NATIONWIDE – The official end of U.S. penny production, ordered by President Donald Trump due to the coin costing more to make than its face value (3.69 cents), is already causing localized currency shortages for retailers across the country.
The U.S. Mint reportedly produced its last pennies in August, following the Treasury Department’s final order for blanks in May. This abrupt discontinuation has led to immediate operational issues for businesses such as Kroger, Home Depot, and the convenience store chain Kwik Trip.
Retailers Forced to Round Down
Without a sufficient supply of one-cent coins, stores cannot provide exact change for cash transactions.
“It hit a lot sooner than anybody thought,” said Dave Niemi, public relations/training for Kwik Trip, noting the company is struggling to secure pennies. In affected locations, Kwik Trip is currently choosing to “round down to the nearest nickel,” resulting in a loss for the company but benefiting the customer.
Kroger has posted signs at some central Ohio locations asking shoppers to use exact change. A spokesperson for Kroger stated they are “assessing the impact” of the Treasury’s decision.
Industry Asks Congress to Intervene
The growing shortage has prompted major retail groups, including the National Retail Federation and the Retail Industry Leaders Association (RILA), to demand action from Congress.
These groups have sent a letter to congressional committees urging the passage of a national law allowing businesses to round cash transactions to the nearest nickel. They argue a federal law is necessary because at least 10 states prohibit such rounding.
“Retailers are growing concerned that the penny shortage will adversely impact operations as we enter the busiest stretch of the shopping season,” said Austen Jensen, RILA’s senior executive vice president.
The groups also warned that the lack of pennies could create complications for:
- SNAP Recipients: The benefit program prohibits rounding food prices, requiring immediate guidance from the Department of Agriculture to prevent non-compliance.
- Check Cashing Services: Retailers offering this service, often vital for low-income customers without bank accounts, may struggle to provide exact change.
Localized Supply Chain Issues
While approximately 250 billion pennies remain in circulation, experts blame “chaotic implementation” and “critical choke points” in the coin distribution system for the sudden shortages. About one-third of Federal Reserve coin terminals have reportedly stopped processing penny transactions, creating regional supply issues that disproportionately hurt low-income Americans and the businesses that serve them.
