Gold News

Q3 US Silver Coin Sales Eat 1 Month of World's Top Mining Output

India silver buying "astonishing" too, but US sales only half 2011 peak by value...
 
THIRD QUARTER sales of silver Eagle coins by the US Mint were larger than a whole month's output from Mexico, the world's No.1 silver mining nation.
 
Data on the US Mint's website say it sold more than 443 tonnes of silver coins to retail dealers between end-June and end-September.
 
World No.1 silver mining nation Mexico produced 424 tonnes in July, the government's Instituto Nacional de Estadística y Geografía (INEGI) said this week – a rise of nearly 10% from the same month last year.
 
Rising by almost one-half from Q2 this year, the US Mint's silver coin sales in Q3 were its largest quarterly total by weight since at least 1986, when current records began.
 
At this pace, the Mint's full-year 2015 silver coin sales to distributors are on track to beat 2013, when a sharp drop in prices saw retail investment demand jump.
 
By value however, and with silver prices averaging $16.01 per ounce so far this year, 2015's sales would equal only 50% of 2011, when the Mint sold silver Eagles worth some $1.5 billion at spot prices.
 
"There seems to be a bit of frenzy" amongst US and other silver coin buyers, Reuters quotes Neil Vance, a manager at the Perth Mint in Australia, "[because] people think there is a shortage of silver.
 
"But in fact it is [in] manufacturing capacity."
 
The tight availability of retail investment products in the US – typically sold at 30% or more above spot wholesale silver prices – is drawing in coins from overseas mints according to distributor MTB in New York, including Austria and the UK's Royal Mint, something the company's vice president of sales, Roy Friedman, says he hasn't seen happening to this extent before.
 
Alongside the surge in US silver investment demand meantime, demand in India – traditionally the world's No.1 gold buying nation – "is nothing short of astonishing," says specialist consultancy Metals Focus.
 
August alone saw India import some 900 tonnes of silver bullion, Metals Focus reports, taking total imports since the price began turning sharply lower at the start of 2013 to around 17,000 tonnes.
 
"Even though this also captures a period of much improved jewellery and silverware demand," Metals Focus wrote in a recent note, "the key driver of this has been the growth in retail investor buying."

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