The department placed its final order for blank pennies from the United States Mint earlier this month
The U.S. Treasury Department has announced plans to halt production of the one-cent coin, commonly known as the penny, following bipartisan legislative efforts (S. 1525 and H.R. 3074) and a directive from President Trump, who called the coin’s production “wasteful.”
The department placed its final order for blank pennies from the United States Mint earlier this month, as first reported by The Wall Street Journal, and cent circulation is expected to wind down once those inventories are exhausted. Earlier this year, the Department of Government Efficiency (DOGE) also weighed in on the issue, posting on X about the high cost of penny production and citing data reported by CoinNews.
Each penny now costs 3.69 cents to produce – more than triple its face value and up 20.2% from 2023 alone – while the nickel costs even more at 9.63 cents apiece, according to the Mint’s fiscal year 2024 annual report. Combined, the two lowest denominations drained $103 million last year – $85.3 million for the penny and $17.7 million for the nickel. It marked the nineteenth consecutive year that the cost of producing both coins exceeded their face values.
Ending penny production is projected to save tens of millions annually, though shared minting costs will shift to other denominations, raising their production expenses. According to the Mint’s most recent annual report, as previously reported by CoinNews, the cost to produce and distribute the remaining coins was 5.76 cents for a dime, 14.68 cents for a quarter, and 33.97 cents for a half dollar.
The U.S. Mint is exploring more cost-effective ways to produce the five-cent coin and other denominations, focusing on alternative metal compositions and enhanced manufacturing methods. In its 2022 Biennial Report to Congress, the Mint identified an 80/20 cupronickel alloy – 80% copper and 20% nickel – as a viable alternative that could be implemented roughly one year after receiving congressional authorization. The proposed composition is intended to lower production costs while remaining compatible with existing coin-handling equipment.
Lincoln cents are composed of 2.5% copper, with the remainder in zinc. Five-cent coins contain 25% nickel, with the balance in copper. Dimes, quarters, and half dollars each consist of 8.33% nickel, with the rest in copper.
In calendar year 2024, the U.S. Mint produced approximately 3.23 billion pennies, representing about 57.5% of the year’s total coin output of 5.61 billion. An estimated 114 billion one-cent coins remain in circulation, though many see little active use. They will continue to be accepted as legal tender even after production ends. Over time, cash transactions are expected to round to the nearest nickel – a system already adopted by countries like Canada, which phased out its penny in 2012.
First struck in 1793 and bearing Lincoln’s profile since 1909, the penny has long been a subject of debate. Critics argue that eliminating it will streamline cash transactions and reduce government waste, while others express concern over rounding impacts and potential effects on charitable giving.
