The cost of producing a one-lira coin has reached Turkish lira (TRY) 3.16 ($0.09), according to an opposition lawmaker.

The production cost for the coins carrying values of 50 kurus (the Turkish "cent", the kurus is pronounced as "kurush") and 25 kurus, now stood at TRY 2.63 and TRY 1.86, respectively, said Deniz Demir (@demirdenizchp), a Republican People’s Party (CHP) MP.

Some scrap dealers continue to benefit from the arbitrage by melting down Turkish coins, noted Demir.

The coins were next-to-useless given that the price of a loaf of bread was approaching TRY 15, the MP also said.

Hyperinflation kills value

Due to the hyperinflationary environment that has taken hold in Turkey across recent years, banknotes and coins in circulation have lost significant value. Turkey’s president, Recep Tayyip Erdogan, meanwhile, avoids calls for larger banknotes and coins.

Erdogan showed his pride when the public toilet fee was cut to one lira from one million lira after he removed six zeroes from lira values in 2005. However, the actual fee currently stands at TRY 3.16, with Erdogan subsidising TRY 2.16 to achieve TRY 1, according to calculations by Demir.

It was in 2021 that the nominal value of Turkish lira coins fell below their scrap value. In 2023, Turkey’s state mint Darphane reduced the weight of the coins. Turks subsequently complained that automats would not accept the new coins.

The weight of one lira coins fell to 6.6 grams from 8.2 grams and the weight of a 50-kurus coin fell to 5.5 grams from 6.8 grams.

The one-lira coin is 75% copper, 15% nickel and 10% zinc. Previously, it was 81% copper, 4% nickel and 15% zinc.

In October 2023, Darphane produced 100mn five-lira coins to commemorate the 100th anniversary of the founding of the Republic of Turkey.

In June 2024, Darphane introduced ordinary five-lira coins.

Deaf to calls

Calls for bigger banknotes are, meanwhile, totally ignored by the authorities. In November, local business daily Ekonomi reported that with consumers harrassed by hyperinflation, Turkish bankers were having to refill ATM machines three times a day with 100 and 200-lira banknotes.

At the Grand Bazaar in Istanbul, heavy-duty trolleys and makeshift suitcases line the alleys outside foreign-exchange shops, readied for the transport of increasing volumes of banknotes required to trade.

In October, Omer Mert, the general manager of small-cap Fibabanka, told BloombergHT during a televised interview that ATM machines often broke down due to the sheer volume of work they must endure in counting out money.

As of October, 81.3% of the banknotes in circulation in Turkey were 200-lira, the largest available banknote. The figure stood at 80.4% in September.