Mighty Bargain Hunter

Copper cents will probably get very scarce, very soon

December 14th, 2007 | by mbhunter |

One hundred million pennies made their way to the for the Penny Harvest Field in New York City’s Rockefeller Center, a display covering nearly 5,000 square feet to a depth of over two feet. Behind the Penny Harvest is Common Cents, which “nurtures a new generation of caring and capable young people between
the ages of four and 24 by enabling them to strengthen their
communities through philanthropy and service-learning,” (from its mission statement).

The display contains a little less than one tenth of one percent of all pennies in circulation. Definitely more than one hundredth of one percent; only about 300 billion pennies have been minted in total.

In the commodities markets, copper and zinc have taken a beating over the past couple of months, but a pre-1982 95% copper cent is still worth almost twice its face value in metal content. (A 97.5% zinc cent was worth more than its face value, but now it’s dropped to about 60% of face value.) Even though it’s now illegal to melt pennies for their metal content (or export them in any appreciable quantities), the disparity between the face value and the intrinsic metal value remains.

The only real difference between the copper pennies and the zinc pennies is their mass, and it’s not a big difference: 3.1 grams vs. 2.5 grams. Otherwise, they’re the same size and are both non-magnetic. So without anything else to help you except a magnifying glass and a light, you’re sorting them by hand if you want to accumulate the copper ones.

But now there is something else to help. It costs about $650 and it is capable of sorting about 300 coins per minute. A video is here. The machine works, and it’s automatic and accurate. If some guy bought ten of these machines and had help to run them twelve hours a day, it would take less than two months to sort out all of the copper pennies in the Penny Harvest Field.

What a great opportunity for the Mint to pull a whole lot of valuable copper cents out of circulation. What a great opportunity for Coinstar to become a commodities dealer. What a great opportunity for hobbyists to provide a service for copper accumulators. It’s already happening. Auctions for cents in the years 1959-1981 (not even wheat pennies) are getting bids above face value.

One seller on eBay is selling off part of his 15,000 rolls of copper cents. He said that he has to go through about $125 to $140 worth of pennies to get $25 of copper pennies, so his yield is only about 15% or 20% now. They’re getting relatively hard to come by.

All of this really matters only if you care — which you might not, and that’s fine — but if you’re interested in making a few bucks on your loose change, start pulling out the pre-1982 cents now if you haven’t already. I’m probably not going to buy boxes of sorted cents, mainly because my wife would shoot me and also because you have to have a lot of room to dedicate to storing these coins (this is roughly what that one seller’s collection looked like). If copper takes a move up (like to $10/pound) he could probably sell his $7,500 collection easily for over $30,000. At that price, even $5.00 in copper cents becomes profitable to sell on eBay, including shipping expenses. If the Mint removes the melt ban (as it has done in the past) then the copper cents will fly out of circulation, guaranteed.

Get ‘em while you can for a penny each!