After initially being released in a frenzied atmosphere which prompted articles in mainstream publications and unprecedented price and distribution requirements, the America the Beautiful Five Ounce Silver Coins have experienced a swift change in collector sentiment.
Bullion Coin Program
The program underwent an extremely rocky start as the United States Mint had difficulty achieving the unusual requirements specified by Congress. Most troublesome were the requirements for a 3 inch diameter, which made the coins unusually thin, and the incused edge lettering, which initially caused the coins to crumple when applied.
The US Mint purchased a special coining press from Germany at a cost of $2.2 million, which was installed at the Philadelphia Mint on March 1, 2010. An extended period of testing followed, with the first full scale production beginning more than six months later on September 21, 2010. The extreme delay and reported production problems seemed to increase collector anticipation for the coins.
On December 1, 2010, the Mint finally announced that the bullion coins would be available on December 6, 2010, with only 33,000 units for each of the designs available. This was about one-fifth of the level that the US Mint had initially intended to produce. Additionally, the Mint announced that numismatic versions would be available in the following year, with 27,000 units for each design available. The unexpectedly low mintage levels only served to increase collector interest in the coins.
The release of the bullion coins did not go as planned. The authorizing legislation specifically requires the US Mint to distribute the bullion coins through their authorized purchaser network, which consists of eleven primary distributors who can purchase bullion based on the market price of the metal plus a mark up. In the case of the America the Beautiful Silver Bullion Coins, the price was based on the market price of silver plus $9.75 per coin. One of the distributors began offering the coins for sale to the public for significantly higher prices. Collectors complained, prompting the Mint to halt the program to determine an appropriate course of action.
The program was relaunched on December 10, 2010, and authorized purchasers were required to enforce a limit of one coin for each design per household and not charge any more than 10% above their acquisition cost. Most of the authorized purchasers agreed to the terms and purchased their allocations, although many were extremely slow to sell their coins to the public. The constraint on the supply combined with the now frenzied interest led to high prices for the coins which did reach the market.
In the following year, the first two designs were made available to authorized purchasers in bullion format on April 25, 2011, with an initial mintage of 126,700 indicated. In less than a month, authorized purchasers had ordered the entire quantity for both designs. Sales began to slow by the fourth release of the year, as apparently interest in the oversized bullion coins had dissipated. The most recent release featuring Chickasaw National Recreation Area has recorded sales of 24,700 to authorized purchasers through the current date. This is lower than the 33,000 mintage of last year’s releases that had caused a frenzy to ensue.
America the Beautiful Five Ounce Silver Bullion Coins
|2010 Hot Springs||33,000|
|2010 Grand Canyon||33,000|
|2010 Mount Hood||33,000|
sales figures through December 5, 2011
(By law the US Mint may only sell the bullion releases of the series during the year of issue for the corresponding quarter. However, there’s no telling how many coins authorized purchasers may choose to order before the close of the year.)
Numismatic Coin Program
The numismatic versions of the America the Beautiful Five Ounce Silver Coins issued by the United States Mint experienced a similar cycle of frenzied interest, followed by a sharp decline. These numismatic coins carry an uncirculated finish created through a vapor blasting technique. The coins also carry the “P” mint mark.
The US Mint completed the entire production of 27,000 units for each of the five 2010 designs before the close of the calendar year, with plans to offer the coins during the first quarter of 2011. Initially, it was not specified whether the coins would be sold as a set or offered individually. The Mint opted for the latter option, with the Hot Springs coin put on sale April 28, 2011.
For the Hot Springs coin, the US Mint imposed an ordering limit of only one per household. Ahead of the release, some major dealers were offering instant premiums for collectors who would order the coins for immediate resale. Collector interest was so strong that the initial rush of orders caused the Mint’s website to crash and remain offline for 45 minutes. By the end of the day, orders had been received for 19,000 coins. A full sell out took about 15 days to occur.
The following coin featuring Yellowstone National Park experienced a similar pattern of sales, with a strong opening and complete sell out after 15 days. Sales would slow for the following releases with sell outs occurring after 30 days and then 65 days for the Yosemite and Grand Canyon coins. The following release featuring Mount Hood National Park still remains available for sale.
The first of the 2011-dated releases featuring Gettysburg National Park was released on September 22, 2011. For this and all subsequent releases to date, the Mint increased the maximum mintage to 35,000 and increased the initial ordering limit to five per household.
The most recent coin featuring Olympic National Park went on sale November 29, 2011. Based on the latest available US Mint sales report published today, sales were 8,662 in the opening period, representing the slowest start to date.
America the Beautiful Five Ounce Silver Uncirculated Coins
|2010-P Hot Springs||27,000|
|2010-P Grand Canyon||26,019|
|2010-P Mount Hood||25,781|
sales figures through December 5, 2011
(By law, the US Mint cannot strike these numismatic coins after the date inscribed. There is no restriction on how long coins that have already been struck may continue to be offered for sale.)
In a future post, I will have some thoughts on the program, its future, and the implications of swift change in collector interest.