The Michigan State Numismatic Society

  Coin-Sorting Machine Controversy?

By Diana Jellinek (Summer 2009 )

Coin-Sorting Machine Controversy?

By Diana Jellinek (Summer 2009 )

Do coin-sorting machines offer any benefit to coin collectors, or do they hurt our hobby? This article sets out to find the answers to those questions.

Automatic coin-sorting machines are conveniently placed in most major grocery stores. Why? The obvious answer is that they are helpful in sorting coins; they save time, for a small fee.

But hold your change - there is more. The not-so-obvious-answer is that these marvels of technology can harvest additional profits for their human masters beyond the percentile fee they charge – they can recognize the metallic make-up of a coin – not just the denomination – and sort accordingly.

This brings on the question: What do coin-sorting machine companies do with their copper, silver and gold finds? Answer: they sell them on the open market. And in some cases, they strike a deal with a mint and melt the metals down for more profit! The Asian Industrial Revolution is a prime driver of the modern metals game.

Those few collectors who may be tempted to utilize Coinstar machines probably already pre-sort their coins for collectible dates and high intrinsic value. But should they care what treasures non-collectors may be pouring into these machines?

Lawrence White, in “The Division of Labour,” wrote: “Pennies are copper-plated and mostly zinc, but from (mid-)1864 to mid-1982, the coin was 95 percent copper and weighed 3.1 grams. With copper selling for $2.23 a pound, a pre-1982 [US] penny actually is worth about 1.45 cents – 45 percent above face value – based on its copper content. […] But good luck finding a willing smelter. Sure, it doesn’t pay you or me to find a smelter for a single jar of pennies. But what about… (coin-sorting companies)? At what price of copper do they melt down the pennies they collect rather than return them into circulation?”

(Image from -- Ed)

Congress has placed a ban on the melting of U.S. 1-cent and 5-cent coins effective Dec. 15, 2006. Basically this made melting pennies and nickels illegal and is still in effect – so in the United States Coinstar couldn’t profit from sorting cents and nickels for the smelter. But could coins have been melted before that date? And since Coinstar has machines in Canada, Ireland, and the U.K., one might well wonder what the laws in those countries have to say about the melting of coins?

Sarah Ward Jones, public relations manager for Coinstar, declined comment whether they sort coins for higher intrinsic value.

But Erik Martin, editor of Coin World’s “Coin Values” magazine, partially answers the question: “Since 2004, the Royal Canadian Mint (has) melted old circulation coins in a deal struck with Coinstar. As consumers we should be aware of these issues.”

He adds, “From a collecting standpoint, there are possibly two ways to look at it: The pessimist will decry the destruction of existing pieces and the nullification of mintage records, but the optimist will say that (fewer) coins of a certain date may make their existing pieces more valuable.”

Others might point out that if Coinstar is sorting out better coins, they are only automating what collectors have been doing for many years by hand. If they are selling coins to the smelters and the collector market, they are just another player in the same old game we have all been playing. Perhaps some are just jealous that a corporation can do our job automatically and reap “easy” profits. It’s all a matter of perspective.

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Martin, E. (2009, March). "Nifty and Thrifty: Treasures from Your Pocket," Coin World’s Coin Values, 7, 38-39.

White, L. (2006, January 30) "Back to Commodity Money: The Pre-1982 Penny,".Division of Labour, Economics. Retrieved February 11, 2009, from .

Ward Jones, S. (2009, February, 11) Telephone conversation with Sarah Ward Jones, public relations manager for Coinstar.