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A New Law Makes it Illegal to Melt Down Pennies and Nickels

By December 14, 2006

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The U.S. Mint has announced that a new regulation, effective immediately, makes it illegal to melt down U.S. Cent and Nickel coins. Due to sharply rising metal prices, the U.S. Cent (99.2% zinc and 0.8% copper core, plated with 100% copper) has a current melt value of 1.12 cents per coin. The nickel, (75% copper and 25% nickel) has a melt value of a hefty 6.99 cents per coin!

Important Features of the New Regulation:
  • Travelers leaving the U.S. are limited to taking $5.00 worth of pennies and nickels out of the country.


  • No more than $100.00 worth of pennies and nickels can be shipped out of the U.S. in any one shipment, and those only for "legitimate coinage and numismatic purposes."


  • Penalties for violation include fines up to $10,000 and 5 years in prison, plus forfeiture of the melted, shipped, or treated material.


  • The new law will have Interim Regulation status for 120 days, during which comments will be accepted for 30 days. Following the comment period, a decision will be made by Mint Director Ed Moy as to whether the law should become permanent.
This regulation is very similar to laws that were in effect during previous metals price surges, including the silver coin melting ban of 1967 - 1969 and the penny melting ban of 1974 - 1978. For further information about the new regulation, and to learn how to make comments regarding it, read the U.S. Mint Press Release.

I can't help but wonder if we're going to see a new metallic composition for the nickel soon. Another thought that comes to mind is whether we'll see nickel hoarding. What are your thoughts about this? What metal might we see in a new nickel? Are you going to start hoarding your pennies and nickels now? Share your thoughts in the Comments (below) or come discuss them with us in our Coin Collecting Forum.

Comments

December 25, 2006 at 5:59 pm
(1) jeff says:

I have been sorting my pocket change for years obviously the silver 90% or 40% but recently I have been putting the pre-1982 pennies in a can(s) It may now be illegal melt the coins but if my house burns and the fire gets hot enough I can not only ca$h in on the insurance but also have several hunks of precious metals to ca$h in on. I have been buying as much silver bullion as I can get my hands on. It should skyrocket in 2007 so buy now !!!!

January 24, 2007 at 11:58 pm
(2) Drew says:

I have been a member of hoardingcopper.com for about a year now but have been hoarding US copper pennies and US zinc pennies for about two years. I have amassed about 150,000 pennies in total. I also hoard Canadian pre 1981 nickels which are 99.5% nickel unlike our US nickels which are only 25% nickel and 75% copper. Also Canadian cents pre 1996 are 98% copper and make a great investment.

February 1, 2007 at 9:33 pm
(3) Starphi says:

Forget the pennies and start purchasing nickels at $100 a box at your local bank! These boxes contain 16.5 lbs. of copper and 4.5 lbs. of nickel … metals which are destined to skyrocket due to the China metal shortage syndrome.

February 1, 2007 at 9:46 pm
(4) Starphi says:

To correct the above comment … a two thousand count box of nickels worth $100.00, weighs a total of 22lbs. which is 16.5 lbs of copper and 5.5 lbs of nickel.

January 21, 2008 at 5:00 pm
(5) kevin says:

wow i dont think its going to stop people from forging(melting pennies)with pennies or nikles
i dont think it should be permement

March 15, 2008 at 1:46 am
(6) ryan says:

I dont know about you but i’m going to start melting pennies and nickels inmediately!!!!!!!!!

November 4, 2008 at 7:47 pm
(7) mike says:

Scrap prices are dropping !!!
time 2 SToCK UP !!!!!!!!

June 5, 2009 at 11:43 pm
(8) Kevin says:

First, as I understand it, circulating coins belong to the public, and as such can be melted, used in arts and crafts projects, mailed overseas, or eaten for that matter.

Second, Congress has a lot of nerve telling us we can’t melt our own coins, when they just “removed” 8 trillion dollars from us at gunpoint and handed the money to their buddies at the big banks and big unions. They should be wearing stripes, not telling US what we can and can’t do with what little money we are left with after the mugging from them!

April 5, 2010 at 9:48 am
(9) M says:

what do you think there going to do with it. Its our money to do with what we want. We worked for it we saved it not them Its called profit. these people want to make sure they get all our profits and now a co2 tax( they are going to tax the air u breath and Im sure there laughing about it)!!

November 18, 2010 at 12:40 am
(10) Justin says:

Thank you so much for your comment Kevin(8). You totally hit the nail right on the head. Frankly, I wish I knew your full name just so I could friend you elsewhere online.

It is disgusting that our government(which we own) thinks they can get away with such bullying. Although I can always play devils advocate and say currency belonsg to the “general public” and not necessarily to any one particular person that might decide to melt the ones they have in their possession.

I still completely agree with your argument. If you happen to stop back I hope you click my name to my blog and shoot me an e-mail. I needed that perspective after reading this article.

In addition I will also say I think a change in metal content of the nickel is imminent considering the expense of manufacturing negates production at this point.

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