Canadian penny proves too costly
Costing more to make than its worth, the Canadian penny's price was just too high.
Photo: Kayla Chobotiuk
Despite reaching a production peak of nearly 1.3 billion in 2006, a 2007 survey showed only 37% of Canadian used pennies.(Photo: Kayla Chobotiuk)
The Canadian one-cent piece, commonly known as the penny, was born in 1858. Minted alongside five-, 10- and 20-cent pieces, it was among the first series of coins produced by the then-province of Canada, which for years had fought to distance itself from the sterling monetary system in use throughout the British empire. A decimal system was adopted to put Canada's currency in line with the U.S. dollar.
The first penny was composed of nearly 100% copper. The original coin's L. C. Wyon design-with a bust of Queen Victoria, the reigning British monarch, on one side, and an arrangement of maple leaves on the reverse-was not radically different from today's penny. The maple leaf twig designed by G. E. Kruger-Gray on the current penny was introduced in1937, and has appeared every year since, with the exception of 1967, when it was replaced with a rock dove designed by artist Alex Colville as part of a centennial series of coins.
The penny's cost has been an issue nearly since the year it was first produced. Due to its lack of physical heft, the first Canadian penny proved so unpopular that by 1859 the coin was being sold at a 20% discount to encourage consumers to circulate them, and was not minted again until 1876.
In 1920, the increasing price of copper forced a decrease in the penny's size from roughly that of today's quarter to its current familiar form. Copper prices were responsible for another major change in 1997,when the penny's composition was switched to 98.4%zinc with a copper plating. Three years later it was changed again, to its current composition of94% steel, 1.5% nickel and an increased copper plating of 4.5%.
As its buying power lessened with time (a penny in 1858 could buy a loaf of bread), Canadians became reluctant to carry pennies, hoarding them in jars and leaving them in convenience store take-a-penny trays. With those pennies effectively out of circulation, the Royal Canadian Mint was forced to produce an average25 pennies per Canadian per year. Despite reaching a production peak of nearly 1.3 billion in2006, a 2007 survey showed only37% of Canadian used pennies.
While delivering his federal budget on March 29, Finance Minister Jim Flaherty announced production of the penny would end this month.
In the end, the penny was collateral damage in the battle of inflation, its manufacturing cost rising to 1.6¢. In a world where even penny candy now costs more than a nickel, the copper coin became a nuisance. The Mint refused to grant the coin the dignity of becoming a low circulated collectible like its cousin the half-dollar and announced it will begin withdrawing them from circulation in the fall, though the one-cent piece will remain legal tender and retain its value indefinitely.
The penny is survived by the quarter, dime and nickel, though rumours already have begun to circulate that the latter's days may be numbered as well.
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