Why a National Coin Shortage?

The U.S. Mint will produce a near record number of coins in 2020.  How is this possible? We have a coin shortage!   Even with all the business closures and restrictions, the economy may be overheating and demand for cash is very strong.  This directly contradicts that online and credit card use is at an all time high.  So can both be true; or is this a symptom of stimulus cash being spent quickly?  Here are some facts to consider.   

According to the U.S. Mint, in 2019 they produced 17 percent of the coins used in circulation.  In 2019, the Mint produced approximately 12 billion coins for circulation.  By referencing these figures, we can extrapolate the total 2019 coins in circulation at approximately 70 billion coins.   Due to the pandemic and online shopping, it is fair to say coin demand should be lower in 2020, but this does not seem to be the case.

For 2020, taking into account the number of coins already minted and statements from the Mint of  production goals for the remainder of the year, I estimate the Mint will produce over 15.5 billion coins in 2020.  This is about a 30 percent increase from 2019.   According to the Wall Street Journal, June 17, 2020, a Federal Reserve Spokesman stated that coin deposits by the public are down 50 percent.  Who wants to stand in line at a Bank to deposit coins?   Given these numbers, I estimate, the entire system is 10 to 15 percent short of the normal coin supply, hence the coin shortage.  

What does this mean for collectors?   Not many people think to save new coins, therefore,  even with huge mintage numbers uncirculated examples may be difficult to find in the future.  Currently, Philadelphia rolls have turned out to be difficult to find in uncirculated condition, particularly nickels.  Dimes may be the breakout coin of 2020 as they are also not easy to obtain.  2020 National park quarters are interesting.  Ironically, bats were featured on the first park quarters made for circulation in 2020.  Look for the special West Point quarter edition, with a “W” mint mark, mixed in with regular production rolls.   Half dollars, Innovation, and Native American dollars were only made for collectors in 2020, and not made for circulation.  If you have any coin questions, call 209-668-3682, and please feel free to mention this article.

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