by Louis Golino for CoinWeek ………
Update on U.S. Mint Price Increases
On March 5 the U.S. Mint’s Michael White, who serves in the Mint’s Office of Public Affairs, provided some clarification regarding the issues discussed in my last column , which concerned the recent increase in premiums on gold and platinum numismatic coins at a time of declining precious metal prices.
He noted that non-metal costs at the Mint, such as labor and other costs, have indeed been rising recently, and that they played a role in the price increases. Additional details on which specific costs have risen will be provided later.
In addition, “weaker consumer demand,” as a result of “discretionary budgets being squeezed,” mean the Mint is selling fewer units of its precious metal products.
Perhaps most importantly, Mr. White explained that the Mint “generally reprices coins so that the entire portfolio recovers its cost,” and added that they need “some margin to cushion against volatility” in precious metal prices.
Looking forward, he said that Mint officials hope they can keep price increases to a minimum.
For those readers and collectors who have speculated that the Mint is seeking to model itself or its pricing structure on certain foreign mints that charge very high premiums over melt value, as I discussed last time, Mr. White confirmed that the Mint has no plans to do anything like that.
Besides, its silver numismatic coins are still priced competitively compared to those of most foreign mints. For example, even at $245, which is the expected price of the 2013 uncirculated versions of the five-ounce silver America the Beautiful coins, the U.S. Mint’s prices will be roughly half those of the Perth and Canadian mint’s five ounce silver coins, which generally sell for around $500, although that is sometimes for proof or reverse proof coins that have slightly higher production costs and in the case of Canadian coins, often includes attractive wood display cases.
As far as the impact of the U.S. Mint’s new prices, particularly on gold and platinum coins, on sales levels, it is really too soon to say. In addition, at the moment the only gold coins available are the First Spouse coins, and the only platinum coin is the 2012 American platinum eagle.
The most recent sales report from the Mint, which was released on March 5, mainly reflects increased sales for the spouse coins, as buyers sought to purchase their coins before the implementation of the new, higher prices last Wednesday, February 27. We will have to see what happens in the coming weeks and months before it is clear whether the higher prices are dampening overall sales.
Girl Scouts of the USA silver dollars
Last week the Mint also began taking orders for the Girl Scouts of the USA centennial commemorative silver dollars. Sales for the first week came in at about 11% of the total maximum authorized mintage of 350,000 coins, including 29,331 proof and 12,293 uncirculated coins sold during that period. Those figures are comparable to opening sales for last year’s Infantry silver dollars.
Unless a lot of non-collectors, such as girl scouts and former girl scouts, purchase the coin, sales for the GSUSA coin may run on the low side, though it is too soon to say for sure. That is because coin collecting is still a male-dominated field, even if that is changing, and as I have discussed before, some male modern coin collectors have less than enlightened views on women. They say, for example, that Girl Scouts got their coin already because they were included on the 2010 Boy Scouts centennial silver dollar, a reference to the inclusion of a female Venturer on the coin,
which many collectors continue to view as a politically correct move. I have also read many online comments from collectors who describe the coins as ugly or even repulsive, which is really a beyond-the-pale kind of view that is unfortunately too common. I respect peoples' right to their own views, but seriously, is "repulsive" a word one would use to describe the coin?
Plus, as I explained last year, the history of the two organizations is deeply intertwined, and besides, if it is appropriate to celebrate the 100th anniversary of the Boy Scouts, why not the 100th anniversary of the Girl Scouts? Is that really political correctness, as many male collectors claim, or rather, is it not an appropriate way to honor the tens of millions of American women and girls who are current or former Girl Scouts?
In addition, as the CEO of the GSUSA, Anna Chavez, explained in my interview with her last year , Girl Scouts are natural collectors, and many of them are interested in numismatics, so they may end up purchasing lots of the coins.
American palladium eagle study
In other news regarding the U.S. Mint, the long-awaited report from Mint on the feasibility of minting American palladium eagles is due to be delivered this week to the Senate Banking Committee and the House Committee on Financial Services.
The coins were authorized with the American Palladium Eagle Bullion Coin Act of 2010 (Public Law 111-303), but in order for the coins to be issued, the Mint has to first demonstrate that there is sufficient demand for the coins. From my own communications with fellow collectors, I have little doubt that the coins will be very popular and will sell well.
The Mint contracted the CPM Group to prepare the feasibility study, which the Mint received last year. After reviewing and analyzing those results, the Mint prepared the final report, which is the one being delivered to the Congress this week. I will try to obtain a copy of the study and will report on its findings.
If the study provides support for issuance of the bullion coin, it has to be minted within twelve months of the issuance of the report. Only a bullion version is required by law. At its discretion the Mint may issue a proof version for collectors. The legislation also has an unusual provision that states that if collector versions are issued, each year’s coin is supposed to have “a materially different finish” from the previous year’s coin. But there are only so many finishes available, so it will be interesting to see how that works out, if the coins are issued for a number of years.
America the Beautiful Five-Ounce Silver Coins delayed
Collectors of these coins have been eagerly awaiting information on the release of the 2013 coins.
Their release had been expected to begin earlier in the year, but they were delayed, and product release dates were removed from the Mint’s web site.
I contacted the Mint and was told that the reason is that the Mint is still in the process of determining mintage levels for both the uncirculated collector versions and the bullion coins.
Last year’s collector versions have been selling out one after another in recent weeks, and at the moment only the Chaco Culture and El Yunque coins remain available for sale, and the latter coin has been backordered, which is generally a sign that the coin is close to selling out.
The Hawaiian Volcanoes coin sold out unexpectedly, and quickly tripled in price to $600 on the secondary market. The other sold-out coins quickly reached the $400 level. Approximately 15,000 of each of the 2012 coins appear to have been minted, which is lower than any previous year’s coins.
Louis Golino is a coin collector and numismatic writer, whose articles on coins have appeared in Coin World, Numismatic News, and a number of different coin web sites. His column for CoinWeek, “The Coin Analyst,” covers U.S. and world coins and precious metals. He collects U.S. and European coins and is a member of the ANA, PCGS, NGC, and CAC. He has also worked for the U.S. Library of Congress and has been a syndicated columnist and news analyst on international affairs for a wide variety of newspapers and web sites.