‘So Weak’
The Mint has no plans to discontinue the sale of platinum coins, “though we did not expect the response to be so weak,” said Tom Jurkowsky, a spokesman for the Mint in Washington. “We will take a wait-and-watch attitude.”
Edmund C. Moy, the director of the mint in 2008, said he canceled the platinum coins that year because declining sales made production financially unfeasible. “The law states that the Mint cannot lose money on its bullion products, yet sales barely made break even,” he said in an interview Aug. 11.
While demand for platinum coins has been muted, investors aren’t completely shunning the metal.
Holdings in the exchange traded funds backed by platinum are up 13 percent this year, after five straight monthly gains and touching an all-time high of 88.86 metric tons on July 23, data compiled by Bloomberg show. Money managers have more than doubled their bets on a price gain this year to 39,080 U.S. futures and options contracts, Commodity Futures Trading Commission data show.
Global Output
Global output of the metal will trail demand this year by the most ever, Johnson Matthey estimates, after a disruption in supply during a five-month strike at mines in South Africa, the biggest producer.
Almost 38 percent of total platinum demanded will be used in pollution-control devices in cars and trucks this year, followed by demand for the jewelry industry, which will grow more than 5 percent this year, according to London-based Johnson Matthey, which makes a third of the world’s catalytic converters. Almost a fifth of the metal is used by the chemical, petroleum, electrical and the medical industries.
“The fundamentals for platinum are very strong,” Paul Christopher, the chief international strategist at Wells Fargo Advisors LLC, which manages $1.3 trillion, said by telephone from St. Louis on Aug. 15. “Investors are buying the metal as they expect prices to rise higher.”
Limited Appeal