To commemorate 50 years of excellence in producing this stunning gold coin, the South African Mint will release several exceptional world premieres: the first 1 oz. Silver Krugerrand (released on December 5th, 2016), the first 1 oz. Proof Platinum Krugerrand and the first 50 oz., 5 oz., 1/20 oz., and 1/50 oz. Proof Gold Krugerrand.
Some investors may be confused by this Bullion Exchanges announcement because they may have thought there were already silver Krugerrands in the market. Unfortunately before December 2016, there were many counterfeit silver Krugerrands floating around.
What’s so special about the Krugerrand? According to South Africa’s Rand Refinery, the Krugerrand was the world’s first ounce-denominated gold coin:
During the late 1960s and early 70s, when South Africa’s annual gold mine output averaged 75% of total output in the western world, the promotion of gold was considered vital, following the final collapse of the Gold Standard in 1971.
The chosen vehicle to drive the demand was the Krugerrand, which was developed in the 1960s by the Chamber of Mines of South Africa, working closely with the South African Reserve Bank and the South African Mint.
These Krugerrands were the first gold bullion coins designed to be a convenient way of owning some of the South African gold. Now, owning precious metals may become even easier with the addition of the silver and platinum coins. However, that may mean that there will be a flood of new counterfeits on the market as well.
The South African Reserve Bank specifies the 2017 silver Krugerrand to be R1, 1 oz, fine –silver, 38.725mm in diameter, and 31.107g in mass. The 2017 platinum Krugerrand must be R10, 1 oz, platinum, 32.69mm in diameter, and 31.107g in mass. The coins will feature the same design as the original Krugerrands, except for the content engraving. Also, the reverse designs for both the Platinum and Silver Krugerrands will bear a small privy mark reading “50” in honor of the half-century anniversary. The privy is placed just above the image of a springbok, an antelope that is one of South Africa’s national symbols.
Pawn shops are going to have to be extra careful in making sure that these Krugerrands are real. We have already written about shop owners being fooled by fake silver coins. The coin, that was purported by the customer to be a genuine silver collectible piece, turned out to be made of lead and nickel. It was an almost flawless copy, and even came in its ‘original’ holder. Luckily the pawnbroker took the coin to a refiner who used an X-ray fluorescence (XRF) analyzer to verify the precious metal composition while it was still in the holder. XRF analyzers provide a fast, accurate, and most importantly, a nondestructive method to test the purity and composition of all precious metals. XRF quickly provides the exact karat weight and percentages of all elements within an item – easily identifying non-standard, under-karated, and even advanced counterfeit material that acid testing is incapable of differentiating.
If counterfeiters can produce a high-quality ‘silver’ coin out of worthless lead and nickel, one can expect the silver and platinum Krugerrands will be next. There are many techniques and tools the numismatic industry uses to test precious metal content. We previously wrote about several numismatic testing methods, including:
- The ping test, in which the coin is struck with a piece of metal. Based on the sound reflected, information can be ascertained as to whether a coin is alloyed or consists of a high concentration of gold or silver (the pure, or near-pure gold will make a dull non-lasting sound, whereas pure silver produces a sustained ring.
- Acid tests are often used to determine precious metal content. The acid test, however, is not accurate, does not reveal the actual concentration, identify any alloying elements, nor indicate any plating. The acids used are corrosive and require special protection, and could damage the coin.
- Fire assay is one of the oldest methods to verify precious metals content. However, the gold must be destroyed/melted down to be analyzed. That’s the last thing you want to happen to your collectible coins and Krugerrands.
- With XRF technology, each of the elements present in a sample produces a unique set of characteristic x-rays that is a “fingerprint” for that specific element when illuminated by primary x-rays. XRF precious metal analyzers determine the elemental composition of a sample by measuring the energy of the characteristic x-ray emitted by the different elements in the sample when it is illuminated by primary x-rays. The elements present in the sample and their relative concentrations can be quickly determined. Almost instantly you will have an accurate purity analysis for on-the-spot sorting and valuation of gold, silver, and all precious metals…as well as quantification of other desirable and undesirable elements.
You can read more specifics about these testing methods in the application note: Adding Value to the Numismatic Profession with Portable XRF.
These new Krugerrands are bound to be highly collectible, so they may soon be coming to a jewelry or pawn shop near you. Before you make a deal to purchase the piece, however, make sure you have thoroughly tested it.