The U.S. penny, long a staple of American currency, is approaching its end due to inefficiency and high production costs. Each penny costs approximately 3.69 cents to manufacture and distribute, nearly four times its face value. This cost has steadily risen, increasing by over 20% since the previous year. The U.S. Mint has responded to this economic imbalance by announcing the end of new penny production after its current supply of blanks is depleted, following former President Donald Trump’s push to eliminate the coin.
Nickels, Dimes and Quarters All Face Rising Costs and Declining Circulation in 2024
While the penny garners the most attention, the nickel is also a major financial burden. It costs 13.78 cents to produce, almost three times its face value. This has been a consistent trend for 19 years, where both the penny and the nickel have exceeded their value in production cost. The 2024 fiscal year saw a drastic reduction in nickel circulation, with just 202 million shipped compared to 1.42 billion the previous year, further reflecting shifting production strategies.
U.S. Mint Ends Penny Production as Coin Costs Soar and Paper Currency Proves More EfficientDimes and quarters are not immune to increasing costs. The dime costs 5.76 cents to produce—over half its value—and saw an 8.7% price increase from the prior year. The U.S. Mint shipped 840 million dimes in 2024, a significant decrease from the 2.67 billion in 2023. Similarly, the quarter’s cost rose to 14.68 cents, a 26.2% jump from the previous year. Over 1.6 billion quarters were distributed in 2024, down from 2.27 billion.
High-Cost Low Low-Value Half Dollars Surge While Paper Bills Remain More Efficient
The half-dollar coin is the most expensive coin to produce relative to its value, costing 33.97 cents—nearly two-thirds of its face value. Its production cost has surged over 30% since 2023. Interestingly, despite the steep cost, circulation has increased, with 52 million coins shipped in 2024 compared to 18 million the year before. This trend reflects a unique demand or operational decision by the Mint to circulate more of these coins despite their inefficiency.
In contrast to coins, U.S. paper currency is significantly more cost-effective to produce. The cost to print bills ranges from 3.2 cents for $1 and $2 notes to 9.4 cents for $100 bills. These costs are well below the face value of the notes, making them far more economical to produce. As coins become more expensive to make, the efficiency of paper currency highlights the growing economic argument for minimizing or restructuring U.S. coin production.
