Low copper price?

[My2Cents]

I had this thought the other day, and after reading through as many topics I could, I never did find anyone asking this question.

Assuming that the Fed lifts the ban on melting copper cents in the near future, wouldn't it stand to reason that the massive influx of copper from all us hoarders would actually drive down the price of copper at least to some noticeable level?

And if you really wanted to speculate, WHEN the lowly lincoln is finally pulled from circulation, don't you think that doing that would create an even lower price on copper since the mint makes billions of cents? While it's only a copper plated zinc, by eliminating the cent from production would actually lessen the demand for this industrial metal.

But I guess that if you're a long term holder, it doesn't really matter about the short-term impact on copper prices. I'll hoard until I'm dead and then my kids and grandkids can profit from what 'Grandpa' saved.

What's your opinion?

[thedrifter]

Naw,

It might drive down the market price of copper cents. (Which is already below melt), but it should not have any effect on the price of copper. I know there was a similar question asked awhile back about a year or more ago asd someone with a better grasp of the statistics explained it all.

[PADFH]

iirc, the amount of copper in pennies is not significant to global supply.

[ZenOps]

Assuming every person in the US has $9 in pennies = 280 billion pennies (copper and zinc), but lets just assume they are all copper.

280 billion x 3.11 grams ~ 960,000 tons.

Worldwide production of copper in 2011 = 16,100,000 tons.

So every penny ever made in the US, if melted down immediately - would still only constitute 1/16 of the worlds production in one year.

[My2Cents]

That's a good way of putting it. There might be a lower price on the regional scale if more people started melting down and recycling them, but the effects would be short lived like you point out. Good info

[Robarons]

Might see a short term blip psychologically and physically.

When investors hear about it they will freak out (not understanding the true math) typically with announcements and first rounds of copper pennies coming to market.

But numbers are insignificant and will have no bearing on price in the long run

[frugalcanuck]

We can also see this in practice this year when the Canadian Mint starts melting all the canadian coppers