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Last Updated: Jun 25th, 2007 - 17:07:26 |
By Rob Amen
Pittsburgh Tribune-Review
Sunday, January 29, 2006
Your two cents might be worth more than you think.
That's the case if you're holding pennies minted before 1982.
For just the second time since 1793, when the U.S. government
authorized the minting of one-cent coins, a penny is worth more than
one cent because the price of copper has skyrocketed to historic
highs. It barely eclipsed that threshold -- and only briefly -- in
the late 1980s.
But it has surged well beyond that recently, thanks in part to
strong demand from China, where manufacturers have been stockpiling
the metal before the Lunar New Year holiday, which begins today.
Today's pennies are copper-plated and mostly zinc. But from 1864 to
mid-1982, the coin was 95 percent copper and weighed 3.1 grams.
With copper selling for $2.23 a pound, a pre-1982 penny actually is
worth about 1.45 cents -- 45 percent above face value -- based on
its copper content.
Someone with a pile of pennies gathering dust in a jar could melt
them down and sell the copper for a tidy profit. It's perfectly
legal.
"If you have money, and it belongs to you, you can do pretty much
whatever you want with it," said Mike White, a spokesman for the
U.S. Mint.
But good luck finding a willing smelter.
"If someone had 500 one-cent pieces, and they're worth $7, they
probably can't do anything with them. If they knocked on a refinery
door, they would probably tell them to go away," said Dave Bowers of
Wolfeboro, N.H., a 1960 graduate of Penn State University who has
written 40 books on coins.
Asarco, a Tucson, Ariz., refining company specializing in copper,
does not melt down pennies, a spokeswoman said.
Several scrap-metal dealers in Pittsburgh said they don't melt
coins, either.
Doing so is only worthwhile when copper sells on the commodities
exchanges for at least $1.55 a pound, the threshold at which a pre-
1982 penny surpasses its face value. Copper has remained above that
price since July and peaked Dec. 27 at $2.28 a pound.
The only other time since 1900 that a penny crossed the $1.55
barrier was in December 1988 and the following month, according to
information provided by the New York Mercantile Exchange and Daniel
Edelstein, a copper commodity specialist with the U.S. Geological
Survey.
Copper's market price fluctuated then and eventually dropped below
$1.55 at the end of January 1989, according to NYMEX.
Twice before -- in 1857 and 1982 -- the rising price of copper
prompted the U.S. government to modify the penny's composition.
From 1795 to 1857, pennies were pure copper and weighed nearly 11
grams, Bowers said. The government made wholesale changes in 1857,
when it approved a smaller version weighing about 4.5 grams, he
said.
The 11-gram pennies, even at copper's 1900 price of about 16 cents a
pound, still would not have been worth more than one cent in their
day. Copper prices before 1900 were unavailable.
White said he was unsure how many pre-1982 pennies are in
circulation today.
The Mint does not recall coins, he said, although some are withdrawn
because they become damaged or worn.
The average life span for a coin is 30 years, White said.
"A penny has a different life span," he said. "They get sort of
parked in cookie jars and piggy banks."
Coinstar, a Bellevue, Wash.-based company whose machines count coins
in exchange for paper money, estimated that $10.5 billion in coins
sit idly in American homes at any given time.
That's about $99 per home, said George White, a Coinstar spokesman.
That makes for a whole lot of cents.
And, in a way, sense.
After all, a penny saved is more than a penny earned.
* * *
Copper is one of the oldest metals ever used and was an important
material in the development of human civilization.
It has become a major industrial metal, ranking third after iron and
aluminum in terms of quantities consumed.
It is a better conductor of heat and electricity than any other
metal except silver. Electrical applications such as power
transmission and generation, building wiring and telecommunications,
account for about three-quarters of total copper use.
Copper turns green when it reacts with atmospheric pollutants and
corrodes.
The Statute of Liberty contains 31 tons of copper.
Chile is the world's leading copper producer.
* * *
The weight and copper content of U.S. pennies have been reduced
since their introduction in the late 18th century.
1793-95: pure copper; weighs 13.48 grams.
1795-1857: pure copper; weighs 10.89 grams.
1857-64: 88 percent copper, 12 percent nickel; weighs 4.67 grams.
1864-1982: 95 percent copper; weighs 3.11 grams. (Most pennies
minted in 1943 were made of zinc-coated steel due to heavy demand
for copper during World War II.)
1982-present: 97.5 percent zinc, 2.5 percent copper; weighs 2.5
grams.
* Most pennies minted in 1943 were made of zinc-coated steel due to
heavy demand for copper during World War II.
At any given time, an estimated $10.5 billion in coins sit idly in
American homes and $110.8 million in Pittsburgh-area homes.
The U.S. Mint made more than 7.7 billion pennies in 2005.
Edmond Knowles of Flomaton, Ala., holds the record for most pennies
cashed in -- 1,308,459, worth $13,084.59.
According to a 2005 poll, 66 percent of Americans believe Congress
should keep the penny in circulation.
That same poll found that 79 percent of Americans would pick up a
penny off the ground.
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