The Coin Analyst: 2012 U.S. Mint Coin Sell-Outs Help Support Modern Coin Market

by Louis Golino for CoinWeek

Modern U.S. coin collectors often seem to have what could be called a Rodney Dangerfield problem. They can’t get any respect from serious numismatists, coin experts, and dealers who specialize in classic coins. They are told that the Mint mainly sells over-priced and over-hyped coins that will only be worth their metal value in the future.

It is true a lot of modern U.S. mint products have underperformed on the secondary market, especially clad proof sets and some commemorative coins.

But in recent years, things have really started to change. The U.S. Mint has been issuing a much more diverse and interesting array of collectible coins at different price points than it did in decades past. And the market for modern Mint coins is robust and growing, with e-Bay and the professional grading companies providing a major boost to this market.

Another significant trend is that the Mint has recently been keeping collectors guessing about when they will end sales of different products. In the recent past it seemed like many coins and sets that were not special, limited edition items lingered around forever, and that is why such coins have underperformed. But more recently, a lot of coins and sets became unavailable unexpectedly, and some collectors missed out on good opportunities as a result.

2012 is perhaps the best example of this development. A real plethora of coins sold out early and unexpectedly such as the Lucy Hayes and Lucretia Garfield gold first spouse coins, which set new mintage lows not just for their series but for modern gold coins.

Perhaps the best examples are the 2012 proof sets and S-mint quarters. Each of those products sold out earlier than expected, and all are selling now for substantial premiums.

2012 proof sets

The Mint decided to clean out its inventory and did a major last chance, year-end sale of numismatic products from 2011 and 2012. That resulted in a number of new low mintage coins or second-to-lowest in their respective series such as the 2012 Buffalo gold coin, which is now second only to the 2008 key coin.

And on the heels of that sale, the Mint unexpectedly ended sales of the clad and silver 2012 proof sets, which resulted in new low mintages for modern proof sets and rising secondary market values for those sets.

The clad set, which had an issue price of $31.95, has in the span of a week since its January 3 sell-out, doubled in price to $65-70 on e-Bay and at coin dealers, most of which are sold out of the sets.

The silver set was issued at $67.95, quickly reached $100 during the days following the sell-out, and is now fetching $125.

The clad sets sold 794,002 units, which is less than any other modern non-silver set. Most years these sets sell well over a million units. The 2011 set sold 1,098,835 units. The 1964 silver set with the JFK half dollar sold almost 4 million units.

For the silver set, the 2012 version came in at 395,443, which is lower than any silver proof set minted in the modern era. The previous low was the 1995 set at 549,878.

I would not be surprised to see the clad set reach $80 or more, and the silver set $150 or more, in the near future. The 2008 clad set, which set an earlier mintage low for that series, reached the $80 level, though it has receded a little since then, and the 1999 silver proof set once sold for over $300 not because of a low mintage, but because it was the first set with silver state quarters. Today it only brings about $100.

It is, of course, entirely possible that a future clad and/or silver set will have a lower mintage. There has definitely been a trend towards lower mintages in recent years, as collectors choose among such a wide range of products, and their budgets remain strained.

But on the other hand, sales of last year’s sets ended unexpectedly, and the sets were available for a much shorter period than most years’ sets are. The 2011 sets were available for about two years, but the 2012 sets had only eight months of availability, a substantial difference.

The Mint prefers to offer its annual sets earlier in the year to maximize sales, as it will be doing this year. The regular proof set will be released on March 28, and the silver set releases in May. Again, there is no guarantee a future set will not sell a lower number, whether because of less interest among collectors, or a long period of availability.

But proof sets will remain a core Mint product with very wide accessibility and millions of collectors are building sets of them. They are also very popular as gifts. During the Christmas holidays I saw someone purchase an entire box of proof sets to give as gifts to family members. So the 2012 sets could remain keys at least for some time.

In addition, the limited edition silver proof set, which costs $150 from the Mint and is limited to 50,000 pieces, now has more appeal since the regular silver proof set has such a low mintage, and the proof silver eagle coin that it includes sells for about $85 retail. Even if one adds the mintage of the limited edition set to that of the regular silver proof set (in terms of the silver coins since the regular silver proof set also has the proof cent, nickel, Native American dollar and set of Presidential dollars), and assumes a sell-out of all 50,000 units, the 2012 set would still have a mintage more than 100,000 lower than any previous silver set.

S-mint quarters

Another U.S. Mint product from last year that turned out to be a big winner is the S-mint quarters, which were not issued for circulation, but are circulation-quality coins and were only sold in bags and rolls at a small premium.

The Mint initially indicated that the coins would have a limited mintage then reversed course and said the coins would be made to demand. But in the end the coins sold out sooner than expected, and final mintages are in the 1.5 million range for each of the five 2012 S-Mint quarters. As of this writing, only the Denali and Acadia S-mint rolls are available.

The coins are the first S-mint circulation-quality quarters and the lowest mintage quarters minted since 1953.

Some people like to argue that they are not really rare, but rarity is relative with modern coins. What matters is that compared to quarters minted in Philadelphia and Denver in the hundreds of millions, they are actually quite scarce. Moreover, the only way to obtain them was to buy them from the Mint at a small premium when they were available, or to pay a large premium today on the secondary market. And there will always be collectors building sets of quarters that will need these coins.

I was quite frankly blown away when I checked e-Bay sales for these coins. Unopened rolls of the S-mint quarters that cost $18.95 from the Mint for a $10 face value roll are now bringing $60-70. And $25 face-value bags that cost $35 from the Mint when they were available are now fetching $100 a piece, which is a nice profit for those who took a chance on these clad coins.

The S-Mint quarters show that it is not just precious metal coins that capture the imagination of modern coin collectors in today’s market.

The Mint will be issuing another round of S-mint quarters this year to accompany the other national parks products it mints. It will be interesting to see what happens as far as when sales end and what final mintages turn out to be.

If nothing else, these developments are breathing new life into modern U.S. coin collecting, keeping collectors on their toes, and helping to buttress a healthy market for affordable modern U.S. coins.

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.