peripheral device. OSDP has a concept called “multi-drop” that allows devices to daisy chain directly from the controller to the reader and then to a secondary reader and so on.  This reduces the number of ports on the controller, as well as the number of individual cable runs, saving on cabling and installation time.   OSDP requires as few as two pairs compared to 6-12 (or more) conductors used in Wiegand.  In addition, OSDP works with biometric devices and allows for remote configurations and upgrades, while Wiegand employs time-consuming workarounds. 

Composite OSDP Access Control Cable by Paige

 

Connecting with Paige OSDP Cable

Recently Paige introduced a family of OSDP composite cables for today’s most advanced access control systems utilizing the OSDP protocol. The low-capacitance card reader component allows for distances to extend out to 4,000’ versus being limited to 500’ with Wiegand. In addition, to having fewer wires OSDP leverages the bi-directional communication to allow for simplified remote upgrades and configurations not possible with Wiegand systems. Because these are based on OSDP standards, they can easily integrate with other building systems like video or gunshot detection.   

The Paige OSDP reader cable consists of 2 pairs of 24 AWG stranded bare copper cable with an overall tinned copper shield and a low-smoke PVC plenum-rated jacket. Meeting RS-485 communication protocols this cable is available in 1000’ lengths. 

The composite cable consists of four components that are cabled together with an overall yellow jacket. The cable is rated to a 75°C operating temperature and meets UL-444 plenum rating and is available in lengths of 500’ and 1000’. Cables can be spliced together to extend the distance. The individual cable components are color-coded to allow easy application identification. The components include:

• Component 1: Reader - Orange inner jacket, shielded with 24 AWG/2 conductors; 
• Component 2: Contacts - White inner jacket, unshielded with 22 AWG/4 conductors;
• Component 3: REX/Power - Blue inner jacket, shielded 18 AWG/4 conductors;
• Component 4 - Lock Power or AUX: Gray inner jacket, unshielded 18 AWG/4 conductors.

If you want to make sure your access control system is integrated into your intelligent building to deliver the highest security capacities, contact Paige: https://www.paigedatacom.com/osdp

This case study explains how Advanced Network Management (ANM) simplified the IT infrastructure for an International Airport while reducing costs and eliminating potential points of failure.

The Situation

ANM, an IT consultancy based in Albuquerque, NM was asked to participate in a large security system upgrade project at a major airport in the Western US.

ANM’s role was to upgrade the security camera infrastructure of approximately 700 cameras at the airport. Since higher resolution, PTZ cameras were being installed, it would also be necessary to upgrade most of the cabling that supports these new cameras. All the existing IP cameras had been on Cat5 and Cat5E and many of the original cameras at the airport were analog and using coax cabling and copper power conductors.

Like most airports, there was an immense, sprawling layout that would require numerous long-distance cable runs. In many cases, the location where the camera was needed would easily exceed the typical Category 6 cable distance of 100 meters to the nearest IDF or network closet. 

The Solution

John Pace, ANM’s Project Manager and his team considered various options for the airport project. The initial plan that was considered would utilize fiber, along with copper conductors to power remote media converters. However, the client’s IT staff preferred not having new devices placed across the facility and Pace said they “did not want to have a scenario where devices could fail out in the field and would have to be located and dealt with by their staff at a later date.”

John Pace then discovered an alternative solution - GameChanger Cable from Paige. And for this installation, it did in fact, prove to be a game changer. 

With GameChanger Cable, ANM found an easy, fast, and cost-effective way to take networking infrastructure beyond the 100-meter limit. With increased gauge size, carefully designed twisting and specialty materials, GameChanger is optimized for long distance Ethernet applications. It is UL verified to deliver 1 Gb/s performance and PoE+ over 200 meters. UL has also verified it to deliver 10 Mb/s over 850 feet.

As John Pace described, “GameChanger turned out to be a very viable cost-effective alternative to running fiber and media converters, in the instances where the cabling requirements exceeded 328 feet for a network drop.” He added, “The GameChanger was a really good option from a cost-effectiveness standpoint and the ability to eliminate any kind of media converters or signal boosters or anything in-line on these cable runs.”

Click to download the full case study

 John Pace shelved the original plan to use fiber as “obviously that was cost prohibitive compared to the GameChanger.” He added, “In addition to the cost factor with the fiber and the media converters, we avoided adding additional points of failure into the system by being able to use GameChanger. So that was a win-win for us and the airport.”

After successfully using GameChanger Cable in the airport, John Pace feels it can be “a perfect fit” for all kinds of other projects, especially those where “their infrastructure is already established, and their budgets are limited.” He sees it as potentially an ideal solution for the numerous projects they do on school campuses, and he says that GameChanger “will be in our arsenal of solutions to these kinds of long-distance problems.” 

About ANM

ANM is ranked by CRN as one of the fastest growing technology solutions providers in the U.S. It specializes in the fastest-growing areas of IT, including enterprise networking, cloud, remote workforce solutions, collaboration, security, cabling, and audio visual. ANM was founded in 1994 and maintains its headquarters in Albuquerque, NM and has additional locations throughout the western United States.  

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