The United States Mint keeps issuing new iterations of proof coins. Some are new designs and concepts, others are reboots of coins from decades past. One coin that stands out in the proof coin business is the U.S. Mint’s annual issuance of the American Eagle One Ounce Palladium Bullion Coin. What stands out here is what the real driving force is behind the supply and the demand for these proof palladium coins.

When it comes to general economics and investing in anything, supply and demand are supposed to play a role (well, outside of Dogecoin anyway). The American Eagle One Ounce Palladium Bullion Coin is said to be in limited supply, but the runs are actually large in the mintage counts and the supply from past years has not been entirely absorbed.

So, for $3,050.00 is the American Eagle One Ounce Palladium Bullion Coin is a good or bad investment?

According to the U.S. Mint announcements for the coins, it introduced an American Eagle One Ounce Palladium Bullion Coin in 2017. That was followed by a collector version palladium proof coin in 2018 and a reverse proof coin in 2019. Get used to the references of .9995 palladium. The descriptions also note:

The obverse (heads) of this design features a high-relief likeness of “Winged Liberty” from the “Mercury Dime” obverse designed by world renowned designer Adolph A. Weinman. In keeping with the original coin, inscriptions are “LIBERTY,” “IN GOD WE TRUST,” “2020,” and Weinman’s distinct initials.

Still, there is a reason to question if this is a good investment or not. Keep in mind that the U.S. Mint’s site has the American Eagle 2021 One Ounce Palladium Proof Coin (Item Number 21EK) for sale at $3,050.00. It has a proof finish and each coin is classified as .9995 palladium. Each is minted at the West Point Mint and the “limited quantities” are 12,000 for each the mintage limit and for the product limit. It also shows that the household order limit is “None.”

And here is where the debate about a “good investment” comes to mind. The U.S. Mint also has a American Eagle 2020 One Ounce Palladium Uncirculated Coin and a 2019 American Eagle 2019 One Ounce Palladium Reverse Proof Coin. Each coin is he same exact price of $3,050.00. Details have been provided below.

American Eagle 2020 One Ounce Palladium Uncirculated Coin… “For the first time, the American Eagle Palladium Coin has an uncirculated finish.” The coins are made of the same .9995 palladium content from the West Point Mint and the “limited quantities” translated to 10,000 in the Mintage Limit and Product Limit: 10,000. And the coin’s household order limit is also “None.”

As for the American Eagle 2019 One Ounce Palladium Reverse Proof Coin (19EK), the Mint noted “For the first time, the 2019 palladium coin has a reverse proof finish.” The coin has the same .9995 palladium content, minted at the West Point Mint, and the limited quantities were shown to be 30,000 for the mintage limit and for the product limit. And the household order limit is the same “None” all for the same $3,050.00 price.

Perhaps the issue about the price with supply and demand comes down to the grading of the coins. These do come encapsulated in plastic, with a box and letter of authenticity. What they do not come with is a formal grade. Several other sales are up for offer from the usual suspects when it comes to reputable sellers:

• APMEX 2020-W Burnished Palladium Eagle SP-70 PCGS (FDI, Black Label) for $4,295.00 in any quantity
• U.S. Gold Bureau 2019 Palladium American Eagle Reverse Proof 70 Coin (NGC, and Hand signed label by Ed Moy, 38th U.S. Mint Director) for $5,636.00

As far as the price of one ounce of palladium on the spot market today, that depends on the source because the commodity price has fallen sharply in recent days. Kitco.com showed a $1,962.00 bid and $2,112.00 ask. SilverGoldBull.com showed a bid of $2,018.20 and an ask of $2,068.20. The site for the CME Group showed palladium futures with a last trade of $2,022.00.

Is it fair to ask if the price of a new proof coin that is readily available should be priced at $1,000 over the spot price of palladium? That is up to you to decide. And before giving too much credence to the question, no one who collects baseball cards and basketball cards asks what the value of raw cardboard is on any given day. And a final reminder or lesson, the proof coins of today are quite different than the proof coins of the 1800s.