Continuing Gold Coin Shortage

Production of United States Mint American Eagle Gold Coins has been suspended because of unprecedented demand. Currently, all available 22-karat gold blanks are being allocated to the American Eagle Gold Bullion Coin Program, as the United States Mint is required by Public Law 99-185 to produce these coins “in quantities sufficient to meet public demand.” According to the United States Mint, they “will resume the American Eagle Gold Proof and Uncirculated Coin Programs once sufficient inventories of gold bullion blanks can be acquired to meet market demand for all three American Eagle Gold Coin products. Additionally, as a result of the recent numismatic product portfolio analysis, fractional sizes of American Eagle Gold Uncirculated Coins will no longer be produced.” This continued, sustained demand for American Eagle Gold Bullion Coins caused a suspension of 2009-dated American Eagle Gold Proof Coins as well. With confidence in paper currencies plummeting around the world, gold in all forms is being acquired by investors. The American

Eagle Gold coin has benefited from this demand, booking the highest sales in 11 years. The U.S. Mint reported selling approximately 190,000 American Eagle Gold coins in May. The same is true overseas. Mints from around the world have said pursuit for gold coins has risen substantially. The demand has been strong internationally, with rising sales reported in the United States, Russia and Austria. German gold coin sellers ran out of product in one day. Britain’s bullion dealers are struggling to source enough gold Sovereign and Britannia coins to keep up with surging demand.

A significant number of British investors are buying coins as a store of wealth. UK Dealers are reporting a backlog of orders for bullion coins recognized as UK legal tender, which are exempt from tax. The supply situation is worse from European sources. Gold is in high demand in Europe as investors there seek amid fears over sovereign debt problems in the eurozone, meaning fewer coins are coming back to market. European buyers accounted for 69% of purchases last month,

compared with 51% a year ago, according to the Perth Mint. Rand Refinery said output at the end of May jumped 50% to 30,000 ounces of blank coins for minting, the highest weekly production since 1985. Demand was strong enough to constitute “panic buying,” Muenze Osterreich AG, the Austrian mint that makes the Philharmonic coin, said on May 12. “Buy orders are coming from wealthy and high-net-worth clients, so the increased buying is not from the man in the street,” GoldCore said in a recent report. The broker said

it has a minimum purchase order of $10,000. A South African Krugerrand weighing 1 ounce costs $1,360 with gold at $1,234, according to GoldCore’s website. Krugerrands are the world’s most widely held

and actively traded gold coin.

In the United States, the U.S. American Eagle Gold is the bullion coin of choice.