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(November 8, 2009) As gold prices cross the $1100 mark, and make new
record highs, demand for both gold and silver bullion are strong.
However, the US Mint has already struck its last 2009 silver Eagle,
and possibly, the last gold Eagle that it will release this year.
This year the Mint has already sold 24,000,000 silver Eagles, a
record number, and more than a million gold 1-ounce Eagles. In order
to do those numbers, the Mint produced exactly zero platinum Eagles,
and for the first time since the American Eagles program began in
1986, skipped production of specially-packaged collectors’ versions
of proof Eagles entirely.
The lack of proof Eagles has hacked off tens of thousands of
numismatists who had faithfully built their sets of these premium-
priced coins over the decades, but the Mint’s announcement that there
will be no 2009-dated Eagle proofs seems to be final.
And now we’re coming to that time of year in which Eagle bullion coin
buyers may start to fell a little pain themselves.
Normally, the US Mint halts production of current year bullion Eagles
in the last few weeks of the calendar year, usually around
Thanksgiving or the first week in December. This allows production
to begin on Eagles bearing next year’s date, coins that are not
released until the first week of January.
This year, the halt to current-year Eagles production has come a
little early.
The US Mint, while currently busy striking 2010-dated Eagles, will
continue to release 2009-dated 1-ounce bullion silver Eagles only as
long as they have product ‘on the shelf.’
Further production of 1-ounce gold Eagles dated 2009 may or may not
happen in the next couple of weeks, but our guess is that there’s not
much chance after that.
Since the Mint doesn’t make their current supply figures public,
there’s really no way to tell what will happen over the final eight
weeks of 2009. As of this writing, silver and gold Eagles are not in
shortage, and premiums have yet to increase. But that situation could
quickly change.
Demand for gold Eagles has been strong all through this bull market
year in gold. To meet this demand for the USA’s most popular bullion
product, the Mint this year has struck and sold over a million 1-
ounce gold coins, compared to only 147,500 for the entire year 2007.
Of course, there are other gold bullion choices out there for US
buyers. Private refiners, such as Pamp Suisse and Credit Suisse, have
seen their US business increase tremendously, especially over the
past twelve months. Although the Middle East and Asia, where gold is
a familiar forms of wealth, have long absorbed the lion’s share of
gold that is refined worldwide, Marwan Shakarchi, the chairman of MKS
Finance, Pamp’s parent company, was quoted in an article “Inside the
Global Gold Frenzy” in the New York Times on 11/8/09, that “The US
and Europe are our emerging markets.”
As for gold and silver Eagles, if precious metals continue to build
momentum and draw new buyers, demand will continue to build and there
may be supply shortages. Or, a substantial price correction could
bring in a new crop of bargain-hunting gold buyers, who might then
find that the Mint is out of product until 2010, and premiums on the
floating supply could rise.
The last real shortages of gold bullion that the US market
experienced occurred during the period from October 2008 through
February of 2009, when our recent economic unpleasantness made itself
known. At that time, bullion mints and refineries the world over were
overwhelmed with the increased demand for gold bullion. Demand in the
US increased by several hundred percent, and European demand,
according to figures from the World Gold Council, increased some
1100% in the fourth quarter of 2008.
This calendar year, worldwide production of tradable forms of gold
bullion coins and bars has been stepped up to meet demand. So, even
if it does happen that US Eagles go into shortage before the year is
out, the mints of Canada, Australia, South Africa, Austria, and
private refiners such as Pamp Suisse, do not take such a delivery
holiday (the Australians have already released 2010-dated products,
as has the Royal Canadian Mint), so we expect that quite a range of
bullion coins and bars likely will be freely available through the
season.
And, on the positive side for fans of US Mint products, the Mint has
announced plans to finally release some 2009-dated fractional gold
gold Eagles in half-, quarter-, and tenth ounce sizes, probably by
the first week in December. As soon as we have a firm commitment on
their release, we will post them for sale on our gold Eagles page.
(Our working title for this piece was “Seasonal Trends in US Mint
Bullion Coin Production and Release, 1986-2008.” That seemed a little
dry, so we went with a more sensational title for Internet publication.)
-Richard Smith, November 8, 2009
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