Mint Sells $948 Million in Bullion Coins in 2008

[Schatzy]

Circulation coinage was down 25 percent last year (from $1.7 billion face value in 2007 to $1.2 billion in 2008, and it is probably no great surprise that numismatic sales of circulating coins was also down by 18 percent.

 

Still, the numismatic sale of circulating coins amounted to $29.6 million - down from 2004 at the height of the state quarters program when $62.1 million in sales was racked up. The Mint's numismatic program increased by about 2.4 percent over last year with $527 million in gross sales. In 2007, it was $515.4 million - and five years ago in 2004 it weighed in at a mere $279 million.

 

Higher returns and profit were possible, but the report states the Mint's mandate: "Our mandate for numismatic coin sales is not to maximize profit but to recover costs and keep prices as low as practicable so that Americans can afford them."

 

The bullion program brought in a whopping $948 million in revenue and net income of $17.8 million - but protecting that profit was a hedge purchase, revealed for the first time in the Mint report. The bullion program's aim is also revealed: "By law, the purpose of the bullion coin program is to make precious metal coins available at minimal cost to investors, so we manage to a 2 percent margin."

 

Actually, the Mint missed the margin slightly, since the net income on $948.8 million in sales would be $18.9 million; still, a $17.8 million profit is credible. It also acknowledged supply problems with gold and silver in 2008.

 

"In FY 2008, we produced more ounces of precious metal bullion coins than any prior year, a feat that we are proud of. However, we could not procure enough planchets to meet demand. We were forced to temporarily suspend sales and established allocation programs to equitably distribute available inventory to authorized purchasers."