The Trump administration has announced plans to discontinue the production of the penny, citing rising production costs that have increased by more than 20% in 2024. The U.S. Mint has placed its final order for penny blanks and will cease production once these are exhausted, resulting in estimated annual savings of $56 million in material costs.
In February, President Trump directed his administration to halt penny production, highlighting the inefficiency of minting coins that cost more than their face value. Currently, there are approximately 114 billion pennies in circulation, valued at $1.14 billion, but the Treasury notes they are underutilized. The penny has been in circulation since the establishment of the U.S. Mint in 1792.
The U.S. Treasury Secretary has the authority to manage coin production, and while there have been past congressional attempts to eliminate the penny, they have not succeeded. Recently, two bipartisan bills aimed at permanently discontinuing the penny have been introduced.
Advocates for abolishing the penny point to its high production cost, with the U.S. Mint reporting that it now costs almost 4 cents to produce each penny. However, supporters of the penny argue for its utility in charity and its lower production cost compared to the nickel, which costs nearly 14 cents to mint.
Experts suggest that any legislation to eliminate the penny should include provisions for rounding prices to mitigate increased demand for nickels, which could lead to further financial losses in coin production.
