U.S. Mint Ends Era of “Coin Silver”

You probably know that the recently-issued 2019 Apollo 11 50th anniversary $1 silver commemorative coins, both the 5 oz. and regular silver dollars, are the first U.S. Mint commemoratives struck from .999 fine silver. What you may not know however, is that this trend in “fineness” from the United States Mint is continuing! The 2019 America the Beautiful silver quarter proof set released on February 21, is the first set that includes quarters made of the same .999 fineness. In addition, the 2019 silver proof set that will be released this spring, will include the first Roosevelt dimes and Kennedy half dollars issued in “three nines” silver. The limited-edition silver proof set coming later this year will also include silver coins of the same purity.

 

The legal authority for this move was part of the FAST Act (a transportation-related bill) that was signed into law in December of 2015 by then-President Barack Obama. A provision in that legislation gave the Mint the authority to issue coins of “not less than 90 percent silver.” Most people interpreted the language to mean that the Mint would eventually increase the purity of its numismatic silver coins, but it was unclear which coins and sets would be impacted, what purity would be used, and when the change would occur, until an announcement from the United States Mint on Feb 19. Starting in 2019, any coins that were previously struck in 90% silver, will now be struck in 99.9% fine silver. This includes silver proof dimes, silver proof half dollars, silver proof quarters as well as both silver proof and silver uncirculated commemorative dollars.

History of Silver Purity in United States Mint Coins

 

Silver coins made for circulation up until 1965, and commemorative coins issued from 1892 to 1954, were struck in 90% silver paired with 10% copper, which is sometimes referred to as “coin silver.” Coin silver is defined by Merriam-Webster dictionary as “silver of the fineness legalized for coins (such as .900 fine in the U.S., .500 fine for Great Britain since 1920).”

 

From the time of the first U.S. Mint silver coin, the half dime, which is believed to have been made with silver tableware from George and Martha Washington, was issued in 1794 until 1837, silver coins were struck in .89243 purity with the rest being copper. Silver coins were also convertible to gold coins at the rate of 15 to 1.

 

The reason silver coins were combined with copper was to make them more durable, which was very important for coins that circulated, since pure silver is a soft metal that is easily damaged. This is the same reason why other countries in the 1800s and 1900s issued silver coins of various purity such as .500, or sterling, which is .925.

In 1837 legislation was enacted that changed the composition slightly to a combination of .900 fine silver and 10% copper, which was used until the Coinage Act of 1965. That law decreased the silver composition to 40% for Kennedy half dollars and removed silver completely from dimes and quarters, replacing them with clad coins made of copper and nickel. In 1970 the Mint ceased production of 40% silver half dollars, as silver continued to rise in value, replacing them with clad half dollars and ending the production of silver coins for decades.

90% silver U.S. coins90% silver U.S. coins

The value of silver has fluctuated over the course of the history of the United States, which during certain periods required reducing the amount of silver in coins such as Seated Liberty half dimes, dimes, quarters and half dollars, which had arrows added to them when that was done. Then in the 1960s, demand for the metal began to rise, putting pressure on market prices and causing the silver content of coins to exceed their face value. The U.S. Mint had to cease production of 90% silver coins in 1964 as this happened, resulting in the hoarding of silver coins from circulation.

 

90% silver coinage was later resumed in 1982 when the modern commemorative coin program debuted and in 1992, with the resumption of silver proof sets that had been discontinued after 1964. 

999 the Global Silver Fineness Standard

 

World Mints have been striking pure silver coins for decades – with some like the Mexican Mint producing them with .999 fine silver, while others – such as the Perth Mint and the Royal Canadian Mint – now issuing most of their coins in .9999 fine silver, after initially minting them in “three nines.”

Royal Canadian Mint – now issuing most of their coins in .9999 fine silverRoyal Canadian Mint – now issuing most of their coins in .9999 fine silver

This move towards pure silver coins has helped fuel the explosion of demand for world silver bullion coins since bullion investors prefer pure silver coins, as do many collectors. In part this is because it is often much easier to calculate the value of silver in coins made of .999 or higher silver than it is for coins made of lower silver purity.

 

One of the reasons for the switch to U.S. Mint silver coins of .999 purity is indeed to bring them to the standard used by most mints today, which makes U.S. silver coins more attractive to buyers from other countries.

Advantages of higher silver purity in coins

 

There are also a number of other reasons why the switch to purer silver coins is beneficial, particularly in terms of manufacturing of coins.

 

The Mint did a comparison between the 2012 Infantry silver dollar (made of .900 silver) and the 2013 Proof American Silver Eagle (made of .999 silver), which found that the die life (the number of coins that can be made with the same die) was three times better with .999 silver; the amount of scrap metal left over during production was 4% less with .999 silver; and the number of products Mint customers returned was .7% less.

In addition, the combination of .900 silver and .10 copper (which exceeds the solubility of copper that can cause build up on dies) can result in spots and hazing on coins, which contributes to higher scrap rates and higher customer returns, according to the Mint. And “.999 silver also flows better under pressure, resulting in superior fills and fewer strikes to make numismatic coins”.

 

Milk spotting on eagles is the result of the process used to wash the silver planchets before the coins are made, so presumably much would depend on whether a similar process is used on the new silver coins.

2013 Proof American Silver Eagle (made of .999 silver)2013 Proof American Silver Eagle (made of .999 silver)

However, even if the switch to .999 silver purity does result in some coins with milk spots, this would likely pale in comparison to how often 90% silver coins develop toning and haze, because of the presence of copper, as collectors of those coins are well-aware.

 

In fact, the move to .999 silver not only creates greater efficiency in coin production, but should also result in numismatic coins made to higher quality standards.

 

Also, the change to .999 silver for dimesquarters, and half dollars has resulted in the need for the Mint to find new vendors who can supply planchets made of the higher purity of silver. 

 

Many U.S. collectors have for years felt the .900 silver coins were an anachronism and were pleased to learn several years ago that the Mint would be moving towards the production of pure silver coins for its numismatic products. The end of U.S. coins made of .900 fine silver, which occurred when the 2018 $1 silver commemoratives and coins for the 2018 silver proof sets were produced, is an important moment in U.S. numismatic history that brings our silver coinage in line with what other mints are doing while also taking it into new territory.

Sources

 

A Guide Book of United States Coins 2015 (Whitman, 2015)

 

Precious Metals (Whitman, 2011)

 

Paul Gilkes, “End of an era of U.S. 90% silver coinage,” Coin World, March 11, 2019

 

Mike Unser, “U.S. Mint Ends Production of 90% Silver Coins,” www.coinnews.et, Feb. 20, 2019

 

https://www.coinnews.net/2019/02/20/u-s-mint-ends-production-of-90-silver-coins/

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