Silver Eagle Sales Hit New Record In March & Large Comex Silver Withdrawal

According to the recent update by the U.S. Mint, Silver Eagle sales hit a new record in March.  Sales of the U.S. Silver Eagle reached 4,476,000 at the end of the week.  Even though this surpassed the amount sold last year by over one million, the U.S. mint still has one final update to take place on Monday, March 31st.

Silver Eagle Update March 28 2014

If sales of the Silver Eagle top 500,000 on the last reporting day, total sales in March could surpass 5 million and overtake January as the highest monthly amount.

This would put total sales for 2014 at 13.5 million down compared to the same period last year which reached 14.2 million.  While this is a decline year over year, it was more due to allocated limits rather than a fall in demand.

The U.S. Mint didn’t begin selling the 2014’s until the end of the second week in January.  Furthermore, the Authorized Dealers purchased every allocated Silver Eagle they could for the month.  Which means they couldn’t acquire any more than the 4,775,000 shown in the table.

Even with this limitation, sales in 2014 are doing quite well as purchases in February and March were stronger than last year.  Here are the comparisons:

FEB 2013 = 3,368,500

FEB 2014 = 3,750,000

MARCH 2013 = 3,356,500

MARCH 2014 = 4,476,000 (current)

Without including Monday’s update, 2014 Feb & Mar are up 1.5 million compared to 2013.

According to the U.S. Mint, total allocated Silver Eagles for this week were 1,416,500 which would have brought the total for the month to 4.7 million.  This week, only 1,192,500 Silver Eagles were sold… which suggests the total allotment was not purchased be the Authorized Dealers.

It will be interesting to see how many Silver Eagles are sold this coming Monday and if demand remains strong in April.

The Comex has been slowly building silver inventories at its warehouse over the past several months.  However, there was a large single 1.7 million oz withdrawal from Scotia Mocatta today knocking the total warehouse level below the 180 million oz level.

Comex Silver .Inventory 32514

Lastly, some readers have brought it to my attention that the site has recently focused more on the so-called “Manipulation Theme”, rather than providing original information, facts and data on the energy, mining and precious metal industries.

I understand why some readers may feel this way.  However, I do believe there is serious manipulation taking place in the markets… I just haven’t been able to express my views on this more constructively.

I see the manipulation not as an OVERT method (while it is highly possible at times), but rather a cause-and-effect due to herding the public into highly leveraged paper assets that have no future.  I will explain this in more detail in the future.

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31 Comments on "Silver Eagle Sales Hit New Record In March & Large Comex Silver Withdrawal"

  1. I have been following your site for a while now, so thanks for the good reports!

    Just wondering if there was a way to keep track of the other world mint sales every quarter or even yearly, such as: Canadian, Austrian, Mexican, China, British, Australian, and maybe some generic mint sales like Sunshine, Silvertown, etc. We ask for more work from you for free haha

    Thanks again !

    • Matt,

      The only other Official Mint that does quarterly updates is the Royal Canadian Mint. I post updates when they publish them. We won’t know their total figures for 2013 until their 2013 Annual Report comes out in April. This will also be the same time the Q1 2014 figures will be released.

      China releases total mintage figures only. 2013 & 2014 Chinese Panda mintage figures are 8 million.

      We have to wait until the Official mints release their Annual reports to find out their total figures for the year.

      I have made several inquires to the other official mints, but did not receive a reply.

      steve

  2. I love how implied net investment demand in silver is ~150 mio oz, and 1/3 of that is ASEs alone. If you add other coins and bars, North American investment demand probably already makes up the whole 150 mio oz.

    And how much do you think the Chinese and Indians buy? I am guessing multiples of that.

    There is some serious dishoarding of silver taking place somewhere. There are supposedly no inventories, but I am betting that there actually are. Also I am betting a lot of scrap has been sold the last couple of years, and that that supply is drying up.

    I like that silver is below 20$ again. The best cure for low prices are low prices. We got to get rid of supply, and prices that bankrupt primary miners sure help.

    I am really curious how this develops however. If banks provide funding, the primary miners could continue to operate at prices that cause them losses. There are many companies today that haven’t had a positive quarter for years, and continue to survive solely on loans. So theoretically, miners, by receiving funding from zombie banks, could actually become zombie miners. Nothing is impossible in this world – no scheme too crazy or fraudulent to be implemented. So there is a possibility that this will happen, and miners would continue to put out metal at below production cost, thus continuing to aid the very price suppression that bankrupted them in the first place.

    • And another thing worth noting, on the topic of gold: Russia has increased its reserves another 7 tons in February and now stands at 1042 tonnes. China has last updated us on its gold holdings since 2009 with 1054 tons.

      So, Russia will probably overtake China in official gold holdings until summer. Let’s see how China reacts to that.

    • “So theoretically, miners, by receiving funding from zombie banks, could actually become zombie miners.”

      Shit that’s some interesting insight. That could maybe keep things in motion for awhile. then the zombie miners might have to pay in metal to the loansharks.

      I always wondered if part of the price supression scheme was to drive mines out of business, then buy them for pennies on the dollar. But making debt slaves out of them might be more productive than actually shutting them down.

  3. Names of Good Canadian Only Silver & Gold Junior mines – Publicly trade in Good Financial Position

  4. Steve- Just keep doing the fine reporting and analysis you do as you see it and, what YOU believe to be important at the time and, to your readers. Keep up the GREAT work!

  5. Implied net investment is a made up term.. I dare you to try & find it used anywhere outside PM

  6. Do we know if the bulk of those sales are domestic?

    • Rojelio,

      From what I understand, the majority are purchased in the States. Furthermore, I have heard from several sources that a significant percentage of Silver Eagle buying is coming via the Hedge Funds. I will make some calls next week to confirm this.

      steve

      • As most readers know the US Mint sells bullion coins to a relatively small number of big order buyers. Trying to recall from memory roughly twenty?? These then sell to smaller buyers like several of the PM online dealers. But these dealers, like goldsilver.com sell lots of mint boxes [“monster boxes”] and who knows how many ASE’s end up being shipped out to their final destination outside of the US.

  7. I for one look forward to your insight, and effort you put into your reports, whichever direction you come from.
    lakemike

  8. A bear market with record buying. Seriously how could somebody argue that this market isn’t totally rigged. The Gold -Silver Eagles sales ratio is 223.8 this is also very amazing.

    • German Reader,

      Apart from a few sites that serve as the markers of the extreme opposite side of the gold/silver bug side – (see here http://screwtapefiles.blogspot.ro/2014/02/normal-0-false-false-false.html for an example thereof!)…

      I don’t know of anybody in the community who is arguing that there is not ‘manipulation;’

      the question is twofold… who is it doing the manipulation?… and for what reason?

      Stever has alluded here in this piece to his awareness of this reality, and his intention to pursue it to logical ends. Irregardless of what consensus opinion demands!

      This will no doubt make EVERYONE unhappy…

      and the rest of us well served/// Onwards!

    • @GermanReader–It’s actually a little less amazing than that. If you include the gold buffalos, the ratio so far this month is 140-1. This tells you the preferences of people buying gold or silver coins from the USMint. To only compare the eagles because they share the same name makes no sense.

  9. It is interesting to look at retail availablity in Europe.

    In Europe Liberty Silver sells VAT free silver but just take a look at their stock levels:

    https://www.libertysilver.ee/en/

    Note they have only two coins, the one ounce Chinese panda on 1-2 Weeks delivery and even that is described as being “very limited mintage” and also the Australian Lunar Horse, 10oz on 1-2 weeks delivery. Everything else is either out of stock or on 3-5 weeks delivery (i.e. out of stock). 29/03/2104.
    Liberty silver have low premiums but the lead times are getting longer.

    I have noticed similar shortages in the UK. These are very variable but Sovereigns and Brittanias always seem to be available as you might expect. The Royal Mint was reported to have run out of sovereigns in January this year which may mean they ran out of gold.

    With prices low today and increasing shortages in the supply chain and the world financial system appearing to be moving beyond it’s sell by date it is not only the best time to buy but may soon be the last chance.

  10. A couple of points relative to comments made. First “zombie miners”. Virtually every corporation (except Apple and a few) worldwide is carrying a debt load that grossly exceeds the value of the company. B-school teaches to borrow to the limit because debt is “free money” coming from someone else. The cash generated you put in your (management) pocket so that when the collapse comes, you’re enjoying the beach in Grand Cayman while the bond holders join the homeless. The massive debt is deliberate, not the result of the business situation. Your money is gone but the banks are covered in the conspiracy of borrow -> pocket -> default -> GOVERNMENT BAILOUT (more of your money) -> pocket -> Continuation of the ponzi scheme requires convincing the public to abandon hard assets like silver & gold and stick to “safe” paper assets like bonds backed by nothing and stocks that aren’t worth the paper their printed on. Including mining stocks.

    Anyone that even remotely thinks these markets aren’t rigged is smoking some really powerful stuff.
    Supply/demand principles don’t apply when insiders and central banks can short sell 300 times the physical supply in paper derivatives backed by nothing and default at will. Convincing you otherwise is a critical part of the manipulation process and the mainstream media does a good job of, and profits by it.

    As far as the cost of silver. A lot of silver comes as a byproduct of mining copper, zinc and so forth. It’s the gravy on the dish so to speak and cost allocation can be very misleading. You also have to watch the tricky accounting and transfers that are done to avoid taxes. Primary mines are in countries like Mexico, Peru where slave wages are the norm. Cost of production is in the $8-9/oz range and there’s no shortage of supply. Crack the whip, hit those picks and out it comes. Protesters end up in the ground with the ore.

    Silver Eagles are required to be minted from American silver, supply of which is now trivial from a global perspective. Eagle sales exceed US mine production by about 12 million oz so that has to be filled by scrap recycle coming from within the US. Although the coins are government minted, blanks are made by contractors who don’t have the capacity to cover large short term demand swings so allocation comes from those causes.

    Overall, you’re in a situation that you have no control or influence over. It doesn’t matter how many Eagles get bought in any given month.

    • “Silver Eagles are required to be minted from American silver, supply of which is now trivial from a global perspective.”

      Not the case anymore. The U.S. Mint buys on the open market including silver mined from other countries. This was legally authorized years ago.

      “Program extension, 2002

      The authorizing legislation for the American Silver Eagle bullion program stipulated that the silver used to mint the coins be acquired from the Defense National Stockpile with the intent to deplete the stockpile’s silver holdings slowly over several years. By 2002, it became apparent that the stockpile would be depleted and that further legislation would be required for the program to continue. On June 6, 2002, Senator Harry Reid (D-Nevada) introduced bill S. 2594, “Support of American Eagle Silver Bullion Program Act,” “to authorize the Secretary of the Treasury to purchase silver on the open market when the silver stockpile is depleted.” The bill was passed by the Senate on June 21 and by the House on June 27 and signed into law (Pub.L. 107–201, 116 Stat. 736) by President Bush on July 23, 2002.[19]”

    • Michael,

      You made some excellent points on the fine art of INCREASING DEBT and MARKET RIGGING. However, you made some incorrect assumptions that I would like to address.. if you don’t mind.

      Lets explore this one first:

      As far as the cost of silver. A lot of silver comes as a byproduct of mining copper, zinc and so forth. It’s the gravy on the dish so to speak and cost allocation can be very misleading. You also have to watch the tricky accounting and transfers that are done to avoid taxes. Primary mines are in countries like Mexico, Peru where slave wages are the norm. Cost of production is in the $8-9/oz range and there’s no shortage of supply. Crack the whip, hit those picks and out it comes. Protesters end up in the ground with the ore.
      ——————

      Yes, it’s true that 71% of mined silver supply comes from by-product silver. However, I would not label it as “Gravy”. KGHM Polska Miedz” is the largest by-product silver miner on the planet. They are a large Copper miner located in Poland. They produce between 39-41 million oz of silver per year.

      According to their Q4 2013 results, we had the following:

      Q4 2013 Sales = $6,124 million PLN (polish currency)
      Q4 2013 Comp Income = $355 million PLN
      Q4 Comprehensive Income percentage of sales = 6%

      Compare this to Q4 2012 financials:

      Q4 2013 Sales = $6,806 million PLN (polish currency)
      Q4 2013 Comp Income = $649 million PLN
      Q4 Comprehensive Income percentage of sales = 10%

      As you can see, there isn’t much net income there. Furthermore, they stated a negative free cash flow for the Q4 2013 period. KGHM Polska had a very extensive Silver Hedge Book back when silver was $35 in 2012. However, this year they have totally dropped all their silver hedges.

      This means… the notion that base metal miners produce their silver for Gravy no longer holds true, especially now that the price of copper is even much lower than it was last quarter. These base metal miners need ALL THE REVENUE they can get from silver to fortify their balance sheets.

      Also, the idea that Mexico and Peru can mine silver at $8-9 an ounce is incorrect. That figure comes from the silly CASH COST industry metric that should be thrown out the window. I am not going to get into the details as this will be explained in my upcoming MINING COST REPORT.

      However, I will republish these two charts on the Oil-Silver Ratios:

      As you can see from these charts, the price of silver moved up in tandem with oil… until the Comex stepped in during 1980 and 2011 to kill investment demand. Many still believe the Hunts were responsible for pushing the price of silver up to $49. If that is true, who cornered the Oil & Gold Market? Both prices of these assets went up more than ten times their value during the 1970’s decade.

      If we look at the Silver-Oil 2000-2013 chart, we can see that silver moved up with the price of oil. Oil quadrupled from $25 in 2002 to over $110 in 2011… where it remains today. Silver went from $5 to less than $20 currently.

      So the question is… How can Mexico and Peru, or anyone else for that matter produce silver at $8-9 an ounce when the price of Energy quadrupled during the same time period? They can’t… that low cost is due to GFMS and the INDUSTRY bamboozling investors into believing that garbage.

      It is quite a shame

      Number 2:

      Silver Eagles are required to be minted from American silver, supply of which is now trivial from a global perspective. Eagle sales exceed US mine production by about 12 million oz so that has to be filled by scrap recycle coming from within the US.
      ——————

      It is no longer true that the U.S. Mint is legally obligated to use U.S. silver supply to mint its Silver Eagles. According to Senate Bill #S 2954:

      The authorizing legislation for the American Silver Eagle bullion program stipulated that the silver used to mint the coins be acquired from the Defense National Stockpile with the intent to deplete the stockpile’s silver holdings slowly over several years. By 2002, it became apparent that the stockpile would be depleted and that further legislation would be required for the program to continue. On June 6, 2002, Senator Harry Reid (D-Nevada) introduced bill S. 2594, “Support of American Eagle Silver Bullion Program Act,” “to authorize the Secretary of the Treasury to purchase silver on the open market when the silver stockpile is depleted.” The bill was passed by the Senate on June 21 and by the House on June 27 and signed into law (Pub.L. 107-201, 116 Stat. 736) by President Bush on July 23, 2002.
      ———–

      Lastly, I do believe the new monthly record sales of Silver Eagles is quite notable. We don’t see much in the way of Gold Eagle buying, but for some reason… Hedge Funds are buying a lot of Silver Eagles.

      Folks… there’s a lot of INCORRECT ASSUMPTIONS being made in the precious metal community. One of the biggest is the FALLACY OF CASH COST ACCOUNTING.

      Again, I will discuss this in more detail in my upcoming REPORTS.

      steve

        • That’s great. Steve, can you begin to cover this? You have done a lot of work on the primary miners, but the by-product side is still somewhat of a mystery to us.

          I’d of course understand if this was a topic in your paid reports.

      • Steve, have you ever thought about the impact of other forms of energy on gold and silver prices? Coal, nuclear, solar or wind? Oil and natural gas are important in the modern day economy but they are not the only forms of energy.

        • Adolf,

          Yes, I have. In a nutshell:

          1) Coal is great for burning to generate electricity. However, the U.S. Govt is trying to switch from coal to NatGas for reducing carbon emissions. This will turn out to be huge mistake. Also, Coal to liquids is possible, but very expensive and a much lower EROI.

          2) NatGas supplies will increase in the future for only a relatively short period of time. Shipping LNG is very expensive so, the best place to use natgas is on the same continent its extracted. There is this silly notion that we will put the trucking industry on Natgas. Unfortunately, we still import natgas from Canada. Like anything else, if you add demand for another industry, this puts severe pressure on present supplies that run the current system.

          This also holds true for Electric cars. Simpletons believe we can switch burning gas in our vehicles to electricity. This is a nifty idea at first glance, but we do not have the Grid capacity to power all these electric vehicles.

          3) Solar & Wind are nice localized alternatives if you want to have guaranteed power at your home. However, this alternative source of energy is a drop in the bucket compared to OIL, NATGAS & COAL. Check the energy widget on the bottom right hand of my site and you will see that Solar & Wind are a mere pittance… and will not do much for us in the future.

          Lastly, Solar and Wind projects do not pay back the initial investment over their depreciated lifespans. Only with huge government subsides plus forcing the local-regional utilities to purchase Solar or Wind power at 2-4 times the electric wholesale rate do these projects make any sense whatsoever.

          Adolf… we have run out the clock as we continue burning this very expensive short-term supply of Shale Oil & Gas likes there’s no tomorrow.

          steve

      • “So the question is… How can Mexico and Peru, or anyone else for that matter produce silver at $8-9 an ounce when the price of Energy quadrupled during the same time period? They can’t… that low cost is due to GFMS and the INDUSTRY bamboozling investors into believing that garbage.

        It is quite a shame”

        It’s even more incomprehensible when someone suggests this ON YOUR SITE, where one of the main topics you cover is that cash cost is NOT the real cost of producing silver.

      • You’re making an incorrect assumption that energy = cost of production. The major component of primary production is labor and the major producing countries have wages below what old plantation slaves worked for. What large users pay for energy is not what you see in the “spot market” price, your utility bill or any report that you have access to. Electrolytic operations, like metal refiners, are using energy priced as low as $0.005/kwh. Did you know that? Remember government? And, energy is not just oil.

        Like the Mafia, corporations have 3 sets of books. The first is “Operations”. That’s the real deal, top secret, restricted to top management. The second is “Shareholder”. Those are cooked to present the rosiest picture possible without revealing any truth about what’s really going on. That’s what you see. The third is “Tax”. Those are manipulated to avoid paying taxes. Examples. No oil company has ever made a tax basis profit since JDR started the Standard Oil monopoly over a century ago. Companies reporting record earnings declaring total bankruptcy within a month after the report. Remember Enron?

        Once fixed costs are covered, cash cost is the key parameter. If fixed costs are not covered, the operation shuts down and goes out of the picture. That doesn’t mean that every company has the same cost. That they are operating is conclusive proof that everyone’s cost is below the $18-20/oz level regardless of basis and the spread on high-low is around 2:1 so there are major producers in the $8-9/oz range. You’ll never know the actual for any of them (see para 2) but that’s irrelevant from a global perspective.

        Your silver-oil relation derives off the “safe haven” or “fear” (both terms incorrect) investment strategies whereby gold-silver-oil all go in tandem from the standpoint of certain paper trades and derivatives. Why, for example, do all the major price moves happen at exactly 10AM New York time? If you haven’t noticed, it’s true. So, you can’t say the paper markets are manipulated (which they are) and then use as the basis of your chart that they are not. You’re showing the same thing with 2 different labels. In terms of end use, G-S-O have no relationship to each other. And, silver is not a byproduct of oil. Same comparing the price of corn to the price of copper which has been in the media lately. Do you think their related?

        Past history is no indication of future events. There was a time when a pound of salt was worth 20 pounds of silver. Checked out the price of tulip bulbs lately? Condos in Las Vegas? Facebook shares? Emotion and greed drive the masses and preying on them is the path to riches. That never changes! That’s why quantitative analysis, like you’re doing, doesn’t predict the outcome.

        Good to see so much discussion on this article. More than the Ukraine situation and more intelligent. Nice talking to all of you.

  11. Why no mention of record low SAE premiums. $2.39 over spot on one major dealer & 2.49 on others. If we were in a true shortage/damand as in the past you would see premiums rising,not declining..

    Please explain why the record low premiums are happening.

  12. Hi Steve,
    I really like your work, so keep it up, it’s greatly appreciated. I just made a quick calculation and found that annualized, at the current rate of sales, this would amount to about 52 million ounces or ~1600 metric tonnes of silver per annum. This is still a rather small amount in a global market of ~1 billion ounces or ~ 31000 metric tonnes per year. The bulk of silver is still used up by industrial usage (the bulk on the demand side for physical silver), and even though I’m a big fan of silver, I fear that with SLV (official) inventories still in the 9000-10000 metric tonnes range, any economic contraction might bode badly for the short- and mid-term silver price, or rather a buying opportunity for long-term investors that have a good stomach, if they decide to take this bumpy roller-coaster road.

    • CHX,

      I understand your argument on the short term price moves in silver. I have always stated that owning the precious metals was a LONG-TERM COMMITMENT. I do not believe in the present INSANE TRADING MENTALITY of the market today.

      Some mention, there is no silver shortage… I agree. Why would anyone believe there is a shortage. Even though the silver eagle buying is a small percentage of overall supply… the more important thing to note is the continued record purchases. Someone thinks its a good buy.

      Americans have been contributing to their 401k’s for decades. They put so much in their retirement account each month. This is how I look at the precious metals.

      Individuals who bicker about present premiums, supply-demand and economic conditions fail to realize the coming ENERGY CRISIS.

      I am a BROKEN RECORD here, but the peak of global oil production, the falling EROI and the declining net oil exports will put severe pressure on most paper and physical assets. This is when the values of gold and silver will be realized. Of course, any financial black swans can speed that process up.

      steve

  13. 180 million oz equals 5598 tons. Annual supply is slightly above 1000 million oz which equals roughly 32600 tons. So the Comex holds only about a sixth of an annual supply. Pretty damn little. According to the Silver Institute supply & demand figures, total annual demand equals total annual supply, so if Comex holds only a sixth, i wonder who sells the rest?

  14. Where is 2014? Can 2014 explain why the silver market isn’t manipulated. If the bankers can manipulate the massive LIBOR market then why can they not manipulate the silver market? The silver market is a peon compared to the LIBOR market.

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