Final report

Weight 
(g) 
Metal + 
Fabrication 
+ USM 
Production 
– Scrap 
USM O/H + 
G&A + 
Distribution 
Total 
Unit 
Cost 
Savings vs. 
March 2012 
Cost for 
1403M 
Coins 
Savings vs. 
USM FY2011 
1403M Coins 
2011 Dime Coin (S) 
2.27 
$0.0357 
$0.0208 
$0.0565 
-­
-­
Dime March 2012 
Costs (S) 
2.27 
$0.0319 
$0.0208 
$0.0527 
-­
$5,271,219 
G6 Mod-Clad Cu (S) 
2.22 
$0.0292 
$0.0208 
$0.0501 
$3,774,068 
$9,045,287 
669z-Clad Cu (S) 
2.23 
$0.0291 
$0.0208 
$0.0500 
$3,893,837 
$9,165,056 
Unplated 31157­
Clad Cu (S) 
2.20 
$0.0277 
$0.0208 
$0.0485 
$5,923,437 
$11,194,656 
167  

Table 3-6. 
Quarter Dollar Coin Alternative Material Candidates Unit Costs 
Weight 
(g) 
Metal + 
Fabrication 
+ USM 
Production 
– Scrap 
USM O/H + 
G&A + 
Distribution 
Total 
Unit 
Cost 
Savings vs. 
March 2012 
Cost for 
323M Coins 
Savings vs. 
USM 
FY2011 
323M Coins 
2011 Quarter Dollar Coin (S) 
5.67 
$0.0828 
$0.0286 
$0.1114 
-­
-­
Quarter Dollar March 2012 
Costs (S) 
5.67 
$0.0720 
$0.0286 
$0.1006 
-­
$3,486,062 
G6 Mod-Clad Cu (S) 
5.55 
$0.0653 
$0.0286 
$0.0939 
$2,172,174 
$5,658,236 
669z-Clad Cu (S) 
5.59 
$0.0651 
$0.0286 
$0.0937 
$2,241,107 
$5,727,170 
Unplated 31157-Clad Cu (S) 
5.51 
$0.0614 
$0.0286 
$0.0901 
$3,409,248 
$6,895,311 
Ni-Plated-31157-Clad Cu (P) 
5.26 
$0.0774 
$0.0286 
$0.1060 
$(1,741,862) 
$1,744,200 
Nickel-Plated Steel (P) 
5.03 
$0.0521 
$0.0286 
$0.0807 
$6,415,847 
$9,901,910 
Multi-Ply-Plated Steel (P) 
5.03 
$0.0434 
$0.0286 
$0.0720 
$9,240,138 
$12,726,200 
Dura-White-Plated Zn (P) 
4.54 
$0.0393 
$0.0286 
$0.0679 
$10,564,438 
$14,050,500 
SS/Cu/SS (S) 
5.56 
$0.0584 
$0.0286 
$0.0870 
$4,380,423 
$7,866,485 
SS = stainless steel 
3.13.2  Alter native Clad Copper 
The three copper alloy alternative material candidates offered by Olin (G6 mod), PMX (669z) and 
JZP (31157 [nickel plated and unplated]) for the 5-cent coin are also suitable seamless options as 
clad layers over a copper core for the dime and quarter dollar coins.  These candidates provide 
coins that are similar in weight and EMS to the incumbent coins, albeit with modest cost savings.  
The cost savings for a candidate with an equivalent EMS to the incumbent dime and quarter 
dollar coins is limited.  There is no lower-cost alternative material to copper that approaches its 
electrical conductivity; therefore, a copper core must be retained to maintain the same EMS as 
incumbent dime and quarter dollar coins. 
As with the 5-cent coin, G6 mod and 669z have a slight yellow cast, whereas unplated 31157 is 
more of a golden hue.  For the quarter dollar coin in particular, the use of unplated 31157 may 
result in some confusion with the golden dollar coin, although the golden dollar coin is not widely 
used in transactions.  The starting stock for these coins would be delivered as coiled sheet with 
presumably equivalent processing to the incumbent cupronickel-clad coins.  These copper alloy 
alternative material candidates could be recycled in the same manner as the incumbent clad coins: 
scrap coins and/or web scrap can be melted and additional elements added to obtain the desired 
material composition for the clad layer alloy on future coins.  Because the copper core remains 
and the clad comprises about 33% of the coin thickness, less cost savings are possible for the 
quarter dollar coin than for the 5-cent coin.  The total cost savings for the alternative copper-clad 
quarter dollar coins range from 7–10%, based on March 2012 metal cost, depending upon the 
outer-clad copper alloy selected. 
As with the 5-cent coin, JZP has also proposed a nickel-plated version of 31157 as an RTS 
quarter dollar planchet, although this option appears to provide no significant cost benefit from 
incumbent coin material construction. 
168  

3.13.3  Dur a-White-Plated Zinc 
As described above for the 5-cent coin, Dura-White-plated zinc quarter dollar coins would be 
produced from RTS planchets; resulting in significant cost reductions primarily from the 
replacement of the incumbent copper core with a zinc core.  This coin would have a unique EMS; 
although different from the incumbent quarter dollar coin; a Dura-White-plated zinc quarter dollar 
coin would require significant conversion costs to several stakeholders as discussed in the 
Outreach Chapter.  The material costs were calculated from a JZP quotation.  Dura-White-plated 
zinc is the lowest cost alternative material candidate for the quarter dollar coin with an 
approximate 33% total cost savings over the incumbent quarter dollar coin, using March 2012 
metal costs.  The weight of the coin would be approximately 20% lighter than the incumbent 
quarter dollar coin.  When co-circulated as a non-seamless coin with incumbent coins, this would 
necessitate changes to the procedures used and costs required to validate large quantities of these 
coins by coin-processing equipment. 
3.13.4  Multi-Ply-Plated Steel 
The Multi-Ply-plated-steel coin costs were calculated from a JZP quotation.  This alternative 
material candidate has a unique EMS, which is different than that of the incumbent quarter dollar 
coin.  Therefore, many stakeholders would be required to endure conversion costs to upgrade 
coin-processing equipment.  The uniqueness of the associated EMS is a result of the copper-
plated layer thickness.  Since Multi-Ply technology is licensed and sold by the RCM, the RCM 
will be instrumental in ensuring that US Multi-Ply-plated quarter dollar coin has an EMS 
distinguishable from all other Multi-Ply-plated steel coins used around the world.  As a result of 
the difference in density between steel and cupronickel, Multi-Ply-plated steel quarter dollar coins 
would weigh only 89% of the incumbent quarter dollar coins.  Changes would be required to the 
procedures used and costs required to handle large sums of Multi-Ply-plated coins that are co-
circulated with incumbent coins.  More details may be found in the Outreach Chapter. 
3.13.5  Stainless Steel-Clad Copper 
During its preliminary investigation of alloys, CTC speculated that an inexpensive non-
ferromagnetic stainless steel-clad copper coin may offer a less costly and seamless alternative 
coin construction.  A supplier of such material was not found; therefore, a simple experiment 
consisting of gluing stainless steel to C110 was completed for limited analysis.  Preliminary test 
results, which included electrical conductivity measurements, have shown that this coin 
construction is a potentially seamless option for the cupronickel-clad coinage.  Potential seamless 
being that this construction would mimic the EMS of the incumbent quarter-dollar coin.  Due to 
differences in densities of these materials, a weight difference between cupronickel- and stainless 
steel-clad quarter dollar coins would require those who use coin weight to verify coin count to 
modify their current procedures. 
3.14 
DOLLAR COIN 
3.14.1  Manganese-Br ass-Clad Copper 
The dollar coin starting stock is delivered to the United States Mint as a manganese-brass-clad 
copper coiled strip; it is the only denomination that currently goes through a separate burnishing 
step.  The cost components of the dollar coin are shown in Figure 3-9.  The dollar coin is also the 
only US denomination that has edge lettering for additional security.  In addition to metal cost 
169  

savings, an alternative material for the dollar coin should have improved tarnish resistance and the 
possible elimination of the burnishing step to further reduce the fabrication costs of the coin.  
Table 3-7 shows the cost elements of several alternative material candidates for the dollar coin. 
Metal 
Fabrication 
Production 
O/H 
Dist. To FRB 
G&A 
42% 
20%
6% 
17% 
1% 
14% 
Figure 3-9. 
Cost components of the dollar coin (FY2011). 
Table 3-7. 
Dollar Coin Alternative Material Candidates Unit Costs 
Weight 
(g) 
Metal + 
Fabrication 
+ USM 
Production 
– Scrap 
USM O/H + 
G&A + 
Distribution 
Total 
Unit 
Cost 
Savings vs. 
March 
2012 Cost 
for 467M 
Coins 
Savings 
vs. USM 
FY2011 
467M 
coins 
2011 Dollar Coin (S) 
8.10 
$0.1231 
$0.0572 
$0.1803 
-­
-­
Dollar Coin March 2012 
Costs (S) 
8.10 
$0.1124 
$0.0572 
$0.1696 
-­
$5,018,535 
C69250-Clad Cu (S) 
7.91 
$0.1112 
$0.0572 
$0.1683 
$593,622 
$5,590,522 
K474-Clad Cu (S) 
7.74 
$0.1078 
$0.0572 
$0.1650 
$2,154,460 
$7,151,360 
Yellow-Bronze (88Cu-12Sn) 
-Plated Zn (P) 
8.46 
$0.1076 
$0.0572 
$0.1648 
$2,241,600 
$7,238,500 
3.14.2  Alter native Clad Copper 
Clad-copper candidates C69250 and K474 from Olin are relatively seamless with respect to 
production of the incumbent dollar coin; these two alloys also have lower costs using March 2012 
metal costs, through less-expensive alloying additions.  These materials have compositions that 
are proprietary to Olin.  The composition change from the incumbent clad alloy for the dollar 
coin, which contains 77Cu-12Zn-4Ni-7Mn, limits material selections when considering a golden-
colored alloy that matches the EMS of the incumbent dollar coin.  Both of these alternative 
material candidates result in coins of similar density to the incumbent dollar coin.  Unfortunately 
there is only a minimal cost savings associated with these alloys and the tarnish resistance has not 
been shown to be superior to that of the incumbent materials of construction (see Testing Program 
Chapter for more information). 
3.14.3  Br onze-Plated Zinc 
The metal costs were calculated from London Metal Exchange (LME) March 2012 commodity 
prices for the yellow-bronze-(88Cu-12Sn) plated zinc candidate.  The fabrication and production 
costs were calculated by weight ratio from the Dura-White and the production cost at the United 
States Mint; these values were adjusted to reflect only striking at the United States Mint.  This 
170  

material is proprietary to JZP and would be delivered as a RTS planchet to the United States 
Mint.  It has a unique EMS, which is different from the incumbent dollar coin.  Consequently, 
conversion costs would be incurred by stakeholders to recognize, validate and accept coins made 
of yellow-bronze-plated zinc.  Since the tarnish performance (see Testing Program Chapter) and 
the cost of these materials of construction is approximately the same as those for the incumbent 
dollar coin, a non-seamless co-circulation model for dollar coins minted from these materials 
would not be advised. 
3.15 
CONCLUSIONS 
̄ CHAPTER 3 
̄ 
The following provides a summary of the state of metals pricing, production costs and cost factors 
inherent for each denomination of the incumbent US circulating coinage and for each of the 
alternative material candidates evaluated in this study. 
For the most part, all industrial metals have exhibited a similar general cost trend in the 
commodities market that reflects overall global economic trends.  In 2006–2007, prices peaked 
for many metals after a steep run-up and then dropped quickly from mid-2007 through 2009. 
Today, prices have moderated and seem to be slowly increasing, although it is difficult to predict 
long-term pricing trends amongst short-term volatility.  Nevertheless, there has been a fairly 
predictable trend in that the sequence in cost of metals does not seem to change and has been, 
from more to less costly in this order:  nickel, copper, aluminum and zinc, and steel.  Exploiting 
the low costs of steel, zinc and aluminum, while employing copper when necessary for EMS, was 
emphasized in the Alternative Metals Study for coinage material candidates.  Use of steel, 
stainless steel and/or aluminum in coinage would likely necessitate the introduction of one or 
more new material suppliers to the United States Mint.  If these alternative materials are chosen 
for future coins, then the supplier base may have to be expanded. 
$$$$ Ni > $$$ Cu > $$ Al, Zn > $ steel 
It is important to note that as of March 1, 2012, the cost of incumbent circulating coinage is 
significantly less than the average FY2011 cost due to reduced commodity metal prices.  This is 
not necessarily indicative of future costs, but illustrates the volatility in metals pricing. 
There are three major components of the cost equation for coins that can be affected by a change 
to its composition.  These are the cost of the metal, the supplier fabrication costs of the coin 
starting stock and the United States Mint direct production costs.  The other components, 
including the United States Mint production overhead, distribution to the Federal Reserve Banks 
and G&A are essentially fixed (for purposes of this study) and are calculated based upon a 
formula that assigns the total plant cost by activity and denomination. 
Alternative material candidates studied would be supplied as either coiled strip or as RTS 
planchets.  Plated coins are typically delivered as RTS planchets since the edges of the blank need 
to be plated.  Monolithic or clad materials would be delivered as either coiled strip or RTS 
planchets.  However, if production steps, such as blanking, annealing or upsetting, are eliminated 
only the direct portion of the costs associated with these steps could be saved from the overall 
costs to operate the United States Mint facilities since factors such as plant overhead must still be 
accounted for.  Given these facts, CTC has estimated that monolithic and clad coins are lower in 
cost if their starting stock is delivered to the United States Mint as coiled strip rather than as RTS 
171  

planchets.  Planchet production would increase supplier fabrication costs, which would be passed 
onto the United States Mint; however, a concomitant decrease in the total United States Mint 
costs may not be realized, regardless if the supplier is more efficient or lower cost than the United 
States Mint. 
Under the current practice of allocating indirect expenses at the individual product level, in 
FY2011 the United States Mint’s indirect costs allocated to the one-cent coin were greater than 
$0.01 per unit.  Positive seigniorage for the one-cent coin is impossible without a change in cost 
reporting or fundamental alteration of the United States Mint’s fixed-cost structure.  Metal, 
supplier fabrication and United States Mint direct production costs are over $0.01 using March 
2012 metal prices.  Zinc comprises 97.5% of the incumbent one-cent coin; zinc is one of the 
lowest-cost metals suitable for coin production.  Zinc-based coins offer little opportunity for 
reduced costs by alternative metals.  Zinc and carbon-steel are both low-cost materials and both 
require a coating to prevent corrosion during circulation.  Both materials are used in many 
countries with a copper plating.  Copper-plated zinc (CPZ) and copper-plated steel (CPS) coins 
are nearly identical in total cost to produce.  As of March 2012, CPZ is slightly lower in cost than 
CPS as current CPS production requires a greater copper plating thickness and more costly 
processing (including annealing).  Material costs for the one-cent coin could be lower by using a 
monolithic material that does not require plating.  Aluminum alloy 5052-H32 was the lowest 
candidate material cost option evaluated.  Earlier studies for the Department of the Treasury also 
concluded that aluminum alloys should be considered for use as one-cent coins; citing that the 
public would get used to a lighter, silver-white one-cent coin.  However, the coin-processing 
equipment industry considers an aluminum alloy one-cent coin unsuitable as its light weight tends 
to jam machines and disrupt service resulting in significant repair costs.  Future developments that 
could result in lower one-cent coin material costs include the elimination of the anneal step of 
CPS, thinner CPS plating and softer stainless steels that would provide longer die life. 
For the remaining coins, there are two types of alternative material candidates presented for each 
denomination:  1) potentially seamless candidates having approximately the same EMS and 
weight as the incumbent coin and 2) non-seamless (co-circulate) alternative candidates having a 
different, albeit unique, EMS and/or a different weight from the incumbent coin.  The seamless 
alternative material candidates provide for a modest cost savings, whereas the non-seamless 
alternative material candidates result in larger cost savings to the United States Mint.  Use of non-
seamless alternative material candidates may result in significant conversion costs to upgrade 
coin-processing equipment. 
For the 5-cent coin, the allocated indirect United States Mint costs for FY2011 totaled $0.0322 
per unit and so obtaining positive seigniorage is very challenging.  Several alternative material 
candidates offer significantly reduced costs over the incumbent 5-cent coin.  The seamless 
alternative copper alloy candidates provide up to a 35% total unit cost reduction compared to the 
FY2011 cost of the incumbent 5-cent coin (27% vs. March 2012 total unit costs).  These 
alternative copper alloys would also be annealed at a lower temperature than the incumbent 
cupronickel material.  These copper alloys are produced by the current United States Mint 
suppliers and utilize the same processing steps as cupronickel.  As tested in this study, Alloys G6 
mod, unplated 31157 and 669z were found to have densities within 9% and a similar EMS as the 
cupronickel material, as discussed in the Outreach Chapter.  The G6 and 669z alloys have a slight 
yellow cast whereas the unplated 31157 has a golden hue color.  Alloys G6 mod and 669z 
172  

displayed similar wear and corrosion performance as the cupronickel material.  Surface oxidation 
of the G6 mod and 669z darken toward golden hue while cupronickel oxidation darkens 
somewhat brown. 
The range of elements comprised by the copper alloys (including copper, zinc, nickel, manganese 
and iron) are wide; additional development is required to optimize composition, EMS and color to 
mint a seamless 5-cent coin.  No reliable method was discovered that predicts the EMS and color 
of multi-component copper alloys prior to producing and evaluating heats of a new alloy.  To 
ensure an even closer match to incumbent coins, several more variants of these alloys could be 
produced and tested.  These developments could also focus on narrowing the range of elements 
specified for G6 mod, 669z and unplated 31157; the optimized composition may lie somewhere in 
between these alloys.  Note that even if the copper alloys were seamless with regard to 
dimensions and EMS, the weight of the alternative coin will likely be lower than the incumbent 
coin.  The cost associated with the impact of this weight difference is discussed in the Outreach 
Chapter. 
For the non-seamless alternative material candidates, stainless steel provides an interesting low-
cost, silver-white choice for the 5-cent coin.  Grade 430 stainless steel has the lowest material 
cost; however, it requires high striking loads and is ferromagnetic, which would not allow 
identification by a significant number of coin-processing equipment sensors.  Non-ferromagnetic 
302HQ stainless steel is a better candidate as it requires lower coining loads and is not drawn to a 
magnet.  Stainless steel alloys require higher striking loads and to alleviate problems with higher 
striking loads (and therefore shorter die life); lower relief designs may have to be implemented if 
stainless steel coins are minted.  Development of a stainless steel alloy specifically designed for 
coinage should be considered.  Plated 5-cent coin candidates would have a unique EMS, but 
would not match that of the incumbent 5-cent coin; creating co-circulation concerns with a non-
seamless coin.  The different EMS would require reprogramming and/or hardware upgrades to 
coin-processing equipment.  The associated conversion costs to those who own the coin-
processing equipment would be significantly larger than the cost savings that would be realized 
by the United States Mint for the plated 5-cent coin alternative material candidates evaluated in 
this study. 
The seamless alternative material candidates for the quarter dollar coin utilize the alternative 
copper alloys as clad layers on copper.  Using March 2012 material costs, G6 mod- or 669z-clad 
copper provides an approximate 13% material costs savings (16% total unit costs for FY2011) for 
the incumbent quarter dollar coin, while providing seamless circulation with incumbent quarter 
dollar coins.  These seamless candidate options retain the copper core; therefore, coin weight is 
within 3% of the incumbent quarter dollar coin.  Unplated 31157-clad copper provides additional 
material savings, although the golden hue color may cause public confusion with the similarly 
sized golden dollar coin, although the dollar coin is not widely used in transactions.  G6 mod- and 
669z-clad copper have a slight yellow cast color as the monolithic alternative copper alloys for 
the 5-cent coin. 
The plated alternative material candidates provide greater cost savings, although some further 
assurances are needed to ensure that plating thickness is consistent and wear of these coins will 
not pose security or appearance issues.  Development of a stainless steel-clad copper may provide 
an EMS match to the incumbent cupronickel-clad copper quarter dollar coin.  At this stage of 
173  

development, the possible cost savings for a stainless steel-clad copper construction is unclear; 
material is not commercially available in the quantities required. 
Alternative material candidates for the dollar coin were limited to material options that could be 
seamless with production and coin-processing equipment, while improving tarnish resistance over 
the incumbent coin materials of construction.  Unfortunately, none of the candidates selected 
displayed any marked improvement in tarnish resistance.  Furthermore, none of these candidate 
materials were found to be seamless alternatives to the incumbent materials of construction for 
the dollar coin.