The bullion or investment coins in gold and silver are a very appropriate formula to start investing in precious metals, with a moderate capital. We have already explained its advantages in several posts on this blog. Some advantages that have been taken into account by investors who, in view of the economic crisis derived from the Covid-19 pandemic, have exhausted the stocks of these currencies in recent months. The latest sales data from the main mints are revealing.
As we have explained in previous posts on this blog, bullions or investment coins in precious metals (mainly gold and silver, but also platinum and palladium) are pieces that are intended, as their name suggests, to serve as an investment object. In other words, what is important in them is the quantity and purity of the precious metal they contain, rather than their numismatic value.
The wide variety of sizes offered to investors, from 1/50 of an ounce to one, two or even five ounces , allow us to cover a wide range of potential clients, interested in keeping their money safe from the vicissitudes of the current economy.
Therefore, it is not surprising that since the confinement measures were issued to contain the Covid-19 pandemic and the tremendous setback that the world economy was going to suffer began to glimpse, these currencies became fashionable among investors.
Us Mint Sales
The sales data has been spectacular. For example, the United States Mint , which mints the well-known American Eagle bullion, broke its sales records last March.
Thus, American Eagles gold sales rose to 142,000 ounces, a figure that ridicules the 7,000 ounces sold in the month of February and which represents an increase of no less than 1,928.6%.
These 142,000 ounces of gold also represent an increase of 1,134.8% compared to the 11,500 that were sold in March 2019.
In total, during the first quarter of the year, the US Mint has sold 209,000 ounces of gold American Eagles, 132.2% more than in the first quarter of last year.
The silver American Eagles have not been far behind either. The US Mint sold 4,832,500 ounces in March, 643.5% more than the 650,000 sold in February, and 468.5% more than the 850,000 sold in March 2019.
The accumulated figure for the first quarter of the year rises to 9,328,500 ounces, 34.7% more than in the same period last year.
The US Mint also mints a version of the American Eagle in platinum , a metal that is becoming increasingly popular for bullion minting. The figures for platinum American Eagles have also been record: 6,200 ounces, compared to 4,000 in March last year (+55%).
Sales Perth Mint
For its part, the Perth Mint , the Australian mint that mints such popular bullions as the Kangaroo, the Koala or the Kookaburra, has also seen a huge increase in its sales during the first weeks of confinement.
Thus, its sales of gold products (including bars and investment coins) rose to 93,775 ounces in March, which is the highest amount since April 2013.
In silver, its sales reached the figure of 1,736,409 ounces, which practically triples the 605,634 ounces that were sold in the month of February.
The trend has continued in April, with sales of 120,504 ounces of gold and 2,123,121 of silver, which represents an increase of 134.3% compared to April 2019.
The analysis of Richard Hayes, CEO of the Perth Mint (in the image) , on this increase in bullion sales is illuminating:
“The specific factors that have contributed to this increase in demand in the midst of the Covid-19 epidemic have to do with theories of a lack of supply of precious metals due to the closure of refineries, which raised concerns about a possible restriction of the market. physical” .
Indeed, several of the largest precious metals refineries in the world (such as the Swiss Valcambi, Argor-Heraeus and PAMP ) were forced to close their doors temporarily.
Added to this were the restrictions suffered by some mints such as West Point (USA), which reduced the production of investment coins in gold and silver.
This, together with a considerable increase in the demand for investment coins by private investors, meant that, since mid-March, specialized stores ran out of gold and silver bullion stock .
One of the main effects triggered by this shortage was the rise in the premiums paid for the coins that came onto the market.
It must be explained that the price of investment coins is given by the spot price of the precious metal in which it is minted at the time of sale, plus a small supplement (usually between 2.5 and 3% ), which covers the costs of minting, production and distribution.
Obviously, it is an economic law: a product that has registered a notable increase in demand and restrictions in its production, ends up raising its price.