The U.S. Mint has reduced the volume of gold and silver coins it’s distributing to authorized purchasers as the coronavirus pandemic slows production, a document seen by Bloomberg shows
The Mint’s West Point complex in New York is taking measures to prevent the virus from spreading among its employees, and that will probably slow coin production there for the next 12 to 18 months, the document shows. The facility is no longer able to produce gold and silver coins at the same time, forcing it to choose one metal over the other, according to the document, which was presented to companies authorized to buy coins from the Mint last week.
The West Point facility is one of the primary sites for bullion production, along with the San Francisco complex, which only partially reopened in May after shutting down earlier in the year. During the 2019 fiscal year, the U.S. Mint overall produced 18.8 million ounces of bullion, according to its most recent annual report.
A spokesman for the Mint didn’t immediately have comment.
The pandemic created a whole new set of challenges for us to manage
“The pandemic created a whole new set of challenges for us to manage,” the Mint said in the document. “We believe that this environment is going to continue to lead to some degree of reduced capacity as West Point struggles to balance employee safety against market demand.”
The U.S. Mint -- which makes gold, silver, platinum and palladium coins that are sold through a network of distributors -- has been producing commemorative and investment coins at a lower capacity since reopening the West Point facility and imposing social distancing earlier this year.
The cuts are yet another blow that the pandemic has dealt to America’s coin supplies. Just last week, the Mint urged Americans to spend their pennies, nickels, dimes and quarters because the pandemic has cut in-store sales purchases and slowed the pace of coin circulation nationwide.
The reduced allocations are also coming just as investors are clamoring for precious coins. Global uncertainty over the pandemic has driven silver and gold prices to multi-year highs, turning coins made from the metals into a retail safe haven. The premiums for some coins over the spot prices of the metals have surged to record levels.
To cope with demand, the Mint is now asking dealers to provide their 10-day and 90-day forecasts for demand for the first time ever. That will allow it to decide what products to make as some are more labor-intensive than others, according to the document. If the Mint decides to make one-tenth of an ounce of gold, for instance, it must cut production of American Eagle Silver coins.