American Eagle Silver Coins Sold Out as Demand Jumps
By Debarati Roy
The U.S. Mint ran out of American Eagle silver coins after selling 1.26 million ounces since the start of the month as futures in New York slumped to the lowest in more than four years.
“Due to the tremendous demand we have experienced in the last several weeks, the U.S. Mint has temporarily sold out,” Michael White, a spokesman, said in an e-mail yesterday. The Royal Canadian Mint also said demand was up “significantly.”
In October, U.S. Mint sales jumped 40 percent to 5.79 million ounces from a month earlier to the highest since the record in January 2013. Futures dropped 1.2 percent to $15.26 an ounce on the Comex at 7:09 a.m. in New York. The contracts tumbled to $15.12 yesterday, the lowest since February 2010.
Assets in exchange-traded products backed by silver rose to a record last month, defying a slump in gold ETP holdings to the smallest since 2009.
Effect of recession on availability, 2008–2010
As a result of the global recession, the demand from investors for bullion coins as a hedge against inflation and economic downturn surged. This increased demand began to affect the availability of American Silver Eagle bullion coins in February 2008 when sales to authorized dealers were suspended temporarily. In March 2008, sales increased ninefold from the month before (from 200,000 to 1,855,000). In April 2008, the United States Mint began an allocation program, effectively rationing Silver Eagle bullion coins to authorized dealers on a weekly basis due to “unprecedented demand.” At least one observer has questioned the legality of the allocation program, as the Treasurer of the United States is required by law (31 U.S.C. § 5112(e)) to mint and issue these coins “in quantities sufficient to meet public demand.” On June 6, 2008, the Mint announced that all incoming silver planchets were being used to produce only bullion issues of the Silver Eagle and not proof or uncirculated collectible issues. The 2008 Proof Silver Eagle became unavailable for purchase from the United States Mint in August 2008 and the 2008 Uncirculated Silver Eagle sold out in January 2009 (however, it was available as part of the “2008 Annual Uncirculated Dollar Coin Set” until it sold out on January 28, 2010).
On March 5, 2009, the United States Mint announced that the proof and uncirculated versions of the Silver Eagle coin for that year were temporarily suspended due to continuing high demand for the bullion version. The allocation program that had been put in place in March 2008 was lifted on June 15, 2009, leading to speculation that proof and uncirculated versions might be produced before the end of the year. However, on October 6, 2009, the Mint announced that the collectible versions of the Silver Eagle coin would not be produced for 2009. The disappointment of collectors was expressed in a December 1 article by Representative Gary C. Peters (D-Michigan). Peters offered alternative scenarios to the cancellation of 2009 proof and uncirculated Silver Eagles and explained that he would be sending a letter to Mint Director Edmund C. Moy urging him to begin minting these products as soon as possible and continuing to do so until the end of the year. This effort was not successful and the collectible versions were not produced. The sale of 2009 Silver Eagle bullion coins was suspended from November 24 to December 6 and the allocation program was re-instituted on December 7; the product sold out on January 12, 2010.
Production of the 2010 Silver Eagle bullion coins began in January of that year (as opposed to beginning typically in December preceding the year of issue) and the coins were distributed to authorized dealers under an allocation program until September 3.
On July 20, 2010, Mint Director Edmund C. Moy provided testimony to the House Subcommittee on Domestic Monetary Policy and Technology on the matter of proof and uncirculated Silver Eagle coins, referencing the possibility of a legislative solution. Moy explained:
“Because we could not produce these popular coin products, those who had become accustomed to purchasing them on an annual basis were very disappointed. As Director of the United States Mint, I appreciate the disappointment of these collectors, but I am encouraged to know that the Subcommittee is exploring the possibility of an amendment to the law that would afford the Secretary the authority to approve the minting and issuance of American Eagle Silver Proof and Uncirculated Coins even when we are unable to meet the public’s demand for the bullion versions of these coins. American Eagle coin collectors and our many other customers who purchase these products as gifts would likely welcome such a change. Indeed, such a change would be one of the most positive customer satisfaction measures that could be taken to benefit your coin collecting constituents without having an effect on American’s [sic] ability to acquire investment-grade silver bullion. We have already provided you technical drafting assistance that your staff have requested to accomplish this change; however, such a change needs to be enacted soon. We can mint 200,000 per month, and if we can begin by September, we will be able to produce about 830,000 one-ounce silver American Eagle coins to meet collector demand for this product in the remaining months of 2010.”
— Edmund C. Moy, Testimony of Edmund C. Moy, Director United States Mint, Before the Subcommittee on Domestic Monetary Policy and Technology, United States House of Representatives, July 20, 2010
On September 22, 2010, Representative Melvin L. Watt (D-North Carolina) introduced the “Coin Modernization, Oversight, and Continuity Act of 2010” (H.R. 6162) to amend 31 U.S.C. § 5112 (e) and (i) by giving the Secretary of the Treasury authority to mint American Eagle silver and gold coins in “qualities [e.g. bullion, proof, or uncirculated] and quantities” sufficient to meet public demand. The bill was signed into law (Pub.L. 111–302) by President Barack Obama on December 14, 2010.
On October 4, 2010, the Mint announced that 2010-dated proof American Silver Eagle coins would be available for purchase beginning on November 19, 2010, at a price of $45.95 per coin and that 2010-dated uncirculated Silver Eagle coins would not be produced.
2013 allocation program
In January 2013, the Mint suspended sales of American Silver Eagle bullion coins after the first week due to high demand. The Mint resumed the allocation program that had been implemented from 2008 to 2010.
|2006-P Rev. Pr.||–||248,875||–||248,875|
|2009||30,459,000||Not offered||Not offered||30,459,000|
|2011-P Rev. Pr.||–||99,882||–||99,882|
|2012-S Rev. Pr.||–||224,935||–||224,935|
- Bullion, 1986–2011: “Final Figures for American Eagle Bullion (in pieces)”. United States Mint. Archived from the original on 5 June 2011. Retrieved April 23, 2011.
- Bullion, 2012: “Silver Eagle Mintage”. Silver Eagle Guide. Retrieved July 2, 2013.
- Proof and uncirculated, 1986–2012: “Silver Eagle Mintage”. Silver Eagle Guide. Retrieved February 24, 2014.