Gold, Silver Prices Fall while US Bullion Coins Maintain Momentum

Gold declined Wednesday, taking away a sizeable portion of the sharp gains from the previous day. Profit taking was among the major reasons cited for losses.

"We’re back into the technically congested area. It’s easier to take profits if you’ve got some than to hold onto it with this much uncertainty going on," Reuters quoted Sean McGillivray, head of asset allocation for Great Pacific Wealth Management.

Gold prices fell $17.10, or 1.0% to $1,731.30 an ounce in the April futures contract on the Comex in New York. Gold hit an intraday low of $1,726.00 and made it as high as $1,754.80.

Silver prices for March delivery lost 49.0 cents, or 1.4%, to $33.704 an ounce. Silver’s low was at $33.655 while its high was at $34.520.

PGM metals bucked the falling trend of gold and silver.

Platinum prices for April delivery rose $13.30, or 0.8%, to $1,668.10 an ounce, ranging from $1,645.30 to $1,669.40. Palladium prices for March delivery advanced $6.75 or 1.0%, to $715.90 an ounce, trading between $704.95 and $717.95.

Jon Nadler, Senior analyst at Kitco Metals Inc. wrote the following of the metals.

There are a couple of fresh news items on the subject of the noble metals that merit our attention: they come from Norilsk, Lonmin, and South Africa. Read on:

The world’s top palladium producer, Norilsk Nickel said on Tuesday that “PGMs have investment potential comparable or even greater than gold.”

Platinum has moved 16% higher thus far this year, while palladium has advanced by 24% from its October lows. Existing platinum above-ground supplies might last no more than 7 months if production of the metal were to be halted. A Norilsk official puts the price of palladium at $2,100 in five years’ time, while he also sees a 50% gain (to $2,500) as possible in platinum. Gold would have to touch $5,100 to mirror the kind of performance that Norilsk envisions in palladium.

Another PGM producer, Lonmin, told attendees at the Africa Mining Conference in Cape Town that the risk of platinum supply disruptions is growing. The firm’s CEO, Ian Farmer pointed to “government safety stoppages, labor management difficulties, skills shortages, transformation and equity ownership challenges, rising community expectations, resource nationalism and high electricity prices” — all of which are making operating in South Africa increasingly difficult.

Also down in South Africa, labor strife continues to cast a fairly dark shadow on the output in the PGM space. As recently reported here, Impala Platinum (the planet’s second largest platinum producer) fired more than 17,000 workers during what the firm has called an “illegal strike.” And then, there remains the subject of the possible nationalization of that country’s mines; a thorny — and as yet unresolved — issue and one that will not come to be addressed without contentiousness.

London Precious Metals

Precious metals in London were higher. When comparing the London PM fixings between Tuesday and Wednesday, gold gained $22.00 to $1,746.00 an ounce, silver prices soared $1.09 to $34.37 an ounce, platinum rose $28.00 to $1,647.00 an ounce and palladium advanced $7.00 to $707.00 an ounce.

U.S. Mint Bullion Coins

The U.S. Mint on Wednesday registered sales for each of its one ounce bullion coins for a second straight day. The American Gold Buffalo climbed 500, the American Gold Eagle added 2,000 and the American Silver Eagle gained 40,000.

The latest daily, February and year-to-date U.S. Mint bullion coin sales are provided below.

All bullion coin totals in the above tables are in the number of coins sold, not the amount of ounces. The latest five-ounce sales were provided by the U.S. Mint on Friday, January 27, 2012. The Mint does not publish daily sales figures for its five-ounce silver coins. Although, since the last released date is more than two weeks past, there likely has not been new sales to report.