US Mint Gold and Silver Bullion Sales Highest in More Than a Decade
June 8, 2010 | Filed Under Bullion Sales, US Mint | 1 Comment
During May 2010, the United States Mint's gold and silver bullion sales levels reached their highest level in a decade or more for the two most popular offerings. This heavy demand for physical gold was experienced by several world mints last month, driven by concerns and uncertainty about Greece and the Euro.
The United States Mint sold 190,000 of their 1 oz. American Gold Eagle coins. This ranked as the highest monthly sales total for the bullion option since January 1999 when 208,500 coins were sold. The all time record high for sales in a single month took place in October 1986 when 609,500 of the one ounce coins were sold.
There were 3,636,500 of the 1 oz. American Silver Eagle coins sold during May 2010. This was just shy of the all time monthly sales record of 3,696,000 coins sold in December 1986. The month of May ended with a three day weekend, if one more day of sales had taken place, the record may have been broken. It's worth noting that Silver Eagle bullion coins are also subject to the US Mint's allocation (rationing) program, meaning these impressive sales still do not reflect full public demand.
Recent articles report similar surges in bullion coin demand. Production of Gold Krugerrands by the Rand Refinery reached their highest weekly production levels in 25 years. The treasurer of the refinery cited Germany as a large source of demand. The Perth Mint of Australia which did not provide production levels, has doubled their capacity over the past 18 months. As soon as the European Commission announced that they would bail out Greece their stock of gold "all went."
Perth Mint “Mini Roo” Half Gram Gold Coin
June 1, 2010 | Filed Under Uncategorized | Leave a Comment
I suppose it's natural that escalating gold prices would lead to smaller sized gold coin offerings. As the price has increased, standard sized gold bullion offerings grow more expensive, and perhaps out of reach for some smaller scale investments.
The Perth Mint recently introduced a half gram gold coin called the "Mini Roo." This is a miniature version of their popular Gold Kangaroo, which is also offered in weight ranging from one-tenth ounce to one kilo.
The diminutive coin features a newly designed bounding kangaroo and carries a legal tender face value of 2 Australian Dollars. The coins have a diameter of 11.60 mm, thickness of 0.70 mm, and contain 99.99% pure gold.
One half gram of gold works out to 0.016 troy ounces of gold. At today's gold price, the intrinsic value of the Mini Roo is $19.60. The Perth Mint's website shows the coins priced at US $38.18 each. This is actually only slightly cheaper than the pricing for one gram gold bars, but a manufacturing premium is to be expected for coins over bars.
2010 First Quarter Gold Demand
May 26, 2010 | Filed Under Gold | Leave a Comment
The World Gold Council has released Gold Demand Trends for the First Quarter of 2010. The report indicates a drop in gold demand for the covered period, but suggests that demand will be strong for the rest of the year.
Identifiable gold demand during the first quarter of 2010 was 760.2 tonnes, representing a drop of 25% compared to levels seen for the first quarter of 2009. The change was driven by a 69% decline in investment demand, offset by a 43% increase in jewelry demand and 31% increase in demand from industrial sectors.
The drop in investment demand was driven by a sharp decline in demand from ETFs and similar products. Total demand was only 3.8 tonnes for the quarter compared to 465.1 tonnes for the year ago period. Comparisons are also influenced by an unusually strong year ago period.
Investment demand did pick up right after the close of the first quarter, when concerns about Greece and debt contagion fears led to a significant pick up in demand for physical gold. In a previous post, I explored how physical gold demand had surged compared to the muted levels of the first quarter. More significantly, there has also been a resurgence in demand from the GLD ETF in the past month.
In their forecast for strong demand for the remainder of 2010, the WGC cites jewelry demand in India and China, as well as investment demand for the United States and Europe as the drivers.
Demand for Physical Gold Surging
May 18, 2010 | Filed Under Bullion Sales, Gold | Leave a Comment
There have been numerous recent reports about the surging demand for physical gold. It has been mostly concentrated in Europe, but there have also been signs of new waves of demand hitting the U.S.
This is a big shift from earlier this year. For the first two months of 2010, the Austrian Mint had reported that Gold Philharmonic sales had dropped 80% from the year ago levels. Similarly, the Royal British Mint had reported a drop in demand of about 50% through the end of the first quarter.
What a difference a crisis makes.
Recently, the Austrian Mint reported that they had sold more coins in two weeks than the entire first quarter, citing demand "exclusively from Europe." Swiss refiner Argor-Heraeus has estimated that demand for small gold bars and refined products has jumped tenfold compared to the start of the year.
On the US front, sales have strengthened in recent weeks, but there hasn't been the surging demand seen in 2008, which prompted repeated suspensions and bullion rationing programs.
For the month to date, the US Mint has sold 81,000 of their one ounce Gold Eagle bullion coins. This already tops the prior month total of 60,500. One ounce Silver Eagle bullion coins have sold 2,381,000 coins for the month to date, nearing last months total of 2,507,500. The newly released one ounce 24 karat Gold Buffalo has sold 54,000 coins for the month. The coins debuted on April 29, 2010, making prior month comparisons less meaningful.
2010 Proof Gold Buffalo and 2010 Fractional Gold Eagles
May 14, 2010 | Filed Under Gold, US Mint | Leave a Comment
Closely behind the release of the 2010 Gold Buffalo bullion coins, the United States Mint has two more gold products on the way. This includes the collectible proof version of the Gold Buffalo and fractional weight American Gold Eagles.
The 2010 Proof Gold Buffalo is now scheduled for release on June 3, 2010. Since this is a collector coin, it will be available for sale directly from the US Mint via their website. Each coin will contain one ounce of 24 karat gold and feature the design from James Earle Fraser's Buffalo Nickel. Pricing for the coins won't be known until the week of release, since it will be based on the average weekly price of gold. At the current gold price, the coins would be $1,510.
Last year, the 2009 Proof Gold Buffalo wasn't available for sale until October 29, 2009, amidst delays and cancellations across many of the US Mint's precious metals products. The coins remained available for sale until March 29, 2010 and sold 49,388 coins.
The US Mint has reportedly begun production of the fractional weight versions of the 2010 American Gold Eagle bullion coins. I've always felt that these smaller weight coins were an important part of the bullion program, as they allow for different investment levels. The US Mint has historically offered one-half ounce, one-quarter ounce, and one-tenth ounce size coins.
A release date for these coins has not been established. Once available, they will be sold via the US Mint's network of authorized purchasers, like other bullion offerings.
