Despite lower production expenses, pennies and nickels still cost more to make than their face value — and that added up to a loss of $90.5 million to taxpayers this year, according to a new Treasury Department report.
A penny cost the U.S. Mint 1.7 cents to produce in the fiscal year that ended Sept. 30, down from 2.4 cents in 2011 largely due to lower prices for copper.
The price of making a nickel dropped to 8.1 cents from 11.2 cents during the same period, according to a biennial report required by a 2010 law designed to modernize U.S. coin production.
“We’ve achieved significant savings by delivering robust cost reduction initiatives across the full spectrum of operations,” said Richard Peterson, the Mint’s deputy director.
It was the ninth straight year the costs to produce pennies and nickels were above the coins’ face value, according to the report. The Treasury lost a combined $90.5 million on production of those coins in 2014, an improvement from $104.5 million lost in 2013.
Production costs for dimes and quarters also dropped significantly.
A dime cost 3.9 cents to make in the 2014 fiscal year, down from 5.6 cents in 2011. The cost of producing a quarter fell to 9 cents from 11.1 cents in the same period.
The 2010 law required the Treasury secretary, who oversees the Mint, to research alternative metal combinations to try to reduce coin production costs.
The Mint has been conducting tests, although the new report concluded, “There are no alternative metal compositions that reduce the manufacturing unit cost of the penny below its face value.”