It looks like change is coming for the penny as the U.S. Treasury Department plans to stop the production of pennies after President Donald Trump called it “wasteful.”
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According to the Wall Street Journal, after more than two centuries (about 233 years), the U.S. government will soon begin phasing out penny production. The publication stated that the Treasury Department will stop putting new pennies into circulation by early 2026. Moving forward, there will no longer be enough pennies to use in everyday cash transactions. Therefore, the Treasury says businesses will now need to round up or down to the nearest 5 cents.
In its statement, the Treasury Department noted that the U.S. Mint, which it oversees, will stop producing new pennies once it runs out of blank templates used to make the coins, mostly made of copper and zinc. The Treasury confirmed that it made its final order of penny blanks this month. In its annual report to Congress, the U.S. Mint reported a $85.3 million loss from making pennies in fiscal year 2024.
As the penny heads for retirement, the Treasury Department is expected to save around $56 million annually by reducing material costs. The Treasury Department said, “Additional savings will accrue as facility usage is adjusted and other efficiencies are achieved with the reduced production.”
Donald Trump And Elon Musk’s DOGE Speak On ‘Wasteful’ Penny Production
The move arrives just months after President Donald Trump criticized the production of pennies in February, calling it “wasteful.” While taking to his Truth Social platform, Trump said the cost of minting pennies, which features America’s 16th president, Abraham Lincoln, is more than twice the currency’s face value. He said:
“For far too long the United States has minted pennies, which literally cost us more than 2 cents. This is wasteful! I have instructed my Secretary of Treasury to stop producing new pennies. Let’s rip the waste out of our great nation’s budget, even if it’s a penny at a time.”
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A month before this, an X post from the Elon Musk-led Department of Government Efficiency (DOGE) wrote:
“The penny costs over 3 cents to make and cost US taxpayers over $179 million in FY2023. The Mint produced over 4.5 billion pennies in FY2023, around 40% of the 11.4 billion coins for circulation produced. Penny (or 3 cents!) for your thoughts.”
According to the U.S. Treasury Department, the costs of producing one single penny has more than doubled in the past 10 years. The cost has risen from 1.3 cents to 3.69 cents in 2024. Additionally, the U.S. Mint states that printing a paper $1 bill proves to be cheaper than producing a penny.
A single penny is made up of 97.5% zinc and 2.5% copper and requires a smelting process to mold the metals. Meanwhile, the Federal Reserve notes that it costs the Treasury’s Bureau of Engraving and Printing 3.2 cents to print a $1 bill.
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