In 2017, South Africa celebrated the 50th anniversary of the world’s first modern gold bullion coin, the famous Gold Krugerrand, with the new release of the first-ever Silver Krugerrand coin. GovMint.com and ModernCoinMart were named by the South African Mint as the exclusive U.S. distributor for the new Premium Uncirculated Silver Krugerrand minted specifically for collectors. The Silver Krugerrand was a fitting tribute to the 50th anniversary of the landmark gold coin
The Krugerrand has a fascinating history and is still the most widely traded gold bullion coin ever minted. Debuting in 1967, the Gold Krugerrand is aptly known as the first modern gold bullion coin. The Krugerrand paved the way for every other gold coin that followed, like Gold Maple Leafs, China Pandas, and American Gold Eagles among others. They all owe their very existence to the original Gold Krugerrand. Fifty years later, the Krugerrand legacy truly endures with a new release from South African Mint… The first-ever 2018 Silver Krugerrand Bullion Coin minted for both investors and collectors. The following, is a brief history of the Krugerrand story from the discovery of gold in South Africa over 130 years ago, to the minting of the first gold Krugerrand in 1967, and now to the first ever Silver Krugerrand bullion coin which launched in 2018.
South Africa Gold Discovery
Legends of gold in Africa were rumored long before South Africa became a country, due to ancient gold artifacts found in the area. Early settlers to Africa searched for the legendary gold, and small gold-mining operations began in the 1800s, with little success. That was until 1873, when an eccentric loner named Alec “Wheelbarrow” Patterson, discovered a vast gold deposit in a stream outside of Sabie, in the province of Mpumalanga (known as the Place of the Rising Sun). Patterson got his nickname after getting kicked by his donkey when he opted to load all his mining gear into a wheelbarrow and walked the thousand mile journey from Cape Town to the gold fields in Sabie. After arriving, he found the diggings at Sabie were much too crowded for his liking, so he wandered off to a muddy stream a few miles outside the mining camps where surprisingly, he discovered gold. Being a greedy hermit, Wheelbarrow kept the gold secret to himself, until another wandering gold digger, William Trafford, came along and also found gold in the stream, loudly proclaiming, “The Pilgrim is at rest!” Trafford officially registered his claim on September 22, 1873, in the area that became known as Pilgrim’s Rest, which triggered a huge rush for gold. In less than a year, 1,500 diggers were working 4,000 claims, which changed the face of the region forever and led to the South Africa Gold Rush.
South Africa Gold Rush
Gold had been mined in South Africa since the early 1870s, but it wasn’t until 1886 that vast amounts of gold were discovered on the Witwatersrand, in the Transvaal region. “Gauteng,” means “place of gold” in Sesotho, and that name was given to the province to commemorate the Witwatersrand gold rush to this area when gold was discovered in 1886. The Witwatersrand gold rush spread further than Africa’s city of gold. The gold rush in Transvaal began to rapidly expand, and the area was became known as the “Golden Arc,” because it was the home to some of the richest gold deposits on earth. The 1886 discovery of the main gold-bearing reef lit the fuse to an explosion of migrant workers, fortune seekers, and good old-fashioned gold-diggers. The population grew rapidly as a massive influx of foreigners flooded into the region. With the new discovery of gold, the Dutch and British governments wanted to claim the land, which was located in the northern region of what is now South Africa. Soon conflicts erupted over the massive golden resources, eventually leading to war.
The Boer Wars in South Africa
The Boer republics were a stumbling block for the British Empire. After the First Anglo-Boer War (December 16, 1880, to March 23, 1881), the British government did not give up its ambition for unifying South Africa under Imperial British rule. The two Boer republics of the Orange Free State and the South African Republic (Transvaal) still maintained their desire for independence. Paul Kruger was president of the Transvaal at the time of the new gold discovery. He fought for the independence of the South African people from British rule. The rich Witwatersrand gold-mining complex was the largest gold-mining complex in the world, and there was increasing tension for control of the region.
The world’s monetary systems at the time, especially the British, were increasingly dependent upon gold, and the new discovery of gold led to war for control of those vast precious metal resources. The Second Boer War (October 11, 1899, to May 31, 1902) was fought between the British Empire and the two Boer states over the Empire’s influence in South Africa. Initially, Boer attacks were successful, until British reinforcements and harsh counter-measures later reversed the outcome. The Boers fought hard but lost, and the Transvaal was absorbed back into the British Empire in 1902.
Paul Kruger (1825 – 1904) was one of the dominant political and military figures in 19th-century South Africa and President of the South African Republic (or Transvaal) from 1883 to 1900. Even though Transvaal was officially an independent nation, the British annexed it in 1877. After the British annexation, Kruger emerged as a hero, making several trips to Europe to plead the case for Transvaal’s independence. After six years of campaigning for the cause, in 1883, the South African Republic’s independence was restored, and Kruger was elected president. In 1886, just three years into Kruger’s presidency, the vast gold discovery triggered another large gold rush in the region. Kruger wanted to protect the region and his people, so he established gold-mining policies that made it difficult to export gold. This caused the price of gold production to go up in the country while making it more difficult for newcomers to profit, which made him very unpopular with many Europeans. Paul Kruger was fondly regarded as “Uncle” after standing up to the British during the Second Boer War between 1899 and 1902. Kruger was forced out by British troops as the war turned against the Boers in 1900. He fled to Europe and spent the rest of his life in exile, refusing to return home following the British victory. He died in Switzerland at the age of 78 in 1904. Kruger became a legend to his people and his contributions to South African independence were never forgotten. His portrait was chosen on the first gold bullion coin, the Krugerrand, which is a tribute to his namesake.
The Gold Krugerrand- Grandfather of Modern Bullion Coins
The South African Mint is the official sovereign mint of South Africa and has been one of the world’s leading producers of coins since its founding in 1890. The Krugerrand was first introduced in 1967 to help market gold produced by the South African Mint, and as a vehicle for private ownership of gold. The Krugerrand was a new concept. They were, and are, legal tender of South Africa, but carry no monetary face value. Instead, their exchange rate is fixed daily and is determined by the spot price of gold. In other words, they are bullion coins of changing value. The mint introduced the Gold Krugerrand 50 years ago to promote the vast gold reserves of the nation and to offer a different medium of private gold ownership through gold bullion coins. However, economic sanctions against South Africa for its policy of apartheid made the Krugerrand an illegal import in many Western countries during the 1970s and 1980s. Exports of the gold Krugerrand were crippled due to the economic sanctions over South Africa’s policy of apartheid in 1985. These sanctions were lifted after apartheid ended, when the United States lifted the ban in 1991.
Iconic Krugerrand Design from the South African Mint
The Krugerrand features the man whom the coin was named after, Stephanus Johannes Paulus Kruger (Paul Kruger) who was also affectionately known as “Oom Paul” (Uncle Paul). Kruger served as the South Africa President from 1883 to 1990 and is still admired by South African citizens. The obverse features the left-profile portrait of Kruger, taken from a photo for Kruger.
The obverse design is by Otto Schultz, a die cutter at the Berlin Mint who prepared the wax model of the effigy of Kruger. Schultz’s original design appeared on the obverse of all the Boer’s 1892-1897 coins, penny to pond. Otto Schultz caused a bit of a stir when he placed his initials, OS, on the bust of Kruger on another coin. OS translates to Ox in Afrikaans, and political opponents started referring to “Dumb ox Kruger”. Needless to say the initials were removed on the coins, and never appeared on the gold Krugerrands.
The coin’s reverse features the national symbol of South Africa, a symbolic South African Springbok antelope, which a nimble deer native to the African continent, portrayed bounding across the savannah. Designed by talented South African sculptor Coert Steynberg, the design depicts the animal pronking, a characteristic leaping in the air from all four feet simultaneously. Steynberg is well known for creating the statue of Paul Kruger in the largest game preserve in South Africa, Kruger National Park, and for his Springbok antelope, which graces many coins including the Krugerrand.
This homegrown coin design appeared previously on the reverse of the Union of South Africa’s silver 5 shillings, gold pound, as well as the Republic’s gold rand. Tommy Sasseen, one of South Africa’s first home-grown die sinkers, was given the task of adapting Schultz’s and Steynberg’s original designs for the master dies of the 1967 Krugerrand. “Krugerrand,” is a registered trademark of the South African Reserve Bank of which the South African Mint is a subsidiary.
Minting Krugerrand Coins
On July 3 rd , 1967, South African Mint, the State minting institution in Pretoria minted the first Krugerrand, which soon became the world’s most traded gold coin. The Krugerrand was commissioned by the South African State, then the Rand Refinery near Johannesburg and the South African Mint started producing Krugerrands which have continued in production over the last 50 years. The Rand Refinery procures the gold and manufactures the blanks, the South African Mint strikes the coins, and then the Rand Refinery markets and sells the bullion Krugerrand’s globally. The gold Krugerrand is minted in a copper-gold alloy that is more durable than pure gold. The mix of 91.67% gold bullion with the remainder consisting of a copper alloy, gives the gold Krugerrand unique orange-gold color tone. The Gold Krugerrand proudly portrays both the country’s heritage and its wildlife in 22 karat gold. The name itself is a compound of the name Kruger (the former South African president depicted on the obverse) and rand, the South African unit of currency. The Krugerrand has had over 60 million gold issues struck since 1967.
Krugerrand Bullion Coin Production
The initial 1967 mintage of the Krugerrand was 40,000 pieces with 10,000 proofs. Only 20,000 regular issues were minted in each of the next two years. By 1970, the South Africa Mint produced five times that number, minting more than 211,000 gold coins annually. In 1971 the number jumped to 550,200, with 543,700 in 1972, and 859,300 in 1973. From 1974 to 1984 the annual production run was in the millions. In 1974, the country minted 3,203,000. Four years later, production soared to over six million Krugerrands in 1978. It is estimated that by the time the Krugerrand reached the all-time high in 1978, 22 million coins had been already been exported to the USA alone. In fact, during the gold boom of 1980, the Krugerrand accounted for 90% of the global gold coin market.
However, international sanctions were placed on South Africa in the wake of apartheid, and the Krugerrand production drastically dropped. President Reagan banned imports of Krugerrands, formally denying South Africa its most lucrative market for the gold coins, while satisfying a key demand of lawmakers pressing to punish the white-run Pretoria government for its racial policies. These sanctions were lifted after apartheid ended, when the United States lifted the ban in 1991. Following the end of apartheid, Krugerrand production dropped to 8,276 coins (including 2,000 proofs) in 1998, but since then levels steadily increased.
In the 6 years of the Krugerrand’s absence, new bullion coins flooded the market, and the Krugerrand would not rise to the heights it once enjoyed. Even though new bullion competitors like the American Gold Eagle in 1986, and Canadian Gold Maple Leaf emerged as popular alternatives, the Krugerrand still remained a popular gold bullion coin and is still the most actively traded gold bullion coin in the market today. Since 1967 they have been struck every year with occasional slight variations in diameter and thickness. In 50 years more than 61 million have been produced containing over 58 million ounces of gold. The total value is well over $70 billion at today’s prices.
Krugerrand Popularity Among Coin Collectors
It was only after the introduction of the gold Krugerrand in 1967, that everyday people could confidently purchase 1 oz. of pure gold in a durable fashion. The coin contains 91.67% (22-karat) gold bullion with the remainder consisting of a copper alloy, that gives the gold Krugerrand its unique orange shine. The Krugerrand became an instant worldwide hit and still holds the title as one of the most respected and collected coins of the last century. It is the most widely held bullion coin in the world, the most traded coin in history, and has been the model for all other bullion coins issued since its debut. The gold Krugerrand opened the doors for other world mints to strike various gold bullion coins. With over 60 million sold to date within just five decades, Krugerrands are an internationally trusted commodity. With a reputation for providing personal wealth and security in times of financial uncertainty. Krugerrands have been a mainstay for gold investors for decades and are known around the world for their consistent weight and purity. Investors can buy gold Krugerrands in a variety of sizes to save for retirement, emergencies, and to protect the value of their savings with a tangible asset for portfolio diversification. Proof and commemorative issues of South African Krugerrand gold bullion coins are also available for collectors to purchase for fun and profit.
The 2018 Silver Krugerrand
Half a century after the first gold Krugerrand, the South African Mint made history again with a 1 oz. Premium Uncirculated Silver Krugerrand commemorative coin designed for collectors. However, precious metal buyers wanted a competitively priced Silver Krugerrand Bullion coin with a low premium price over the current spot price of silver, for diversification in their investment portfolios. In response, the South African Mint issued the firstever Silver Krugerrand as a low-premium silver bullion coin. Although South Africa previously released a higher-premium 2017 Silver “K-Rand” for minted for collectors, the 2018 issue is the first coin available at a low bullion premium.
This is the first year this popular South African coin has been offered as a Brilliant Uncirculated Silver coin. Created from the original gold Krugerrand design, and struck in one full oz. of .999 fine silver, this legal-tender Silver Krugerrand features the tried-and-true design of the original coin minted in pure silver. The South African Mint created this 1 oz. Silver Bullion Coin as a means of an affordable tangible investment vehicle that is tied to the popular gold Krugerrand legacy. The Silver Krugerrand Bullion coin is just the beginning for future diversification in silver, that is built on the enduring Krugerrand reputation. The dies for the new Silver Krugerrand were digitally enhanced through innovative laser-etching technology, not available in 1967. The results are razor-sharp detail, highlights, and shading not seen on any Krugerrand coin before. The 2018 First-Ever Silver Krugerrand is a must buy for any serious investor or collector. The 2018 first year issue of the Silver Bullion Krugerrand is a very desirable and affordable coin to own on any budget.
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