RETAILERS START TO SEE PENNY SHORTAGES THE FEDERAL RESERVE PUBLISHED FAQS ADDRESSING DISTRIBUTION ISSUES.

The following information was released by the National Association of Convenience Stores (NACS):

In early 2025, President Trump ordered the Treasury to end the production of the penny, arguing that the coins cost more to produce than their value and waste taxpayer money.

The Wall Street Journal reported in May that the Treasury Department would stop putting new pennies into circulation by early 2026. However, that appears to have happened much sooner. The final minting of pennies happened in June, and the Federal Reserve, which distributes the coins, made its last shipment to its coin distribution locations in August. While existing pennies will remain legal tender and continue circulating, supply shortages are beginning to emerge and areexpected to increase.

NACS has raised industry concerns with Congress and the Administration and is advocating for federal legislation to permit the rounding of cash transactions, said Anna Ready Blom, strategic advisor of government relations team at NACS.

This week, the Federal Reserve published a list of frequently asked questions about penny deposits and orders. In its communication, the Fed included a list of coin distribution locations that have ceased fulfilling penny orders as inventory is depleted.

Coins are produced by the U.S. Mint and distributed by the Fed to banks and credit unions. In turn, these financial institutions provide coins directly to individuals and businesses. The Federal Reserve does not provide coins directly to businesses or consumers.

The Fed is analyzing penny inventory on a weekly basis. When inventory at a specific location is depleted, FedCash Services will cease fulfilling orders of pennies at that specific location. For deposits, as localized inventory is depleted, it will vary over time whether coin distribution locations are able to accept deposits.

Without the production of new pennies, cash transactions would need to be rounded to the nearest nickel. There are some states and localities with cash laws that would prohibit this type of rounding. NACS has been advocating Congress and the Administration to resolve the issue.

NACS will continue to monitor the situation. Look out for more updates as they become available.