How Rising Zinc And Copper Prices Are Causing The U.S. Mint To Lose Money When It Makes Money

As commodity prices rise, the U.S. Mint is in an interesting position.  Some of its currency is worth more as scrap than as money.

That's what I learned when reading about how coins are made.

For example, the composition of a penny is 97.5% zinc and 2.5% copper.  Because global demand for zinc and copper is rising, the cost to produce one penny is now greater than $0.01.

Same story for nickels. 

Nickel is element 28 in your periodic table and is the main "ingredient" in nickels, dimes, quarters and half-dollars.  In the case of making 5-cent pieces, today it costs about $0.055 to mint a coin that is worth $0.05.

If the U.S. Mint charts are accurate, we can estimate that between January 2006-June 2006, the U.S. government lost about $1,500,000 on minting pennies, and another $4,500,000 on minting nickels.

Source
Production Figures -- The United States Mint
The United States Mint
http://www.usmint.gov/about_the_mint/coin_production/index.cfm?action=production_figures&allCoinsYear=2006#starthere