Precious Metals

Silver fever boosts silver American Eagle sales

An insatiable thirst for silver amid falling precious metals prices pushed U.S. Mint sales, on Sept. 30 alone, of 1-ounce silver American Eagle bullion coins to 766,000 pieces.

The Mint’s authorized purchasers followed that up Oct. 1 by ordering 1.15 million more silver American Eagles.

Increased investment demand triggered by dropping silver and gold spot prices drove American Eagle silver and gold bullion coin sales in September to levels more than double the previous month’s sales. 

Similarly, platinum American Eagle 1-ounce coin sales for September — 2,700 ounces — are nearly four times the number recorded sold by the Mint in August.

Silver closed at $17.11 per troy ounce on the London markets on Sept. 30, compared to the year’s high, so far, at $21.85, achieved Feb. 26. At this time last year, silver was hovering at the $22 an ounce level.

American Eagle silver 1-ounce bullion coin sales in September reached 4.14 million coins, more than double the 2,007,500 coins recorded sold in August.

However, March’s monthly sales total, with 5,354,000 silver coins recorded sold, remains the highest in 2014.

Cumulative 2014 sales of the American Eagle .999 fine silver bullion coins through Sept. 30 totaled 32,251,000 coins. 

In 2013, cumulative sales of silver American Eagle coins through Sept. 30 reached just over 36 million, toward a yearend total of 42,675,000 coins. 

Despite the surge of orders at the end of September and on Oct. 1, the Mint may produce fewer American Eagle silver bullion coins in 2014 than in 2013. For the past few years, sales of the coins in November and December have been weak compared to the prior 10 months. 

The Mint sells all American Eagle, American Buffalo and America the Beautiful bullion coins to a series of authorized purchasers, at the spot price per troy ounce of metal on a given day plus a small premium per coin. 

The authorized purchasers then redistribute the coins through wholesale and retail sales.

Silver stampede

Jim Hausman from one of the Mint’s authorized purchasers, The Gold Center in Springfield, Ill., said that firm was responsible for 15 percent of the Mint’s American Eagle silver bullion coin sales Sept. 30.

“We’re going through a lot of silver,” Hausman said Oct. 1, noting silver was testing the $17 per ounce barrier. “If you see it at $13 or $14 an ounce, I don’t think the U.S. Mint will be able to keep up with production, resulting in shortages.

“The public is putting a lot of silver away, including generics,” Hausman said. Generics are silver rounds, bars and similar items that are not issued by a government.

Hausman said he’s wondering when the U.S. Mint will cut off sales for the 2014-dated coins and begin 2015-dated production. No dates have been announced.

Sales of 2014 silver American Eagles didn’t begin until the third week of January because the West Point Mint was still striking 2013 silver American Eagles to demand.

Scott Thomas, president and chairman of another authorized purchaser, APMEX in Oklahoma City, said the firm purchased 200,000 silver American Eagles from the Mint on Sept. 30.

“Consumers are benefiting from the price drop of the coins and the spot price drop,” Thomas said. “Silver sales have been up, not just with Eagles, but Canadian Maple Leafs and our own silver products as well. September was a great month for us.”

Thomas estimates that for the past four years, APMEX has been responsible for purchasing 10 percent of the silver bullion coin production from the U.S. Mint.

Terry Hanlon, president of another Mint authorized purchaser, Dillon Gage Metals in Addison, Texas, said the firm purchased several hundred thousand silver American Eagles Sept. 30 and Oct. 1 from the U.S. Mint.

“Business has been picking up a lot over the past two to three months,” Hanlon said. “It’s hard to predict what prompts people to buy. The overall market has spiked. The appetite is not just for Eagles. The appetite is for silver.”

David Hendrickson, president of the secondary market distributor SilverTowne, in Winchester, Ind., said investors who have been sitting on the sidelines have decided to jump back into the market with a vengeance.

Hendrickson said the firm has been selling hundreds of thousands of ounces of silver American Eagles in addition to sales of bullion issues from other countries.

SilverTowne, which has its own private mint, on Sept. 30 sold 300,000 ounces of its own 1-ounce silver rounds and bars.

Golden numbers

During September, the Mint recorded sales totaling 58,000 ounces of the American Eagle gold bullion coins. September’s sales eclipsed January’s total, the previous highest monthly total in calendar year 2014.

The September sales total reflects 50,500 ounces in 1-ounce gold $50 coins, 2,500 ounces in half-ounce $25 coins (5,000 coins), 2,000 ounces in quarter-ounce $10 coins (8,000 coins), and 3,000 ounces in tenth-ounce $5 coins (30,000 coins).

September’s sales of half-ounce coins are the first sales of the half-ounce coins since June.

Calendar year 2014 American Eagle gold bullion coin sales through Sept. 30 reached 379,000 ounces — 296,000 ounces in 1-ounce coins, 16,000 ounces in half-ounce coins (32,000 coins), 23,000 ounces in quarter-ounce coins (92,000 coins), and 44,000 ounces in tenth-ounce coins (440,000 coins).

Cumulative monthly sales totals can be found on the Mint website at www.usmint.gov.

January’s sales are usually the highest for a given year, since that is when the incoming year’s coins are first released. The 1-ounce coins are traditionally acquired by investors, with the tenth-ounce size split among those wanting to be able to hold some gold, and those using the coins in jewelry.

Demand for the half-ounce and quarter-ounce sizes show no definitive division between collector and investor loyalty.

The closing spot price for the London PM fix for gold on Sept. 30 reached $1,216.50. The year’s high was $1,385, on March 14.

Platinum bullion sales

Cumulative 2014 sales of the 1-ounce, .9995 fine platinum American Eagle bullion coins through Sept. 30 totaled 16,300 coins.

Platinum American Eagle bullion coin sales resumed in March 2014 with the 1-ounce coins only, following a suspension of platinum American Eagle bullion coin sales since November 2008. In November 2008, the Mint sold only the half-ounce size of American Eagle platinum bullion coins (800 pieces).

The Mint is currently offering only the 1-ounce, $100 face value platinum coins, with no plans to offer fractional $50 half-ounce, $25 quarter-ounce and $10 tenth-ounce coins.

The price of platinum closed Sept. 30 at $1,300, compared to the high of $1,511, reached July 2. 


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