February 9, 2009 – Gold Silver Bullion

Far less renown in numismatic circles than the Australian or Perth Mints, the New Zealand Mint (also known as Te Kamupene Whakanao o Aotearoa in the local language) has been operating in Auckland since the 1960s. It was the first mint to regularly issue coinage at .9999 purity and has issued millions of medals, commemorative coins and bullion at what has become a world standard for quality bullion.

In addition to producing silver fern bullion and gold kiwi gold bullion coins, the New Zealand Mint is renown for creating colourized silver coins, a set of Lord of the Rings coins, Everest coins in tribute to Sir Edmund Hillary, one in honour of New Zealand’s first base in Antarctica, golf greats, small “Fiji” coins made of Fijian gold.

Those looking for more than a single silver coin from the New Zealand Mint, you’ll have to be prepared to pay a set mark-up over the weekly spot price of gold (as has been adopted by the US Mint, as of January 2008) if you want to buy gold bullion. Coins that are issued in small quantities as commemorative legal tender continue to have a fixed price during their year of issuance.

Gold Kiwi bullion coins continue to be the standard gold bullion coin from New Zealand, with several sizes to choose from. Aside from the standard 1-ounce, ½-ounce and ¼-ounce sizes found in the Kiwis, larger quantities of gold, up to 1kg, can be purchased as bars. These tend to be the most common choice for large-scale investors such as banks and other types of paper investments. As such, the New Zealand mint also holds a great deal of gold for its clients, with storage fees charged per ounce.

The gold used in the New Zealand Mint is found in three separate locations across the country bringing in over 11 tonnes per year since the 1990s. There were several 19th century gold rushes on these Pacific islands just as European settlers arrived and noticed. These bonanzas resulted in several boom years during the 19th century, such as the massive output of 22 tonnes in 1866. While much of the stream-bound (or alluvial) gold is found on the South Island, the North Island is home the most productive rock mines, where gold is found in veins along with quartz.

Officials at the New Zealand Mint have stated that the demand for their products has soared in 2008 with the onslaught of the financial crisis, as much as 300% as of January 2009. For numismatists and coin collectors looking to buy gold bullion, coins that hold particular appeal may be sold out or even rationed in 2009 if conditions persist. Indeed, many coins recently available from the early- and mid-’aughts have been listed as sold out in late 2008.

Of course, there is also the conversion factor to consider, and recent movement by the New Zealand dollar has made a lot of investments there look attractive to investors that are looking for safer havens for their money. With a 2008 return on New Zealand gold at a modest 5%, this is in sharp contrast to the 40% losses some investors have suffered on Wall Street and and other types of speculation.

Arthur McGuire

February 9, 2009

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