Precious Metals

Mint sales of silver American Eagles break record

Demand for American Eagle silver bullion coins in 2015 has been like no other in the nearly three decades the coins have been struck and sold by the U.S. Mint.

With only the Dec. 7 and Dec. 14 weekly allocations of silver American Eagles to authorized purchasers remaining, the U.S. Mint has recorded sales thus far of 44.85 million coins.

That’s 844,000 coins more than the Mint sold for all of calendar year 2014, when it set its previous sales record of 44,006,000 coins.

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U.S. Mint officials announced that production of 2015 coins with available blanks will continue through Dec. 7. Officials indicate that the Dec. 7 and 14 weekly allocations are likely to be between 900,000 and 1 million coins each.

Sales of 2016 coins are not scheduled to begin until Jan. 11.

U.S. Mint spokesman Michael White said Dec. 2 that production at the West Point Mint of 2016 silver American Eagles is to begin Dec. 14.

The U.S. Mint allocated 920,500 silver American Eagle bullion coins to its authorized purchasers Nov. 30, with 737,000 of the total sold the same day. The remaining 183,500 coins were reported sold Dec. 1.

Those two days of sales brought the cumulative 2015 total to 44,850,000 and counting. 

Possibly even higher?

January’s sales were the highest for calendar-year 2015, with 5.53 million coins sold, followed by July with 5,529,000 coins. Other monthly sales totals possibly could have been even higher than those two numbers, had sales not been under weekly restrictions because of the Mint’s difficulty in acquiring enough planchets for striking the bullion coins.

Government and private mints worldwide have reported problems in obtaining finished planchets for their silver bullion coins and medals.

The intrinsic value of silver has also see-sawed during 2015.

The closing London PM spot price for silver per troy ounce for the year has ranged from a high of $18.23 on Jan. 23 to a low of $14.07 on Nov. 25.

Six years ago, in 2009, the U.S. Mint experienced strong demand for American Eagle silver bullion coins. The demand triggered a remarkable increase in sales from the previous year’s results, as annual sales increased to 28,766,500 from 20,583,000 in 2008. In turn, 2008 sales were double those of 2007, when 9,028,036 of the bullion coins were sold.

The spot price of silver fluctuated even more wildly in 2009 than it has in 2015,  ranging from a high of $19.18 on Dec. 2 to a low of $10.51 on Jan. 15.

The 2008 spot price high reached $20.92 on March 17 and the low was $9.01 Oct. 27.

Demand was such in 2009, carrying over from 2008, not only for the American Eagle 1-ounce silver bullion coins, but for the American Eagle 1-ounce gold bullion coins as well, that the Mint diverted all of its available planchets for both programs to bullion coin production. No Proof 1-ounce silver or gold American Eagles were produced in 2009.

The same planchets supplied for the bullion coins are also used for the Proof versions, except the planchets are highly polished before striking for the Proof coins, and the Proof versions are struck twice instead of once like the bullion coins.

The Mint has added more blank suppliers in the intervening years from 2009 to 2015 to augment its production, but supply has proven to be not enough to meet worldwide demand.

In addition to weekly allocations of struck coins for most of 2015, from 2009 through 2015 the Mint has also experienced several periods when sales were suspended to allow depleted inventories of struck coins to be re-established.

Since the American Eagle silver bullion coin program was launched in November 1986, combined sales through Dec. 1, 2015, have reached 446,419,000 coins.

The highest monthly sales total for the silver American Eagle bullion coin program is for January 2013 with 7,498,000 coins.

The lowest monthly sales recorded were for the months of July 1987 and September 1994, when no coins were recorded sold.

From 1986 through 2008, the highest monthly sales totals in 17 of those 23 calendar years were recorded in December.

Up until 2009, the Mint would often cease production of the current year’s coins well before the end of the calendar year to begin production of the next year’s issue.

Also, for much of the existence of the program, authorized purchasers were often accorded the opportunity during the last two weeks of December to place orders for the next year’s coins for pickup after Jan. 1.

As a result, calendar year sales during at least the first 22 years of the program likely include coins dated from more than one calendar year.

However, because of the increased demand for silver American Eagles from collectors and investors, the Mint has not begun sales of silver American Eagle bullion coins until after Jan. 1 for at least the past six years.

Since that change in procedure, the highest monthly sales totals for 2011, 2012, 2013 and 2015 have been in January.

While 2015 will establish a new calendar-year sales high, the lowest annual sales were recorded in 1996, with 3,466,000 tallied sold. That year’s coin is now a key date in the series.

The American Eagle silver bullion coins are not sold directly to the public. Instead, the coins are sold to a network of authorized purchasers who offer a two-way market for the coins. Orders are placed based on the closing London PM spot price per troy ounce plus a $2 premium per coin. The coins are then sold at a mark-up to other dealers, collectors and investors.

Sales of the American Eagle silver coins to the authorized purchasers have been on weekly allocation for most of 2015 because of the planchet shortages.

Worldwide demand

Worldwide, demand for silver has been strong in various areas. Silver coin demand during calendar 2015 is projected to increase 21 percent over 2014 demand, to 129.9 million troy ounces, according to the Interim Silver Market Review issued Nov. 17 by Thomson Reuters.

According to the report, demand for silver coins is forecast to reflect 12 percent of overall physical demand for the precious metal, an increase of 2 percent over 2014 levels.

The precipitous drop in silver prices during July and August to six-year lows fueled silver coin buying, particularly in North America, where coin sales jumped 103 percent to 23.6 million troy ounces during the calendar year 2015 third quarter. Total silver supply, according to the report, is projected to slip to 1,014.4 million troy ounces in 2015, down 3 percent from 2014.

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