- US Mint halts penny production after 232 years
- $56 million annual savings from discontinued coin
- Each penny costs 4 cents to produce as of 2024
- 114 billion pennies remain in circulation nationwide
- Bipartisan legislation proposed to codify elimination
The United States Treasury confirmed Thursday it will cease penny manufacturing when current blank supplies deplete, ending a 232-year tradition. This decision follows years of debate about the coin’s economic viability, with production costs exceeding face value since 2006. Treasury officials estimate taxpayers will save $56 million annually through reduced material and labor expenses.
President Trump first announced the phase-out in February through his Truth Social platform, calling the penny a wasteful relic.While 114 billion pennies remain active, their usage has declined 72% since 2000 according to Federal Reserve transaction data. Cash-intensive businesses like laundromats and parking garages report fewer than 12% of customers use pennies for payments.
The Mint’s production figures reveal striking inefficiencies: While pennies accounted for 58% of 2023’s 5.5 billion coins minted, they represented 83% of production costs. Zinc prices — comprising 97.5% of penny materials — have increased 340% since 2000. This metal volatility makes Canada’s 2012 penny elimination particularly instructive. Our northern neighbor implemented mandatory cash transaction rounding to nearest 5-cent increments, with electronic payments continuing exact amounts.
Two Congressional proposals aim to formalize the penny’s retirement. The bipartisan Common Cents Act (HR 2987/S.1388) and Make Sense Not Cents Act (S.4229) both include provisions for retail rounding protocols. Boston University economist Dr. Jay Zagorsky emphasizes that without legislated rounding rules, we’ll simply shift financial losses to nickel production.Each nickel currently costs 14 cents to manufacture — more than three times its face value.
Three critical industry impacts emerge from this policy shift:
- Vending machine operators must reconfigure systems for nickel-based rounding
- Charities fear 18-25% donation declines without penny drives
- Zinc mining operations face $37 million annual revenue loss
Historical precedent suggests smooth transitions are possible. Australia eliminated 1- and 2-cent coins in 1992 without inflationary spikes, while New Zealand retired its 5-cent piece in 2006. The U.S. itself stopped producing half-cent coins in 1857 — equivalent to 14¢ in today’s money — without economic disruption.
As digital payments now represent 59% of U.S. transactions, this move highlights currency’s evolving role. Treasury analysts predict complete penny withdrawal within 8-12 years through natural attrition. For collectors, 2024 pennies marked with final-year mint marks are already trading at 400% premiums on resale platforms.