The Treasury Department has said the production of (penny) one-cent coins will end in the US in 2026.
This announcement marks the phasing out of the coins, commonly known as pennies, which have been in circulation for more than 200 years.
The federal agency placed its final order for penny blanks this month, with the United States Mint slated to end manufacturing of the penny when that runs out.
President Donald Trump had told the Treasury Secretary, Scott Bessent, in February to stop minting the coins, which he said were wasteful, the BBC reported.
“For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!” Mr. Trump wrote in a February post on his Truth Social site. “I have instructed my Secretary of the US Treasury to stop producing new pennies.”
There has been a long debate over the cost and usefulness of pennies in the US.
In January, Elon Musk’s unofficial Department of Government Efficiency (Doge) drew attention to the cost of minting pennies in an X post.
The penny, which dates from the early days of the U.S. Mint after its establishment in 1792, now costs more to manufacture than the coin is worth. The 1-cent coin cost about 3.7 cents to manufacture and distribute in 2024, according to the U.S. Mint’s 2024 annual report.
Ending production of the penny will save the Mint about $56 million in annual savings, the Treasury said on Thursday. The Mint estimates that stopping production will save the Mint about $56 million in annual savings..
According to critics of the zinc and copper coin, producing it is a waste of money and resources, but those who want to keep it argue it keeps prices lower and boosts fund-raising for charities.
Despite their coppery look, pennies are mostly made of zinc, with their distinctive appearance coming from a copper overlay. Zinc’s cost per metric ton is more than double what it was in 2000, according to data from the Federal Reserve Bank of St. Louis.
According to the Wall Street Journal (WSJ), who first reported the story, the phasing out of the coins will mean businesses will need to round prices up or down.
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“Confirming the WSJ story, the Treasury has made its final order of penny blanks this month and the United States Mint will continue to manufacture pennies while an inventory of penny blanks exists,” a Treasury spokesperson was quoted by the BBC as saying.
Other countries have discontinued similar coins. Citing the cost of minting it and its falling purchasing power due to higher prices, Canada ditched its one-cent coin in 2012.
The declining use of cash meant the United Kingdom minted no new coins in 2024; this came after officials decided there were already enough coins circulating.
Although the UK Treasury has said that £1 or £2 coins were not being scrapped, with more people living cashless lives, there have been several years when the £2 coins were not produced.