by Louis Golino for CoinWeek
The U.S. Mint has announced that it will honor the 75th anniversary of the San Francisco branch of the U.S. Mint with a special two-coin American silver eagle proof set.
The set will include two proof silver eagles with San Francisco mint marks. One will be a regular proof coin, and the other will be a reverse proof. The latter will be the third reverse proof silver eagle issued so far, following those made in 2006 and 2011 for the 20th and 25th anniversaries of the silver eagle program. But it will be the first reverse proof with an ‘S” mint mark, making it a unique piece.
Proof silver eagles have been issued at the West Point branch since 2000, but between 1986 and 1992 they were minted in San Francisco. They were also issued in Philadelphia between 1993 and 1999.
The current facility in San Francisco has traditionally been used mostly to produce proof coins and proof sets, although circulation quality coins have also been made there during certain periods. The original San Francisco mint, which first opened in 1854, survived the 1906 earthquake. The current facility opened its doors in 1937.
For the first time the Mint will be trying a new approach to distributing a special set of silver eagles. It will allow unlimited orders for a one month window. The coins will go on sale on June 7, and sales will end on July 5. Household limits have not been announced.
Production will begin on May 11, and orders will be processed in the order in which they were received. Shipping is slated to begin in late July.
No price has been announced yet and probably will only be made available when the sets go up for sale on June 7. Collectors speculate that it will be around $120, or somewhere between $100 and $150.
The final mintage of the sets will be determined by the number purchased during the one-month window.
A sales odometer will be placed on the Mint’s site to track sales of the sets and allow buyers to see how the mintage number is shaping up. This is also a Mint first.
In 2009 the Mint issued the highly regarded Ultra High Relief double eagle gold coin, an official reproduction of a famous American rarity made in extremely small numbers in 1907 primarily so that President Teddy Roosevelt could give one to his daughter as a marriage present.
The 2009 coins were also made to demand, but orders were allowed for about a year, and there was a household limit of one coin. Those coins, which were initially priced at $1289 in early 2009, are today worth between $3,000 for raw examples and $5,000 for first strike PCGS-graded MS70 coins and even more for proof-like MS70 examples.
Last October when the Mint sold out of all 100,000 25th anniversary silver eagle sets in less than five hours through online and telephone sales, the Mint was deluged with complaints from customers who were unable to place an order because the Mint’s site and phone lines were totally overwhelmed.
The combination of a 100,000 mintage and a household limit of five sets, as I argued recently in Coin World (www.coinworld.com), ensured that the entire mintage would be snapped up by a relatively small number of people. The average order was for almost four sets, so at most about 25,000 people own the mintage of that sets, and the actual number has to be much smaller since many sets were bought by dealers and flippers who used staff and friends to place more than the household limit.
The Mint first responded to the criticism of its marketing approach for those sets by apologizing and saying it would do better next time. It has plans for an improved ordering system, but they will not be implemented before next year.
Then earlier in the year the Mint sent some customers a survey which asked about preferences for various types of special silver eagles and sets such as reverse proofs, high relief coins, and coins with special mint marks.
Finally, the Mint announced the four-week window with unlimited mintage for the San Francisco sets as its way of addressing the concerns and criticism over its handling of the anniversary sets.
I applaud the Mint’s effort to address those concerns, and like many collectors I am looking forward to the San Francisco set.
A real collector does not constantly look for opportunities to make a profit by flipping sets for more than they paid. They actually care about the coins themselves.
It will certainly be interesting to see how things work out, and whether unlimited special sets become a precedent.
The Mint has stressed before that it is not in the business of creating instant rarities so that people can make quick profits. The Mint’s mission is to distribute coins in as broad and fair a manner as possible, even if that has not always been the result of its policies.
Moreover, the Mint is a profit-making entity, and with sales of many collector and bullion coins down this year, coupled with the anticipated drop in seigniorage profits after being required to limit production of dollar coins, the Mint needs to find revenue somewhere. A popular set with no mintage limit would seem to fit that bill.
A lot of coin buyers, flippers and true coin lovers alike, feel the Mint went from one extreme to the other with its plans for the new sets. They suggest the Mint could have ensured a fairer and broader access than before by increasing the mintage to something on the order of 200-250,000 sets and imposing a limit of either one per household or perhaps a couple sets per household. But that would still leave some people unhappy.
Some people feel the new sets will have virtually no aftermarket premium because of the unlimited mintage, but the track record of past items made to demand such as regular proof silver eagles and the 2009 UHR suggest otherwise.
Many say they will just buy one set to keep their collections updated. Some say they are not interested in a set with no mintage limit, and they even speculate that sales could be lower as a result of such views.
But others say that the sets may still have some additional value after the window is closed. I also suspect plenty of people will buy a second set or more to have them graded in hopes of getting a set with two 70 coins.
There is such a strong base of silver eagle collectors, here and abroad, which should help support prices for the new sets.
The bottom line as far as market potential is that these sets are unlikely to increase the way both anniversary sets have. The 20th anniversary set, which issued at $100, today sells for almost $500. And last year’s 25th anniversary set, which issued at $300, goes for over $800 today.
The new sets should at least hold their value in the short-term, and over time increases in spot silver prices, and demand from new collectors who start collecting after the sets are released, should drive prices higher, but probably not to several multiples of issue price at least in the near future.
Louis Golino is a coin collector and numismatic writer, whose articles on coins have appeared in Coin World, Numismatic News, and a number of different coin web sites. His column for CoinWeek, “The Coin Analyst,” covers U.S. and world coins and precious metals. He collects U.S. and European coins and is a member of the ANA, PCGS, NGC, and CAC. He has also worked for the U.S. Library of Congress and has been a syndicated columnist and news analyst on international affairs for a wide variety of newspapers and web sites.