U.S Mint Loses Millions Producing Pennies

Row of pennies
The penny is the most abundant coin in the United States with approximately 8.4 billion in circulation last year. Made mostly of zinc and some copper, the cost to produce and ship this low value coin has risen to $0.0182 each. This is a 69 million dollar loss compared to their total value, which is the biggest loss in 9 years.

According to CoinNews.net, “The toll to produce, administer and distribute the 1-cent coin was 1.82 cents in FY 2017 compared to 1.50 cents a year earlier. For the 5-cent coin, the cost went up to 6.60 cents from 6.32 cents. Higher metal prices were one factor in the increases.”

The rising cost in production is likely due to the rising cost of zinc which is used in industries such as machine and ship building, construction, steel production and heavy industry.

In addition to the penny, nickels have become costly to manufacture as well. Although their face value is $.05, it actually costs $.07 to produce. These coins are made of 75% copper and the price of copper has soared over the years.

Dime and quarters are cheap to manufacture so this has helped the U.S. Mint to offset the costs of producing the pennies and nickels. Last year the mint reported making $391.5 million in seigniorage.