World mints report soaring demand for gold coins
Mints around the world say demand for gold coins has risen sharply as
interest in the precious metal soars on the back of financial instability
and concerns over the inflation outlook
By Jan Harvey, Frank Tang, James Macharia, Cameron French, Adrian Bathgate
and Gus Trompiz
13 March 2009
The Royal Canadian Mint, which produces Maple Leaf bullion coins, said it quadrupled its production capacity late in 2008 as demand for gold and silver bullion products leapt.
Gold was one of the few commodities to rise in 2008 as turmoil in the financial sector sharpened investors' appetite for assets seen as a safe store of value, such as bullion.
Spot gold rallied to an 11-month high of $1 005.40 on February 20 as a slide in equity markets increased interest in the precious metal. Demand for physical gold products such as coins and bars has been particularly strong, traders say.
The United States Mint said sales of its one-ounce American Eagle gold bullion coins rocketed from 140 000 ounces in 2007 to 710 000 ounces in 2008.
"The demand for gold and silver has been unprecedented," a spokesperson for the mint said.
The chairman of the French Mint, Christophe Beaux, said sales roughly doubled in 2008 in value terms and were expected to rise by another 50 percent in 2009.
The 2009 catalogue the mint had produced was almost entirely pre-sold, he said. The French Mint produces €100 gold coins and plans to mint 10-ounce and 1-kilo coins in 2009.
In South Africa - the world's second largest gold producer - Natanya van Niekerk, deputy general manager for numismatics at the South African Mint Company, said she had seen a big increase in demand for gold.
"I think we will see this same trend in this and the next quarter," she said. "Gold surely has been resilient in these times."
Michael O'Kane, head bullion trader at the New Zealand Mint, said many overseas buyers had come into the New Zealand market. "We're seen as a safe-haven market," he said.
He said buying had been strong since the collapse of US investment bank Lehman Brothers in September 2008, as investors moved money from banks into hard assets such as gold.
The mint was averaging "a month's transactions in a day", he said, adding he saw demand continuing to rise. - Reuters