On Wednesday, the U.S. Mint reported that it is temporarily sold out of American Eagle silver coins due to high demand. Included in the statement released to their largest U.S. coin wholesalers, the U.S. Mint says that production of 2014-dated coins will continue.
This announcement wasn’t made public, but was confirmed by a U.S. Mint spokesperson. The Mint also advised authorized participants when additional inventory would be made available without disclosing further details.
In 2013, demand for silver coins and bars accounted for just over a fifth of the total annual demand. A ration on Silver Eagle coins, which had been in place since January of 2013, was lifted by the U.S. Mint in June. With gold and silver prices at their lowest in more than four years, investment coins and small bars are experiencing a surge in demand. Retail investors, buyers in Germany and even U.S. investors, who have been ghosts in the market for years, are beginning to stockpile.
These events are having a resounding effect on the entire market. The United States and Asia are battling each other for Canadian Maple Leaf silver coins produced by the Royal Canadian Mint (RCM). “The premiums of silver Maple Leaf bullion are going to rise soon, because dealers cannot get their hands on the coins,” says Scott Spitzer, Chief Operating Officer at Manfra Tordella & Brookes, one of the largest U.S. coin wholesalers in New York. Due to the high demand for gold in September, the RCM has started rationing its silver coin sales for its global distributors.
“Silver Maples are being snapped up by U.S. and Asian buyers as the premiums are lower than for silver Eagles,” says Mark O’Byrne, Research Director at GoldCore. “Silver Philharmonics continue to be popular in Europe as they too are cheaper than Eagles, with a similar premium to Maples.”
Platinum coin sales shared a similar fate back in early September. The U.S Mint sold 13,700 ounces of coins, including 10,000 ounces of platinum sold in the first three weeks after the relaunch in March. These figures were far below the Mint’s 50,000-ounce production of last year. Considering the path platinum took, what direction will silver be taking after the saturation of high demand?
One ounce of gold is now equal to 74 ounces of silver. That is the largest spread between the two since early in 2009. The U.S. Mint sold 1.4 million ounces of silver American Eagle last Friday alone. That marked the highest daily sale since the 2014-dated coins became available back in January.
