Insights

American Eagle palladium bullion coin program is not dead, just not on the U.S. Mint's radar now

Readers Ask column from the June 23, 2014, issue of Coin World
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By , Coin World
Published : 06/08/14
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Is the 1-ounce Winged Liberty Head palladium coin a dead issue?

Joe Rosenberg, Bloomfield, N.J.

It’s not necessarily dead, just dormant. An American Eagle palladium coin congressionally suggested in 2010 just isn’t on the U.S. Mint’s current radar.

If the U.S. Mint does have plans to move forward with a palladium bullion coin, officials are not publicly sharing the news. Should we learn of a new palladium offering from the U.S. Mint, Coin World readers will be the next to know.

A U.S. Mint-commissioned feasibility study submitted March 1, 2013, to Congress suggests that while an American Eagle palladium bullion coin program for investors would likely be unprofitable, Proof and Uncirculated coins offered to collectors might draw limited interest, yet still be profitable. 

The palladium market study was completed by New York City-based CPM Group under provisions of the American Eagle Palladium Bullion Coin Act of 2010 (Public Law 111-303).

The strongest demand for an American Eagle palladium coin would be during the first year of the program, the findings state. CPM Group bases that assessment on the newness of the program and speculation, which could draw interest from collectors and investors alike. 

CPM Group outlined a 10-year demand forecast, suggesting 150,000 troy ounces in total sales the first year — 100,000 ounces in bullion coins, 33,333 ounces in Proof coins and 16,667 ounces in Uncirculated pieces. Demand is projected to slip to 40,000 ounces the second year — 20,000 in bullion coins, 13,333 in Proof pieces and 6,667 in Uncirculated coins. By the 10th year, demand is projected at 4,500 ounces — 3,000 in bullion coins, 1,000 in Proof coins and 500 in Uncirculated coins. 

CPM Group researchers found that demand would be insufficient to profitably sustain a palladium bullion coin program. 

While demand would also likely be limited for Proof and Uncirculated collector versions, a numismatic coin program could still turn a profit, according to the findings. 

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