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Palladium Paradise

Posted by Matt Draiss, Professional Numismatist on 10/27/2017
Palladium Paradise
The HOTTEST Bullion Release of the Year? 

The U.S. Mint is doing something that has never been done before, striking a coin out of palladium! The mint has been making gold, silver, and platinum coins for decades. These coins are coveted by millions around the world. Everywhere you look in the investing/ collecting arena, you see something about the eagles made out of gold, silver, and platinum, but never before palladium. The U.S. Mint’s website is pleased to be showing off the 2017 palladium American Eagle coins that were sold to official distribution centers September 25. The coins were minted thanks to Public law 119-94. This coin will be minted in only one ounce format of .9995 palladium. The coin is designed after the work of Adolph Weinman, the famous designer of the Mercury dime and Walking Liberty half dollar. The obverse will depict a similar design to the Mercury dime, and on the reverse will be a similar design to the Walking Liberty half dollar, although this design specifically originated from a 1907 medal engraved for the American Institute of Architects. This design is fresh for United States coinage. Weinman’s work is so popular and sought after that the American Eagle series in silver has totally evolved around his famous Walking Liberty design. These coins debuted in 1916, and last year we were privileged to see a gold rendition of the half dollar and dime from the mint. This is a “must have” coin to own and prices are already appreciating substantially.

Palladium as a metal is almost as new as this coin in the grand scheme of things. www.thefranklinsociety.com states that “The metal was unknown until its discovery in 1803, and languished in anonymity until WWII, when the U.S. government declared trade in platinum illegal (it was used for weapons). Because palladium looks so much like platinum and is chemically similar, jewelers began substituting it for platinum. Eventually, palladium became one of the big-five precious metals alongside gold, silver, platinum, and rhodium.” The site also mentions that the former Soviet Union had a large quantity of this metal, and some of the metal was sold off recently.

Palladium is currently at its highest price on record, according to Nasdaq charts. The past year has seen a 50% spike in the price, while gold has only fluctuated around 25% and silver at approximately 30%-35% in the same period of time. Clearly, palladium has grown much faster and quicker than other precious metals. Platinum has only seen a 15% fluctuation rate. Clearly, palladium has been the hottest metal of the past year for trading and investing in terms of price growth. In July, Reuters wrote , “A poll of 26 analysts and traders conducted by Reuters this month returned an average palladium price forecast of $811 an ounce for this year, 5 percent above an average view of $770 returned by a similar poll conducted in early April.” At the time of writing this article, the spot price of palladium is $914 as seen on Kitco, so in just two months these predictions have already been beat. “We remain constructive on palladium’s outlook,” Standard Chartered analyst Suki Cooper said. “Not only is the market set to deliver a deficit this year, but it looks set to be undersupplied over the coming years,” reported Reuters, along with, “Catalyst manufacturer Johnson Matthey said in May the palladium market deficit was expected to widen to 792,000 ounces in 2017 from 163,000 ounces last year.” You can see a quite apparent demand for palladium just used in manufacturing alone. We don’t know and are not making predictions as to where the spot price is going, but this is showing just how popular this metal is in the marketplace.

Fast sales of this coin happened even before they were officially shipped and sold during internet pre-sales. Coinweek mentions that the coins hit the marketplace to the U.S Mint’s official dealers on September 25. A quick scan of the Ebay marketplace shows just how fast pre-sale coins were selling. The coins weren’t available until early October to most collectors, but some coins sold fast at the tail end of September during the pre-sales. Raw coins, MS-70, and MS-69 slabbed coins were among some of these listings. The lowest sold price for an MS-70 slabbed, palladium Eagle was over double the palladium spot price! One coin sold for over $2,000! (Ed. Note: Almost any ‘graded’ MS70 coin is selling for well above $2000 now!)

We are pleased to be offering this new coin here at Chattanooga for our readers. This is a great opportunity to acquire one of these coins to add to your collection from us today. These should sell out fast, so don’t delay in ordering. The design is historic, the metal is a popular new format, and the supply is short with only 15,000 coins currently being minted! Coinnews.net is showing the government is not revealing the mintage total, so this coin may have a low mintage of just 15,000, or more if the people demand it!

This is a special update for the readers of the Coin and Currency Wholesaler: Palladium has just surpassed platinum for the first time in over a decade. Barron’s shares with us some of the reasoning behind the demand for this metal. “Total global demand for platinum is forecast to fall about 8% this year from last year’s levels, to 7.61 million ounces. The market probably will have a supply surplus in 2017 for the first time in six years, according to a report by analysts at Johnson Mathey. Palladium demand is seen rising to 10.13 million ounces this year—topping 10 million ounces for the first time since 2014.

The Johnson Matthey report forecasts a deficit of nearly 800,000 ounces this year.” At the time of this update, the Kitco spot close price was $940 for platinum and $981 for palladium. This is a difference in price of about 4%.

In other news, Coinweek.com just announced that a new surface has been found on the palladium eagles called “prooflike”. The breakthrough was discovered by the Numismatic Guaranty Corporation, one of the largest coin certification companies in the world. Mark Salzberg is one of the foremost authorities on United States coins in the world, “I think this is the most exquisite and successful design for a US coin of the modern era,”said Mark Salzberg, NGC Chairman. “It combines a classic obverse with a powerful reverse in beautiful high relief. The new Palladium American Eagle is truly magnificent.”