by Louis Golino for CoinWeek
Steve Estes (http://www.steveestes.com) is a Portland, Oregon dealer who has in been in business since 1963, and who specializes in classic American coins, especially Morgan and Peace dollars. Last year I interviewed him for CoinWeek about his interest in coins and his expertise on silver dollars .
An Oregon woman contacted Mr. Estes a couple of months ago about a 1944-D steel cent she had inherited. She explained that she had shown the coin to another local dealer who said the coin was probably not real and who offered to buy it for a token amount as a curiosity. She believed the coin was real and was frustrated that she could not find anyone who would take her seriously.
When she spoke to Mr. Estes, he asked if a magnet attracted the coin, and she said it did. This indicated the coin was made of steel rather than copper like most 1944-D cents.
The woman then met with Mr. Estes, who could immediately tell the coin was real based on his decades of experience as a coin dealer and expert numismatist. The woman shared additional information and documentation about the coin with Mr. Estes.
Mr. Estes sent the coin to NGC for grading, and it came back as an MS61. The coin was submitted for auction by Heritage Auctions of Dallas, Texas, the third largest auction in the world. It was sold at the Heritage Platinum event held at the recent FUN show in Florida. The coin was sold for $58,201.50 on January 4 to an online bidder.
Prior to the sale of this coin, the most recent sales (both by Heritage) of 1944-D steel cents were earlier in 2011. In July an AU example garnered $23,000, and an AU-53 coin sold last January for $37,375.
According to a February 12, 1966 newspaper article in the San Mateo Times, in 1966 Robert Collins, a then-23 year old man from California discovered what at the time was the second-known 1944-D steel cent.
According to Heritage Auctions, “It was his habit to swap a regular cent for a steel cent whenever he found one in change. He brought the coin to two dealers, who found no reason to doubt it, and from there it went to Walter Breen, the most prominent authenticator of the time, who pronounced it genuine.”
In 1943 steel was used to make pennies, instead of copper, because copper was needed for the U.S. war effort. Because copper was considered a strategic metal during World War II, there was an effort to find an alternative metal to produce pennies.
According to Park Avenue Numismatics’ online Encyclopedia of U.S. coins , this effort resulted in the use of “low-carbon steel coated with zinc, which quickly corroded; cents of this stuff were coined in 1943, and in 1944 some more accidentally coined on leftover steel banks, even as some 1943 cents had been coined on leftover 1942 bronze blanks. Fewer than a dozen of either have been authenticated, though ten-thousands of forgeries exist of the 1943 bronze.”
The leftover steel planchets that were used to make a small number of 1944-D cents thus created one of the great rarities in modern U.S. coinage., a coin which Heritage describes as having rarity and appeal that remain timeless.
About 10 examples of this coin are believed to exist. PCGS puts the number at seven and has only certified one example, an MS 62. NGC’s web site says it has graded one MS62, and one MS63. The coin which Mr. Estes’ client brought in that received an MS61 must not have yet been added to NGC’s population report.
NGC’s Coin Explorer says that “In 1943, with copper urgently needed for combat-related purposes, the Mint made Lincoln cents from zinc-coated steel. The substitute proved unsatisfactory, and from 1944 through 1946 the Mint instead used the brass alloy first tried in 1942; this lacked the small percentage of tin employed before and after the war. At least a portion of this brass was obtained from salvaged cartridge cases, which did the job nicely. The one-year experiment left a lasting legacy when the Mint inadvertently struck minuscule numbers of 1943 cents in bronze and a slightly greater number of 1944 cents in steel. Both are quite rare and valuable. Many years ago, a false rumor spread around the country that Henry Ford would trade a new car in exchange for the fabled 1943 copper!”
Heritage has sold several such coins over the years. They range substantially in grade and have sold for sums that vary from $7700 for an AU coin in 1996 to $115,000 for the finest quality example, an MS63 that sold at auction in 2007.
According to the Heritage Auctions catalog description for the MS61 example that sold during the FUN action, “This example, despite being pulled from change, was awarded a Mint State grade in its recent certification by NGC. Several shallow, almost parallel diagonal abrasions are visible only at certain angles to the light, while a narrow streak of gray paler than the rest of the coin's medium-steel hue is visible on the photograph of the coin printed in the newspaper. A number of smallish oxidation spots are also visible in the vintage photograph; these appear not to have progressed since then. The weight is listed at 2.9 grams, a touch heavier than some other 1944-D steel cents but within tolerance. A great coin with a great story behind it -- and the documentation to prove it.”
The moral of this story is two-fold. First, there are great, rare coins that have yet to enter the market. Second, it is always highly advisable to seek the counsel of an experienced and knowledgeable dealer like Mr. Estes if one has a coin that could potentially be very rare and valuable. As always, do your research and find a dealer who knows the type of coin you think you have, and look for someone like Mr. Estes who has a reputation for honesty and integrity.
A dealer does not stay in business for almost 50 years unless he or she treats their customers well. Word eventually gets around if a dealer sells overgraded coins, or takes advantage of less knowledgeable sellers. If you are fortunate enough to live near an expert dealer, try to get to know them and you will learn a lot of useful information that will help you get more out of the hobby of kings, or as others put it, the world’s greatest hobby.
The information about the coin owned by Mr. Estes’ client appears here with the permission of Steve and Debbi Estes.
Louis Golino is a coin collector and numismatic writer, whose articles on coins have appeared in Coin World, Numismatic News, and a number of different coin web sites. His column for CoinWeek, “The Coin Analyst,” covers U.S. and world coins and precious metals. He collects U.S. and European coins and is a member of the ANA, PCGS, NGC, and CAC. He has also worked for the U.S. Library of Congress and has been a syndicated columnist and news analyst on international affairs for a wide variety of newspapers and web sites.