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US Mint silver coin sales drop sharply in February

The silver coin market was rocked by the announcement from the U.S. Mint that sales of its American Eagle Silver coins had fallen by a whopping 75.6 percent in February to just 1.49 million troy ounces.

This compared poorly with the much (suspiciously) healthier silver coin sales of 6.107 million troy ounces the U.S. Mint saw in January, which was the best comparable coin sales result seen since August of 2011.

Rising silver prices hurt coin sales

A substantial part of the coin sales decrease in February was blamed on rallying spot silver prices, which had gained an impressive 11.3 percent over most of the month of February.

Spot silver had initially consolidated its recent gains below $34.50 during the early part of February, after setting a closing price of $33.13 on January 31st. Nevertheless, the grey metal’s price then rallied gradually to mark a close of $36.89 on February 28th.

More than half of those initial gains were erased by a sharp, single session decline on this February’s special leap day. This crash sent the spot silver market back down to close at $34.99 on the 29th, showing a more modest net gain of only 4.6 percent for the month.

Although news reports of rising silver prices can often spur smaller retail investor demand for coins, larger and savvier investors tend to prefer to wait for better levels to purchase the collectible silver coins.

U.S. mint silver coin sales adversely affected by temporary suspension

Another apparent contributing factor behind the reduced coin sales numbers was the suspension in sales of the U.S. Mint’s 2011-W Uncirculated Silver Eagle coins on February 24th at the fixed price that was set last December. The U.S. Mint also suspended sales of its five ounce 2011-P America the Beautiful uncirculated coins on the same day.

The suspensions were implemented due to the rising spot silver price and pending new product prices being published in the Federal Register, which can take several weeks.

Sales of both coins were resumed on March 6th after silver’s price spot declined as far as the $32.46 level on the day, although this downward correction came too late to contribute to February’s dismal coin sales results. – ComodityOnline

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Posted by on Mar 16 2012. Filed under Silver prices. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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