March 28, 2024

US Mint Gold and Silver Bullion Sales Through May 2009

As in the past, I wanted to write another post examining the US Mint’s monthly gold, silver, and platinum bullion coin sales. Previously these figures were a flawed method of examining demand for physical precious metals due to the rationing program in place from the United States Mint. As long as authorized purchasers of US Mint bullion coins were restricted in the quantities they could purchase, it was difficult to ascertain how much unmet demand existed behind the rationing wall.

However, this month the figures might be closer to providing a useful measure. As I mentioned in several posts this month, a likely combination of decreasing demand and increasing supply has turned the Gold and Silver Eagle shortage to a surplus. For the first time since the rationing programs began, authorized purchasers did not purchase the maximum number of coins allotted by the US Mint.

Here’s a look at the US Mint gold, silver, and platinum bullion sales for the month of May 2009, along with a year to date total in the final column.

April 2009 US Mint Bullion Sales
1 oz. 1/2 oz. 1/4 oz. 1/10 oz. Total oz. YTD Total oz.
Gold Eagle 65,000 65,000 554,500
Gold Buffalo
Silver Eagle 1,904,500 1,904,500 11,579,500
Platinum Eagle

There were sales of 65,000 ounces of gold during May 2009. Once again this consisted entirely of one ounce 2009 Gold Eagles, as the US Mint did not offer fractional coins or the 24 karat Gold Buffalo. This was a big drop from the prior month when 147,500 ounces were sold, however it is more than double the number of coins sold in the year ago period of May 2008 when 31,500 ounces were sold.

There were sales of 1,904,500 ounces of silver during May 2009. This was a decline from the prior month when 2,518,000 ounces were sold and a decline, but still up from the year ago period of May 2008 when 1,516,000 ounces were sold. Sales of silver bullion still remain on pace for a record breaking year. The current record was set during 2008 when 19,583,500 ounces were sold for the entire year.

Platinum bullion coins were still not offered for sale by the US Mint. No platinum bullion coins have been offered since November 2008. The US Mint has not provided any additional statements on the status of platinum bullion coins. Notably, the Royal Canadian Mint has been able to produce and sell their Platinum Maple Leaf coins during 2008.

Based on the figures for the gold and silver bullion sales, demand for physical precious metals is apparently dropping significantly at a time when the market prices of the metals seemed to be gaining some momentum. This could be a seasonal impact since prior sales figures show the sales trailing off during the summer months. Or it could be a signal that some buyers are taking pause to see if the much ballyhooed “green shots” actually take root or whither up and die.

Disclosure: Long physical gold and silver

Gold and Silver Eagle Shortage Becomes Surplus

For countless months, authorized purchasers of US Mint gold and bullion coins have been subject to a rationing process, which limited the number of coins they could purchase. The rationing program had been put into place after the demand for gold and silver coins exceeded the US Mint’s ability to supply them. In a few recent posts I have provided some indications that the shortage of American Silver Eagles and American Gold Eagles might be ending. There’s yet another indication that the end of the shortage and rationing is close at hand.

Throughout the rationing period, the entire supply of coins available from the US Mint had been divvied up and sold to the authorized purchasers. For the first time since rationing began, the US Mint failed to sell their total production of Gold and Silver Eagles.

Dave Harper, the editor of Numismatic News, writes:

In the prior two weeks, the 14 purchasers authorized to buy the American Eagle coins from the U.S. Mint have not taken the maximum number of coins that are available, leaving the Mint with an extra 39,000 one-ounce gold American Eagles and 185,000 extra silver American Eagles.

To my knowledge, the rationing program for Gold and Silver Eagles still remains in place despite the surplus of recent weeks. The US Mint is likely waiting to build an inventory of bullion before attempting to remove purchasing restrictions completely.

When the rationing program was instated by the US Mint, it generated a lot of attention from blogs and news sites. The rationing was cited as evidence of the overwhelming demand for physical precious metals that would eventually carry market prices higher. With the opposite situation developing, opposite predictions have emerged.

In befuddlement to both arguments, the the disconnect between physical demand and market price continues. Amidst the unraveling of the physical scarcity situation, the prices for gold and silver have risen to multi-month highs with many predicting impending breakouts, which will carry prices even higher.

US Mint Bullion Sales for April 2009

The US Mint’s bullion sales figures for April 2009 remained robust. The amount of gold bullion sold during the month was the highest of the year. Silver bullion sold was the second highest figure for the year. Once again, the US Mint did not sell any platinum bullion coins. This offering has been delayed with no indication of when sales might begin. Similarly, the 24 karat Gold Buffalo coins were not offered as they are also delayed.

The sales totals for all bullion coins offered by the United States Mint are presented below.

April 2009 US Mint Bullion Sales
1 oz. 1/2 oz. 1/4 oz. 1/10 oz. Total oz.
Gold Eagle 147,500 147,500
Gold Buffalo
Silver Eagle 2,518,000 2,518,000
Platinum Eagle

There were 147,500 ounces of gold sold during April 2009. This consisted entirely of one ounce gold coins, as fractional coins were still not offered.This represented the highest sales level of the year to date. The prior month had sales of 136,500. Sales for the year ago period of April 2008 were 47,500 ounces.

There were 2,518,000 ounces of silver sold during April 2009. Silver bullion sales continue to be at higher levels, on pace for a record year. Since the coins are subject to rationing, this might be an indication that the Silver Eagle shortage might be ending. The prior month silver bullion sales were 3,132,000. Sales for the year ago period of April 2008 were 1,584,000.

Is the Silver Eagle Shortage Ending?

World mints have struggled to keep up with the booming demand for precious metals. The situation has been ongoing for more than a year and frustrated physical silver investors with suspensions, rationing, and delays. There are finally some signs that the shortage may be coming to an end, in particular for the American Silver Eagle bullion coin.

The Silver Eagle shortage first began in February 2008. The US Mint became so overwhelmed with orders for the popular silver bullion coin that they were forced to suspend taking new orders. The suspension was only in place until March 2009, however, sales were resumed on a rationed basis. Authorized purchasers were limited in the number of coins that they could order. Early suggestions indicated that the rationed amounts covered only a fraction of the overall demand.

More than one year later, there are some indications that the situation may finally be abating. As I mentioned in my post on the US Mint’s March 2009 Bullion Sales, sales of silver and gold reached extremely high levels. Sales of silver coins were actually the highest monthly total since 1986. Since these are rationed sales, the high level was more of an indication of reduced supply constraints than increased demand.

Recently, there have been more indications at the dealer level that the shortage may be ending. One  dealer has reported that delays for delivery of Silver Eagles are shortening, and premiums for the coins is declining. At the height of the shortage premiums were as high as $4.50 over the spot price of silver. Premiums have now pulled back to around $3.00 over spot.

Half Gram Gold Coins

The World Gold Council recently announced their plans to attempt to popularize half gram gold coins. The plan seems mostly targeted towards consumers in India, in advance of the upcoming festival.

How small is a half gram of gold? There are 31.1034768 grams in one ounce. If you are familiar with the one-tenth ounce size gold coin, a half gram of gold would be about one-sixth of that size. The value of one half gram of gold based on Friday’s gold closing price would be about $14.68.

The story about half gram gold caught my attention because it is the opposite of what’s happening with gold in other parts of the world. As the price of gold increases, it makes sense to popularize smaller size coins or bars so that a mainstream audience will continue to have options for investing in gold. In the United States, smaller sized coins have actually been suspended in favor of producing only one ounce coins.

This step was taken by the US Mint at the end of 2008. At least one other world mint that I follow, took similar action. For all of 2009, the US Mint has only produced gold bullion coins in the one ounce size. Based on the current price of gold plus the standard markup, the price tag for the smallest possible gold purchase approaches $1,000. This may be out of reach for many potential investors.

In advance of Y2K, there was a renewed interest in precious metals investing as a disaster hedge. Even mainstream consumers began to buy into the story, bringing in many new gold investors with budgets both large and small. When Y2K precious metals investment reached its peak in 1999, the US Mint sold 2,750,338 1/10 ounce gold coins which would have cost around $40 each. The 275,000 ounces sold via 1/10 ounce coins actually exceeded the total amount of gold bullion sold by the US Mint for some prior years.

The current lack of fractional sized bullion coins has effectively cut off a significant portion of gold investment demand. Importantly, this is demand which would come from a mainstream investment audience, which gold currently lacks.

US Mint Reports Highest Monthly Silver Bullion Sales Since 1986

As I have in the past, I have compiled the total bullion sales from the US Mint’s bullion coin programs. The numbers for March 2009 bullion sales carry a bit of a surprise. The US Mint recorded the highest monthly silver bullion sales since December 1986, which was the second month the silver bullion coins were offered.

During March 2009, the US Mint only sold one ounce American Gold Eagles and one ounce American Silver Eagles. They continue to delay production of the 24 karat Gold Buffalo coins, all Platinum Eagle bullion coins, and fractional versions of the Gold Eagle. The sales totals for the two available bullion coins are presented below.

March 2009 US Mint Bullion Sales
1 oz. 1/2 oz. 1/4 oz. 1/10 oz. Total oz.
Gold Eagle 136,500 136,500
Gold Buffalo
Silver Eagle 3,132,000 3,132,000
Platinum Eagle

Total ounces of gold sold during March 2009 was 136,500 ounces. This is an increase from the prior month when 113,500 ounces were sold. It’s a big jump from the year ago period of March 2008 when 50,000 ounces were sold.

Total ounce of silver sold in March 2009 was a whopping 3,132,000. This is up from the prior month when 2,125,000 ounces were sold and the year ago period when 1,855,000 ounces were sold. This represents the second highest total since the bullion coins were first offered in 1986. The highest total was attained for the month of December 1986 at 3,696,000.

There are two ways to interpret last month’s surge Silver Eagle bullion coin sales. As readers of this blog will know, the US Mint has cut, delayed, or suspended nearly every gold and silver product except for the one ounce Gold Eagle and Silver Eagle coins, which continue to be subject to rationing. That being the case, the level of sales is not really an indicator of demand, but an indicator of how many precious metals blanks the US Mint was able to obtain and mint into coins.

On one hand, the increased amount of sales could suggest that the scarcity for precious metals blanks is finally abating. The US Mint was able to obtain more blanks to produce bullion coins than any other month since the rationing program began in February 2008.

On the other hand, the demand for precious metals has continued in full force even during the month when the stock market supposedly “bottomed” and the world economy supposedly “turned the corner.” Beyond the reported sales, there also remains a wall of unmet demand ready, willing, and able to buy more silver when and if the rationing programs are ever removed.

US Mint Suspends Production of More Gold and Silver Coins

The United States Mint has officially announced the suspension of another slate of gold and silver products. The affected products are 2009 dated American Gold and Silver Eagle coins produced for collectors. These coins are considered collectible versions of the bullion coins.

Although these are collectible coins, they represent a sizable amount of precious metals sales and represent a method of gold and silver investment for many individuals. Last year, the US Mint sold 1,157,911 ounces of silver in the form of Silver Eagle coins minted for collectors. They also sold 155,740 ounces of gold in the form of Gold Eagle and Gold Buffalo coins minted for collectors.

The following message was posted on the US Mint’s website in the space where the collectible Gold Eagle coins typically appear. The proof coins has been offered uninterrupted since 1986. The uncirculated version has been offered since 2006.

Production of United States Mint American Eagle Gold Proof and Uncirculated Coins has been temporarily suspended because of unprecedented demand for American Eagle Gold Bullion Coins. Currently, all available 22-karat gold blanks are being allocated to the American Eagle Gold Bullion Coin Program, as the United States Mint is required by Public Law 99-185 to produce these coins “in quantities sufficient to meet public demand . . . .”

The United States Mint will resume the American Eagle Gold Proof and Uncirculated Coin Programs once sufficient inventories of gold bullion blanks can be acquired to meet market demand for all three American Eagle Gold Coin products. Additionally, as a result of the recent numismatic product portfolio analysis, fractional sizes of American Eagle Gold Uncirculated Coins will no longer be produced.

A similar message is posted in the section where collectible American Silver Eagle coins would typically appear. The proof coins have also been offered uninterrupted since 1986 and the uncirculated coins since 2006.

Production of United States Mint American Eagle Silver Proof and Uncirculated Coins has been temporarily suspended because of unprecedented demand for American Eagle Silver Bullion Coins. Currently, all available silver bullion blanks are being allocated to the American Eagle Silver Bullion Coin Program, as the United States Mint is required by Public Law 99-61 to produce these coins “in quantities sufficient to meet public demand . . . .”

The United States Mint will resume the American Eagle Silver Proof and Uncirculated Coin Programs once sufficient inventories of silver bullion blanks can be acquired to meet market demand for all three American Eagle Silver Coin products.

This adds to the lengthy list of 2009 dated precious metals products that have been “temporarily delayed” or suspended by the US Mint. In my previous post Actions of the US Mint Discourage Gold Ownership, I mentioned the delayed release of 2009 Gold Eagle fractional coins, 2009 Gold Buffalo coins, and all 2009 Platinum Eagle coins. The delay, which was first announced in November 2008, continues with no further explanation provided.

For those keeping track, here is a list of the US Mint’s 2009 precious metals products that have been “temporarily delayed” or suspended:

  • 2009 American Gold Eagle 1/2 oz. (bullion)
  • 2009 American Gold Eagle 1/4 oz. (bullion)
  • 2009 American Gold Eagle 1/10 oz. (bullion)
  • 2009 American Platinum Eagle 1 oz. (bullion)
  • 2009 American Platinum Eagle 1/2 oz. (bullion)
  • 2009 American Platinum Eagle 1/4 oz. (bullion)
  • 2009 American Platinum Eagle 1/10 oz. (bullion)
  • 2009 American Gold Buffalo 1 oz. (bullion)
  • 2009-W Proof American Gold Eagle 1 oz. (collector)
  • 2009-W Proof American Gold Eagle 1/2 oz. (collector)
  • 2009-W Proof American Gold Eagle 1/4 oz. (collector)
  • 2009-W Proof American Gold Eagle 1/10 oz. (collector)
  • 2009-W Proof American Gold Eagle 4 Coin Set (collector)
  • 2009-W Uncirculated American Gold Eagle 1 oz. (collector)
  • 2009-W Proof American Silver Eagle (collector)
  • 2009-W Uncirculated American Silver Eagle (collector)

In addition, the following precious metals related products were discontinued by the US Mint for 2009. These discontinuations were announced in November 2008. Amidst the environment of unprecedented demand for precious metals, the US Mint determined that these products were “unpopular.”

  • Uncirculated American Gold Eagle 1/2 oz. (collector)
  • Uncirculated American Gold Eagle 1/4 oz. (collector)
  • Uncirculated American Gold Eagle 1/10 oz. (collector)
  • Unriculated American Gold Eagle 4 Coin Set (collector)
  • Uncirculated American Gold Buffalo 1 oz. (collector)
  • Uncirculated American Gold Buffalo 1/2 oz. (collector)
  • Uncirculated American Gold Buffalo 1/4 oz. (collector)
  • Uncirculated American Gold Buffalo 1/10 oz. (collector)
  • Unriculated American Gold Buffalo 4 Coin Set (collector)
  • Proof American Gold Buffalo 1/2 oz. (collector)
  • Proof American Gold Buffalo 1/4 oz. (collector)
  • Proof American Gold Buffalo 1/10 oz. (collector)
  • Proof American Gold Buffalo 4 Coin Set (collector)
  • Uncircualted American Platinum Eagle 1 oz. (collector)
  • Uncircualted American Platinum Eagle 1/2 oz. (collector)
  • Uncircualted American Platinum Eagle 1/4 oz. (collector)
  • Uncircualted American Platinum Eagle 1/10 oz. (collector)
  • Uncircualted American Platinum Eagle 4 Coin Set (collector)
  • Proof American Platinum Eagle 1/2 oz. (collector)
  • Proof American Platinum Eagle 1/4 oz. (collector)
  • Proof American Platinum Eagle 1/10 oz. (collector)
  • Proof American Platinum Eagle 4 Coin Set (collector)

That makes a total of 38 precious metals products which have been delayed, suspended, or discontinued by the US Mint.

As it currently stands, investors or collectors looking to purchase newly minted American Eagle or American Buffalo precious metals products have only two options available. These are the 2009 1 oz. American Gold Eagle and the 2009 1 oz. American Silver Eagle. Both of these products continue to be subject to rationing.

February 2009 US Mint Gold, Silver, and Platinum Bullion Sales

Another month has gone by already, so let’s take a look at the US Mint’s bullion sales for the month of February.

As an indicator of demand the bullion sales are not as useful as they used to be. This is because the US Mint continues to ration sales of one ounce Silver Eagles and one ounce Gold Eagles due to heavy demand and low supplies of blanks. They still have not begun production or sales of fractional gold bullion coins, their 24 karat gold bullion coin, or platinum bullion coins.

February 2009 US Mint Bullion Sales
1 oz. 1/2 oz. 1/4 oz. 1/10 oz. Total oz.
Gold Eagle 113,500 113,000
Gold Buffalo
Silver Eagle 2,125,000 2,125,000
Platinum Eagle

The total ounces of gold sold during February 2009 was 113,500. That was up from the prior month when 92,000 ounces were sold and way up from the year ago period when 27,500 ounces were sold. If the current pace continues the US Mint will be on track to sell over one million ounces during 2009.

The total ounces of silver sold for February 2009 was 2,125,000. This is up from the prior month total of 1,900,000 ounces. In the year ago period only 200,000 ounces of silver were sold due to a lengthy sales suspension.

As mentioned, the suspension of platinum bullion coin production continued through February 2009.

2009 Ultra High Relief Gold Double Eagles: US Mint Can’t Deliver Their Own Hype

Back in December, I examined the upcoming 2009 Ultra High Relief Double Eagle Gold Coin offering from the US Mint. I expressed the opinion that the US Mint would have problems handing demand for the new coin. Several months later, the US Mint has had problems with virtually every aspect of the product, from the inability to obtain gold blanks to the botched production of paperback books.

The Ultra High Relief Double Eagle recreates the original design for the 1907 Gold Double Eagle created by Augustus Saint Gaudens. Each coin contains one ounce of 24 karat gold and is struck on a specialized blank, which is 50% thicker than the blanks used for most one ounce gold bullion coins.

The US Mint began publicly touting the coin as early as March 2008, calling it a “recreated masterpiece” and the “nation’s most beautiful coin.” US Mint Director Edmund Moy has called it “one of the best coins ever made in the world throughout all of history” and likened owning the coin to owning a Monet.

Perhaps the current environment of limited gold blank supply was not the best time for the high profile launch of a flashy gold prestige coin.

Pricing and Availability

Sales of the Ultra High Relief Gold Coins began on January 22, 2009. The US Mint tried to head off the anticipated high demand by setting an ordering limit of only one coin per household. This ordering limit remains in place. Coins were initially priced at $1,189 per coin. This price has been raised three times in the subsequent months to its current level of $1,339 per coin. When sales began, the US Mint indicated that orders for the coin might take six to nine months to complete.

Many people attempted to get around the order limitation by enlisting the help of friends and family with unique household addresses. Coin dealers were also forced to try to find a way to circumvent the ordering limit. They offered a gauranteed premium to anyone willing to order the coins for them. Some customers felt that the price was set too high, but complaints were not widespread. Many were dismayed about the prospect of waiting six to nine months for their orders.

Limited Gold Blank Supply

Several days after the coins went on sale, Edmund Moy revealed that so far the US Mint had only able to obtain enough blanks to produce 29,000 coins. Customers had ordered approximately this number of coins during the first day of sales. To date more than 48,000 coins have been ordered.

The implication is that anyone who had ordered on the first day might receive their coins soon, but customers who placed their orders after the first day, might be in for a long wait. There has been no indication of whether the US Mint has been able to procure additional blanks beyond the first reported batch of 29,000.

Shipping Delays and Miscommunications

During the weeks that followed, US Mint customers began receiving a series of emails which provided a confusing array of estimated shipping dates. Some customers received four or five emails which included a different shipping date each time. These shipping dates often conflicted with the estimated shipping dates available in customer account screens. Some of the earlier dates came and went with no coins shipped.

Amidst the wave of emails, the first coin actually received in hand was reported February 9, 2009 at online social networking site Coin Network. After this first report, many assumed widespread shipping of the first 29,000 coins would follow. As the days passed, it became apparent that only a small number of coins had actually shipped. The rest were inexplicably delayed.

Shipping Problems and Website Security Issues

Following the arrival of the first coin, US Mint customers began to report shipping issues for other US Mint orders, as well as security issues that were impacting Ultra High Relief Double Eagle coin orders. The US Mint’s shipping contractor had reportedly been leaving packages filled with thousands of dollars of gold coins on customer doorsteps without signature or any other confirmation of delivery. The US Mint’s website had an easily exploited security flaw which caused some customers to have their orders canceled without authorization.

The US Mint disabled some of the functions of their website to prevent the further unauthorized cancellation of orders. They never broadly informed customers of the underlying problems or the potential resulting delays.

Production Problems for the Companion Book

The final and most recent problem in the Ultra High Relief saga relates to the Companion Book, which the US Mint produced to accompany the gold coin. Apparently, a production problem caused the book covers to warp or curl.

Today, the US Mint sent an email to all customers announcing that they would resume shipping of the Ultra High Relief coins, and the companion books would be shipped separately. The email did not mention the shipping problems, website security problems, possible gold blank limitations, and overlooked the fact that customers had never been informed of a shipping delay in the first place. Besides the series auto generated emails with inaccurate shipping dates, this was the first email sent to customers to explain why they haven’t received their coins.

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January 2009 US Mint Gold, Silver, and Platinum Bullion Sales

Many track the tonnes in the trust for Gold and Silver ETFs in order to gauge the continuing growth in investment demand for precious metals. This year, I wanted to try my own version of tracking precious metals investment demand by reporting monthly sales totals for the US Mint’s bullion coin programs. Hopefully this will provide another aspect of information for investors to ponder.

Under normal circumstances, this information would be an excellent indicator for physical precious metals demand. However, we are not currently in an environment of normal circumstances.

The US Mint continues to ration sales of one ounce Gold Eagle and Silver Eagle coins. Additionally, they still have not yet begun offering Platinum Eagle or fractional Gold Eagle coins. This implies that there is an undefined amount of unmet physical demand which exists above and beyond the numbers. Nonetheless, I will get into the habit of posting this information.

January 2009 US Mint Bullion Sales
1 oz. 1/2 oz. 1/4 oz. 1/10 oz. Total oz.
Gold Eagle 92,000 92,000
Gold Buffalo
Silver Eagle 1,900,000 1,900,000
Platinum Eagle

Total ounces of gold sold during January 2009 was 92,000 ounces. This compares to 26,000 in January 2008. The amount does represent a decline from the prior month of December 2008 when 176,000 ounces were sold. However, as mentioned above, this may be a reuslt of ratoining and not necessarily decreased demand.

Total ounces of silver sold duing Janaury 2009 was 1,900,000 ounces. This is down from both the year ago period January 2008 when 2,170,000 ounces were sold and the prior month when 2,158,500 ounces were sold. Again, this might not necessarily be a result of decreased demand.

No platinum was sold during January 2009, as the US Mint has not resumed productoin after a suspension instated late last year.