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Why a Penny is Really Worth More Than 1 Cent - It's the Copper!

By Edited Nov 13, 2013 1 2

Copper Prices Have Increased...

I have read a couple stories on the internet recently of "Penny Hoarders" - people who have literally buckets and buckets of pennies in their garages. We're talking thousands of pennies. Are these people lunatics? Some might say so. It's confusing to many why people would want to be hoarding something that has so little value - after all, it's just pennies, right?

Wrong.

Some pennies out there are actually worth more than we think - more than 1 cent. The reason for this is simple - it's the copper, stupid!

"GET TO THE COPPER!" - Arnold

Copper prices have gone up considerably over the past 5 years or so, mainly because of inflation and industrial demand. Most metals and energy/resourceshave gone up in price, actually, including gold, silver, coal, oil, etc.

Not all pennies have the copper, though. There are only specific dated pennies you are going to want to look for. Here is what I'm talking about:

What's in a Penny?

So if you're even thinking of hoarding pennies, you have to look for those with copper - pennies pre-1982. They contained 95 percent copper and 5 percent zinc. Today's pennies contain 95 percent zinc, which is not worth anything really.

The pennies from 1793–1857 are 100% copper (If you can find these, hold onto them!)

So, how much are these pennies really worth? - "As of August 10, 2011 the metallurgical value of the copper in pre-1982 bronze and brass cents is 258% of their face value.[36] -  That means a 1 cent penny is really worth about .026 or close to 3 cents. Not bad.

"Post-1982 copper plated zinc cents have a metallurgical value of 56% of their face value."

You're going to need to collect a bunch of pennies, and patience, to make this quest even worthwhile, but apparently there are some who have done well. There are a number of places you can sell your pennies afterwards (numismatics or precious metals dealers, factories, etc.). I will have a follow up post on this so stay tuned.

Copper Prices - 5 Year Chart

Copper has gone from about $3/lb to super low price of $1.20 during the recession - straight back up to about $4.20/lb.

Copper Price Chart
Copper Chart

Copper is an industrial metal, like silver. Copper currently sells for about $3.40/lb. Copper prices fluctuate, but generally in a recession or deflation like we saw in 2008, the prices don't do well at all. However, in times of economic growth and inflation, copper is a solid performer. I am one who feels we are heading for big inflation this next decade, so I am actually pretty bullish on copper. China will definitely drive demand over the next 5-10 years.

What do you think about the idea hoarding pre-1982 copper pennies?


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Comments

Dec 24, 2011 2:40pm
GoldSilverInvestor
If saving pennies isn't your thing but you want exposure to copper... you can always buy the Global X Copper Miners ETF (COPX).
Jan 6, 2012 3:06pm
Goldenpig
I saw this article and had to read it. I mentioned a year ago or so to my mother that the older pennies were worth several times their face value due to the drastic price increase in spot copper. Sometimes when I head over to visit she is sorting her change looking for old pennies!

Shes been doing the same thing for years with dimes and quarters. Theres nothing like entering the front door and being asked to examine a handful of change for its silver content!
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