Gold, silver coin demand surging, straining U.S. Mint's capacity
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FILE PHOTO: A quality control agent examines a 2013 enhanced silver eagle silver coin at the United States West Point Mint facility in West Point, New York June 5, 2013. REUTERS/Shannon Stapleton
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By Devika Krishna Kumar
NEW YORK (Reuters) - The United States Mint said on Tuesday it was unable to meet surging demand for its gold and silver bullion coins in 2020 and through January, due partly to pandemic-driven demand and plant capacity issues.
Sales of U.S. gold bullion coins rose 258% in 2020 while silver coin demand was up 28%, the U.S. Mint said Tuesday. Heavy buying has continued in 2021, it said, squeezing supplies, which had already been tight as the coronavirus affected production.
A social media-driven buying spree lifted silver futures to an eight-year high on Monday, but dealers in the market for coins were already grappling with a supply shortage and shipping delays before that rally.
The Mint, a division of the U.S. Treasury, had limited distribution of its silver coins to suppliers as it is currently changing the designs for its American Eagle Gold and Silver Bullion Coins.
"There was going to be a backlog in the silver bullion supply chain that rendered Silver Eagles more scarce either way," said Everett Millman at Gainesville Coins in Florida. He expected delays until mid-March for the most popular products.
"The silver coins and silver bars that are available have acquired significantly higher premia," he added.
In January, 220,500 American Eagle gold bullion coins were sold, up 290% from 56,500 a year earlier, the Mint said.
For this year, the U.S. Mint has a limited window to produce its current gold and silver coins, with redesigned coins expected to debut in the summer. It is limiting distribution of its gold, silver and platinum coins to specific dealers because of heavy demand, and a limited number of suppliers of metals, it said in a statement.
(Reporting by Devika Krishna Kumar in New York and Arpan Varghese in Bengaluru; editing by Richard Pullin)
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