US Mint Struggling With Gold and Silver Coin Production Slowdown
According to a Bloomberg report, the US Mint complex in West Point, N.Y., is taking measures to reduce the spread of COVID-19 among its employees and expects production slowdowns for the next 12 to 18 months. According to a US Mint document, the facility can no longer simultaneously produce both gold and silver coins, forcing it to choose one metal over another.
“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 West Point facility serves as one of the US Mint’s primary bullion production sites, along with its San Francisco complex. The California facility shut down earlier this year and partially reopened in May.
The production slowdowns come as investors clamor for gold and silver bullion coins. Retail silver bullion coin sales jumped by an estimated 60% year-on-year in the first half of 2020, according to data released by the Silver Institute. Meanwhile, the price of gold has surged to an all-time record high.
Even with the production issues, the sale of American Gold Eagles in July is up significantly over last year. To date, the Mint has sold 92,500 ounces of Gold Eagles compared to just 22,000 ounces in July 2019. But the sale of American Silver Eagles is down slightly. To date, the Mint has sold 1,072,000 ounces of Silver Eagles compared to 1,240,000 in July 2019.
In an effort to cope with the supply issues, the Mint is asking dealers to provide 10-day and 90-day demand forecasts. This is the first time this has ever happened. According to the Mint document, this will allow it to decide what products to make since some are more labor-intensive than others.