Is The US Mint Under Reporting Silver Eagle Sales?
Sales of 2016 Silver Eagles EXPLODED this week, coming in at 1,405,000 coins as reported by the US Mint, bringing Year to Date Sales to 31,980,500.
Due to SD Bullion’s industry sources and contacts however, the US Mint’s official Silver Eagles numbers appear to be SUSPECT.
We spoke with the CEO and Head of the Trading Desk at 2 of the APs (Authorized Purchasers), who advised us they had sold through their ASE stockpiles, and ordered full truck-loads of 560,00 and 400,000 Silver Eagles respectively this week (as of Thursday).
This means that in order for the Mint’s numbers to be accurate, the rest of the US Mint AP’s COMBINED (which includes the largest retail bullion dealer as well as the largest wholesale AP in CNT) would have had to have ordered less than 500,000 coins combined, or roughly 50,000 per AP. (Keep in mind that one of the 2 AP’s who provided SD Bullion their numbers is one of the smallest 3 US Mint AP’s by sales volume).
Combine this with the fact that SD Bullion itself burned through more than 50,000 Silver Eagles over the past 4 days, we are somewhat suspicious of the US Mint’s official sales numbers for the week.
The Sunshine Mint sold through a MONTH’S worth of production on Sunshine 1 oz Walking Liberty rounds on Tuesday alone, and by Thursday, most private mints were reporting 1 -2 week delays on new orders for ALL private mint silver bullion products.
Whether a true retail shortage begins to develop and appear will likely be determined by how the paper markets trade next week when China returns from holiday.
If silver remains at a $17 handle (let alone is hit again to a $16 handle), we expect retail tightness to emerge at some point over the next week. If the metals bounce strongly early next week, physical bullion demand is expected to cool off enough to keep metal reasonably available.