The US Mint just declared a temporary sell out of 2019 Silver Eagle Coins effective immediately February 21, 2019.
Silver coin price premiums on Silver Eagle Coins as a result are inching higher above the fluctuating silver spot price given that the US Mint was ambiguous about when new Silver Eagle Coin supplies will return to market.
How long might this latest Silver Eagle Coin sell out last?
Whom might we ask? Stay tuned for that answer at the end.
The following is the exact statement by the Branch Chief of the US Mint issued today:
February 21, 2019
2019 American Eagle Silver Bullion Coins
This is to inform you that we have temporarily sold out of our inventories of 2019-dated American Eagle Silver Bullion Coins. In addition, all remaining 2018-dated inventories have been sold too. The West Point Mint is busy producing additional 2019-dated American Eagle Silver Bullion Coins. We hope to be able to re-launch the 2019-dated coins in a few weeks.
Please let me know if you have any additional questions.
United States Mint
For seasoned silver bullion buyers, these occasional Silver Eagle Coin sell outs and supply disruptions in newly struck American Silver Eagle Coin supplies are nothing new.
Since the 2008 Financial Crisis, there have hardly been any years in which the US Mint has not had to ‘temporarily’ halt bulk silver bullion sales of new American Silver Eagle coins for various reasons.
Currently some of the largest and most easily identifiable market supply constraints for the US Mint American Silver Eagle Coin program are as follows:
- A recent uptick in Silver Eagle Coin buying.
- The ‘just in time’ delivery nature of the US Mint Bullion Coin Program.
- Silver Eagle coin planchet supplier constraints have worsened still most recently.
US Mint Sold Out of Silver Eagles: Point #1
A recent uptick in Silver Eagle Coin buying…
Only some 50 days, we are removed from one of the worst month-long performances on record, for the US stock market (both the DJIA and S&P 500 were down some -9% in December 2018 alone).
Given how both gold and silver technical and fundamental factors continue to look bullish 2020s too, we have seen a somewhat robust start to 2019 for newly struck Silver Eagle Coins sales in comparison to the last few lowering demand years.
In January 2019 alone, over $60 million USD were used in buying fresh struck 2019 American Silver Eagle Coins.
Silver Eagle Coin Sales Chart 2019
Over the last few years many secondary Silver Eagle Coins have returned from weak hand market participants, helping to dampen sales of newly struck Silver Eagle Coins.
For example in 2018, here at SD Bullion we sold more dollar volumes of secondary Silver Eagle Coins over newly struck 2018 Silver Eagle Coins. This was never the case in from our beginning years 2012 through 2015.
The following longer term chart shows US dollar flows into the US Mint Bullion Coin Program for both their most popular newly struck Gold Eagle Coins and American Silver Eagle Coins respectively.
Silver Eagle Coins Sales Chart 2009 - 2019
Many often younger long term silver bullion buyers see silver as being the better value versus gold at the moment. Yet one also must note that the generally more wealthy older baby boomer generations tend to select gold as their preferred precious metal given its less varied price volatility and value stability for retirement savings.
In general the public buys just slightly more gold and silver coins dollar for dollar (while the gold silver ratio has dipped to as low as 33 in 2011 all the way back up to the middle 80s were it is right now).
US Mint Sold Out of Silver Eagles: Point #2
The ‘just in time’ delivery nature of the US Mint Bullion Coin Program.
Often people wonder ‘How Much Gold does the US have?’ and further still, what portion of this gold is used for US Mint gold coin striking and market supplies.
Well the US Treasury’s self-reporting (with no 3rd party audits since well before the end of Federal Reserve Notes’ once convertibility to Gold bullion in 1971) alludes to the position that the US Mint Bullion Coin Program only operates with about 1% of the supposed Official Gold Reserves of the USA.
The Federal government has limited silver bullion stocks as most all its silver bullion was depleted following the end of circulating 90% silver coins in 1964. It is common sense to believe the US Military has some deep storage silver stocks for emergency military purposes, but the Federal government pretty much moved out of the silver stacking game once we went to debased cupronickel circulating coinage post-1964.
The US Mint currently depends on various silver suppliers not merely for silver bullion planchet supplies but also for price volatility hedging (i.e. going short in COMEX silver futures contracts in order to offset their ‘long’ position in silver ounces held in working silver stocks). Although the amount of silver derivative contracts traded daily on the COMEX dwarfs even annual Silver Eagle Coin sales volumes so their hedging has little effect on the silver spot prices we monitor day to day,
Likely staggered too are the amounts of US Mint employees dedicated solely to the US Mint Bullion Coin program versus other US Mint programs ongoing.
Although the US Mint does use a great deal of automation, when outsized Silver Eagle Coin demand comes about quickly due to unforeseen financial market driven events, often times the US Mint is caught flat footed.
The US Mint is consistently unable to quickly adapt and answer to its role as being the world’s most popular silver bullion product producer in overall investor sales volumes.
US Mint Sold Out of Silver Eagles: Point #3
Silver Eagle coin planchet supplier constraints have worsened recently.
Over the last few years the bullion industry has witnessed the bankruptcy of various private bullion mints due to varying circumstances.
In 2016 a once large private bullion manufacturer Northwest Territorial Mint, a former once wishful Silver Eagle coin planchet provider to the US Mint, declared bankruptcy. Details regarding their regular business practices allude to perhaps why the US Mint never engaged in bringing them on as a Silver Eagle Coin planchet supplier.
In 2017, private bullion mint Elemetal went under, details as to why revolve around dirty gold and silver refining practices.
Late last year 2018, the Republic Metals Corp. declared bankruptcy and at the time was arguably the second largest supplier of private mint struck gold and silver bullion products in the domestic USA.
Early this year 2019, Asahi Holdings won the bid to recoup their remaining precious metal refining equipment and capital for about $25.5 million USD. This winning bid perhaps now makes Asahi the largest private bullion mint hallmark operating in North America in terms of potential tonnage refining capacity moving ahead.
These various bankruptcies, lessening new line private mint bullion product demand, and industry consolidations have all put increased pressure on the remaining largest private bullion mints still serving the domestic US bullion buying and refining market.
More than likely at the moment (although it is not public record thus there is some conjecture to follow), the Sunshine Minting Inc. remains the US Mint’s main supplier of Silver Eagle planchets. Perhaps the Perth Mint’s parent company is still serving some silver planchets as well.
— James Henry Anderson (@jameshenryand) October 17, 2017
Compounding silver bullion demand constraints on the Sunshine Mint and other private silver planchet coin suppliers, are the aforementioned private bullion mint bankruptcies and the slight increase in Silver Eagle Coin sales to date (compared to the last few years of increased secondary Silver Eagle Coin supplies coming back into the bullion market compressing product price premiums).
The US Mint has and will likely continue making its difficult silver planchet supply case like it had about a decasde ago.
2019 Silver Eagle Coin Temporary Sales Suspension
When exactly this ‘temporary’ US Mint Silver Eagle Coin sell out will again end is anyone’s guess.
The US Mint often acts as if itself, is somehow completely divorced from producing bullion products for high volume retail buyers.
And it certainly does not currently operate in the spirit, originally mandated by law, to supply sufficient Gold Eagle Coins and Silver Eagle Coins to meet ongoing market demand.
For those paying attention, the original 1986 law compelling the US Mint Bullion Eagle Coin program into reality. It originally dictated that the US Mint supply efficient bullion coins to meet public US Mint bullion coin demand outright and on a continued basis.
Having failed that lawful charge in 2008 and 2009 in spectacular fashion. It was in the year 2010, then US President Obama amended this original 1986 US Mint bound law allowing the Secretary of the US Treasury full fiat or subjective determination on what amounts of Gold Eagle Coins and Silver Eagle Coins are enough for the US citizens ongoing demands.
So if you want to know when this temporary halt in 2019 American Silver Eagle coin sales will end, you can pretty much bypass the currently appointed US Mint Branch Chief cited above. The buck does not stop with him.
Just go ahead and ask Steve Mnuchin if and when 2019 Silver Eagle Coins will be back to sufficiently fulfill your demand.
And if you get the chance, ask the current Treasury Secretary which was more challenging: his robust 2017 Fort Knox gold audit or helping to plunge protect... errr reflate the US stock market following this recent 2018 Christmas eve downturn?
In other words, do not expect transparent accurate answers on any aforementioned questions by any of our currently appointed officials previously cited.
Expect bullion premiums, especially across the silver spectrum to rise in the short and potential medium term to come. Prepare accordingly.
Thanks for visiting us here at SD Bullion.