In determining a coin’s rarity, numismatists often rely upon mintage figures. After all, logic dictates that the smaller the original quantity made, the smaller the pool of survivors today. However this tells just half the story. Over the past 150+ years, enormous quantities of American coins have been melted for various reasons. Whether it was because of wars, spiking bullion prices or coinage surpluses, vast amounts of coins were eventually destroyed. This article will describe why these mass melting took place and which coins were most affected by them.
When the Civil War broke out in 1861, precious metals rapidly spiked in value. Even copper saw an instantaneous and dramatic price increase. Suddenly most American coins were worth more “dead” than alive; their melt values exceeded their face values. In the ensuing several years, tremendous amounts of American gold and silver coinage was melted and/or exported. This is one of the primary reasons why antebellum American coinage is significantly more rare than issues made after the Civil War.
A second melting spree took place in 1933, when President Franklin D. Roosevelt issued an emergency order prohibiting the private ownership of gold. Not only did the general public exchange vast sums of coin coinage for paper money, but also unreleased quantities of US gold coins were sent to the melting pot. For this reason, many $20 Saint Gaudens Double Eagles stuck in the 1920s and 1930s are extremely rare despite having lofty mintages. As an example, the 1927-D has a total mintage of 180,000 pieces but fewer than 20 can be accounted for today.
In 1965, due to rising silver prices, the composition of American dimes, quarters and half dollars was completely reformulated. Previously, these denominations were made of 90% silver, but the new formula was a mix of copper and nickel. The price of silver gradually continued to escalate and these 90% silver coins became worth substantially more than face value. For many years these coins were melted to recover their silver content, but now 90% silver coins are worth a premium over melt value. Within the past 5-10 years these 90% silver coins traded for a small discount to melt, but in active bullion markets, they can command 10-30% premiums.
Today, numismatists have more than anecdotal evidence as to which coins were most heavily melted. Thanks to the advent of PCGS and NGC population reports, it is now possible to determine how many coins of a given issue were graded relative to their original mintage. After 30 years of data collection, these population census reports provide excellent guidance as to how many coins have actually survived.