Welcome to illuminati Silver, we tell you the truth about silver.
Today is Tuesday 13th October 2015 and we are producing this video to read and interpret
the Silver Institutes announcement about coin and bar demands and shortages.
Today, the Silver Institute has issued an announcement concerning their findings on
silver coins and bars.
We wanted to report this to you, as we have often said previously; we want you to receive
details of all sides of the precious metals debate.
This is exactly what they have said: “Retail investors in recent months have
seized the opportunity to significantly increase their holdings of silver bullion coins and,
to a lesser extent, bars.
Due to strong demand, the U.S. Mint, the Royal Canadian Mint, Australia’s Perth Mint, the
Austrian Mint and the British Royal Mint have put their silver bullion coins on allocation,
where the volume of distribution of coins is controlled due to bottlenecks in the manufacturing
process.
This is an unprecedented industry-wide phenomenon.
In recent history, putting bullion coins on allocation has only occasionally been done
by the U.S. Mint.
The practice points to considerable tightness in the silver coin business at the moment.
Globally, silver bullion coin sales reached an all-time high of 32.9 Moz in the third
quarter of this year, according to GFMS Thomson Reuters data.
This volume was a 74% quarter-on-quarter and 95% year-on-year increase.
Sales in North America, Europe, Japan and other Asian countries (predominantly China)
saw quarter-on-quarter growth of 74%, 72%, 95% and 202%, respectively.
As a result, lead times for silver coins have been stretched from immediate delivery to
3-4 weeks in some cases.
This is an unusual occurrence in the industry, with several dealers stating this is the first
time they have experienced lag times for certain coin products.
Additionally, the shortage is apparently both a supply and demand issue.
While demand is very strong, given the slow global economic outlook and attractive silver
price, the mints are finding it difficult to source the blanks needed to produce the
coins.
“It is clear that investors are continuing to demonstrate their desire for silver bullion
coins and we encourage national mints across the globe to examine their manufacturing pipeline
to ensure that this strong demand is met with immediate fulfilment,” stated Michael DiRienzo,
Executive Director of the Silver Institute.
Silver bars are also experiencing a slight shortage, although confined to bars under
100 ounces, specifically one ounce and ten ounce bars.
Delivery times have increased from immediate to a 10 day delay in the most extreme cases,
especially in the U.S. and Canada.
The increase in demand in recent months has been primarily driven by bargain buying, particularly
after prices fell below US$15/oz.
The demand remained buoyant when prices reverted back above US$15/oz, however, as shortages
in products spurred ever more investor interest in the white metal.”
So what is the Institute really saying?
Well it is pointing out that there is demand for silver coins and bars below the $15 level,
and this is important to note.
It has also referred to a bottleneck in blank production because of this demand, and it
is basically urging mints and blank manufacturers to look at their operations to cater for such
eventualities.
Now this to us is the most important point to bear in mind.
Demand and supply for 1000 oz bars – which are the commercial bars – has not been unduly
affected, only the smaller bars.
Why is this important, well as we have indicated before, if there were a true silver shortage,
this would show up in terms of the availability and price of 1000 oz commercial bars.
So far these have been readily available, and it is this that tells us, silver is not
in short supply.
Of course our view will change, should 1000 oz bars become scarce or premiums rise on
them significantly.
So what does all this mean, well, it suggests that below $15 silver is seen by many retail
investors as a good opportunity for purchase.
However, please bear in mind, do not be persuaded to pay high premiums or to panic should prices
rise a little, especially when pumpers suggest there is a shortage – there is not- but
a bottleneck does exist, which can eventually be relieved.
Of course, as we have always maintained, a major ‘black swan event’ can change the
landscape, but assuming one does not occur, there is adequate silver supply to meet demand,
although the blank production may cause delays in supplying it in a timely fashion.
We hope you have found this video helpful and informative, and would appreciate it if
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Disclaimer:
Silver Illuminati owners come from a background of Banking, International Wealth Management
and Economics.
Having now retired from these worlds we are not qualified to give investment advice.
Therefore, this and other productions must not be deemed to be giving such advice and
merely represent the personal views of its owners.