American Silver Eagle bullion coins are off to an amazing start this year with January 2011 sales shattering the all-time monthly record, according to the most recent figures released by the United States Mint.
In total, the US Mint recorded 6,422,000 of the one ounce Silver Eagles being ordered by its network of authorized purchasers during January. This easily surpassed the previous monthly record set just last November by over 50%. Sales that month came in at a then very impressive 4,260,000.
Declining silver prices may be the biggest factor responsible in the large number of Silver Eagle bullion coins sold. The precious metal ended January nearly $3 an ounce lower than where it began the month. The London Fix for silver finished at $27.75 an ounce for January, down from its high of $30.67 an ounce on January 4.
Anyone familiar with the bullion market knows that American Silver Eagle sales have been nothing but astounding for the last few years. Demand for the .999 fine silver bullion coins advanced in 2008 through to the present, giving few retreats along the way as investors sought physical silver as a tangible option to their portfolios.
This dramatic increase in the number of coins sold caused considerable trouble for both the US Mint as well as collectors. Facing a legal requirement to strike the bullion Silver Eagle to meet demand, the US Mint pulled the 2008 proof version of the coin (which it strikes for collectors) early in that year to divert all available blank planchets towards bullion production. With record demand continuing into 2009, the US Mint cancelled the 2009 Proof Silver Eagle altogether.
The US Mint was able to accomplish a return to the proof last year owing to an increase in the blank planchet supply, not because investors were ordering fewer bullion coins. As the chart below indicates seven of the top ten all-time best months for the bullion Silver Eagle occurred during 2010, only to be dwarfed by the sales of January 2011.
Top Ten Silver Eagle Monthly Sales
|
1
|
January 2011
|
6,422,000 |
|
2
|
November 2010
|
4,260,000 |
|
3
|
December 1986
|
3,696,000 |
|
4
|
May 2010
|
3,636,500 |
|
5
|
January 2010
|
3,592,500 |
|
6
|
March 2010
|
3,381,000 |
|
7
|
October 2010
|
3,150,000 |
|
8
|
March 2009
|
3,132,000 |
|
9
|
June 2010
|
3,001,000 |
|
10
|
July 2010
|
2,981,000 |
All the monthly highs last year accumulated to an annual record for the coins.
Whether or not this sales trend will continue is uncertain. What is known is the fact that with just one month completed, 2011 already ranks as the 16th best year ever for the coins since they were first being introduced over a quarter of a century ago in 1986. In fact, the sales would only need to double for 2011 to become the fourth best annual record holder — a feat it should easily accomplish given that eleven months remain in the year.
The sales of the silver by the Mint is jaw dropping really. I can’t help but wonder at the push behind those purchases in this economy. Throw into the mix the metals demand out of China and things are heating up.