Silver coin shortages, again research uk to us dollars


The announcement on Tuesday by the US Mint that it had sold out of silver Eagle bullion coins due to a “significant” increase in demand with no orders being taken until August and possible rationing thereafter has resulted in a surge in coin premiums.

Kitco reported that premiums “have already posted a 50% increase and pressure for further premium adjustments is expected” as “physical demand for all silver products has soared over the past two days.” USAGOLD had already been experiencing strong demand over the past two weeks but “today’s [Tuesday’s] price drop has encouraged another wave of interest.” Gainesville Coins said they were “BUYING American Silver Eagles for more today than we were SELLING them for yesterday!”

Silver Doctors has the best summary of the current state of supply and premiums in this post, with 90% junk bags at up to $3.00, Silver Eagles as high as $3.25 (wholesale), a doubling of premiums on silver rounds and bars, and expectations that the Royal Canadian Mint will soon announce a premium hike.

Silver Doctors feel that “if any further weakness materializes in the paper futures markets for gold and silver, we are looking at the very real potential of 2008 style physical premiums to acquire precious metals.” To put that statement in context, consider the chart below from with the current premium increases circled in red.

The current premiums are moving into the 20% of spot range but you can see we have far to go to reach 2008 levels. It is hard to read whether this shortage will be sustained, as the US Mint has not indicated how its blank suppliers are placed and what sort of orders it already had in the pipeline.

Unlike The Perth Mint, the US Mint does not manufacture its own blanks, instead sourcing them from others like the Sunshine Mint and The Perth Mint usd cad analysis. The US Mint used to produce its own blanks but Edmund Moy, former Director of the US Mint‏, explains that the decision to stop making its own blanks was “part of the Reagan outsourcing of non-value added to the private sector usd gbp rate. Mint’s value added is stamping.”

The outsourcing of blank manufacture is not really the issue as whether one has to source 1000oz bars or blanks, it comes down to forecasting demand and having enough silver bars/blanks in stock to get you over any demand surges. Forecasting can be tricky as demand responds to price and if anyone knew where the price was going with any certainty, they wouldn’t be wasting their time making coins and instead be a hugely profitable speculative trader.

In the case of The Perth Mint, we have good supply of raw silver from our refining operations and plenty in stock. At this stage we have not seen any demand surge out of the US but we would expect that if the shortage continues beyond a few weeks but we are seeing good pick in demand out of Europe for our silver kilo coins usd myr chart. We have recently invested in upgrades to our blank production line which should be operational in a month so are confident of being able to meet increased silver demand.

Some commentators are playing up this US Mint shortage as evidence of a shortage of raw silver but they are getting confused between a shortage of blanks versus a shortage of raw silver euronews online russian. I’ve covered such confusion in my personal blog in the past, see here and one also has to be careful not to confuse production capacity shortages (which I have argued are a real problem if we get mass market demand) with raw silver shortages.

There is some truth is what you say, I certainly think that over the past few years with retail demand being down that everyone in the distribution chain has probably lightened up on inventory levels.

I should have pointed out that Nick’s chart, while in percentage, silver coins are sold at fixed $ per ounce. Part of the reason the percentages in the chart fall to 10% is because the silver price was high, so don’t read the chart too much like coin dealer $ margins had fallen. The reason Nick did it in percentages is that gold coins are sold as percentage of metal so it makes silver coins comparable to gold and also does help make it comparable over time.

This is so tedious convert binary to decimal. Mint shortages are caused only by blank shortages you say djia futures marketwatch. You know how long this has been going on. In any natural market, manufacturing capacity adjusts to enable transformation of raw material into finished product so that demand is matched with supply troy isd. Absolutely there is a shortage of raw material silver. If the housing market were booming, and the timber was available for conversion into lumber but sawmills were of inadequate capacity, the market would add sawmill capacity. Silver blanks are no different in that sense than lumber msn news usa english. There is a silver shortage which is why Dow Chemical, Du Pont, Ferro Corporation and Tiffany & Co. recently abandoned their long term memberships in the Silver Users Association. They hope to sidestep scandal when the blowup transpires love quotes tagalog. The short profile in COMEX silver is a billboard that someone fears a higher silver price more than they fear the grave. I will consider it an Act of God if this post is allowed to stand.

I have posted previously on why the minting industry has not invested in extra capacity, one of the big issues is that precious metal demand is entirely price driven, so a business decision to invest in extra capacity and thus incur fixed depreciation costs is a bet on sustained demand. The volatility of prices means this is a risky business decision and hence why I think minters and blank manufacturers err on the side of caution.

and and for more detail.

Not necessarily. In the past generally Western demand increased with the price going up and Eastern buyers were a bit more canny, buying on dips. But recent market behaviour is a lot more erratic, currently demand is down out of China while we are seeing silver coin demand up on a price drop crossword puzzle usa today. This is what makes it so hard to forecast.