The South African Mint Company, commonly known as the South African Mint, manufactures Proof Krugerrands, and jointly manufactures the Bullion Krugerrand with Rand Refinery.

In 2017, Rand Refinery started to mint silver versions, which have the same overall design of the gold coin.

The South African Mint is a wholly-owned subsidiary of the South African Reserve Bank (SARB) and is situated in Centurion, Gauteng.

Rand Refinery in Germiston, Gauteng, is one of the largest refiners of gold globally. 

Range of coins manufactured 

The South African Mint yearly manufactures a specific range of coins. Each coin is limited to a certain number per year. The following sizes are manufactured:

• 1oz Krugerrand coin

The very first Krugerrand minted in 1967 was a 1oz gold coin.

The SA Mint calls it the ‘flagship product of the Krugerrand family.’

It is available for both Bullion and Proof coins.

• 1/2oz, 1/4oz, and 1/10oz Krugerrand coins

These coins were the first fractional coins to be introduced to the range in 1980.

All of them are also available as Bullion and Proof coins.

• 2oz gold proof Krugerrand coin

The 2oz gold coin was launched in 2018.

• 1/20oz gold proof Krugerrand coin

A coin introduced in 2017 as part of the fiftieth-anniversary range. Although, in the 2022 range it is only part of the ‘Krugerrand Prestige Set.’

• 1/50oz gold proof Krugerrand coin

This the smallest coin available in the Krugerrand range and was also launched in 2017 as part of the fiftieth-anniversary range. It can also be purchased as part of one of the Krugerrand sets.

• 1oz silver proof Krugerrand

This is the first silver proof Krugerrand, first introduced in 2017 as part of the fiftieth-anniversary range.

• 2oz silver proof Krugerrand

The Krugerrand family’s youngest member, which arrived in 2022.

 My comment: By 1980, South Africa dominated the gold coin business, 90% of the world’s business was produced by SA. Then the US instituted sanctions against us because of our policy of Apartheid. This meant for the next few years sales of the one ounce coin, largely dried up. The launch of the small coins created a new market.

As already mentioned, the first Krugerrand was minted in 1967, aiming to improve the sales of South African gold and providing a vehicle for private ownership of gold.

The number of Krugerrands minted have varied over the years, depending on the demand, for example:

• From 1967 – 1969: around 40 000 coins.
• 1970: 200 000 Krugerrands.
• 1974: more than one million coins.
• 1978: six million Krugerrands.

Throughout the 1970s, Krugerrands became the prime choice for gold investors worldwide, accounting for 90% of the sales of gold coins globally by 1980.

Prior to 1985, when the United States of America banned the import of Krugerrands due to South Africa’s apartheid laws, the USA imported around 22 million Krugerrand gold coins during 1974 – 1985.

During the 1970s, but specifically during the 1980s, many foreign countries declared the import of Krugerrands unlawful because of South Africa’s policy of apartheid, consequently drastically reducing the sales of Krugerrands.

To boost the sales of Krugerrands locally, smaller coins with respectively a half troy ounce, quarter troy ounce, and one-tenth troy ounce of gold, were issued in 1980.

In the early 1990s, the South African government started political reforms which eventually culminated in a new government in 1994, representative of all the people in the country. This led to the termination of sanctions, resulting in, among other things, an increase in the production of Krugerrands.

Although only just over 23 000 coins were manufactured in 1998. However, investors worldwide began to buy Krugerrands again and their production increased considerably.

In 2017, the fiftieth anniversary of the Krugerrand was celebrated with the issuance of a number of commemorative platinum, gold, and silver coins.

Although the production of Krugerrands has varied over the years, more than 61 million Krugerrand coins have been sold since the first Krugerrand was introduced in 1967.

Undeniably, the Krugerrand is a trusted bullion coin and certainly worth its weight in gold. Indeed, *one of the world’s most widely traded coins.

Worth mentioning, the enormous success of the Krugerrand inspired many other countries to mint their own gold bullion coins, such as:

• the Canadian Gold Maple Leaf (1979),
• the Chinese Gold Panda (1982),
• the American Gold Eagle (1986),
• the Australian Gold Nugget (1987), and,
• the British Britannia coin (1987).

Generally, there are various reasons why investors are attracted to Krugerrands as an investment vehicle, such as its reliability, global liquidity, durability, timeless and iconic design, proven tradability, affordability, and high gold purity.

Being liquid* Krugerrands can be easily bought and sold, allowing quick access to cash.

In addition, Krugerrands offers accessibility to gold, making it easier to own gold. Their small size makes for easy storage.

During times of uncertainty and volatility, such as the Covid-19 pandemic, the Krugerrand offers peace-of-mind, providing financial security that it will retain its value even in an economic cave-in.

Krugerrands appeal to private and professional investors who want to directly invest in gold bullion, diversify their investment portfolios, or to hedge their portfolios.

The true measure of any type of investment’s merit is its historical performance. Regarding the performance of the Krugerrand, the following figures are quite significant, specifically the ones during 2022, the year of the Covid-19 pandemic.

The following Krugerrand prices were obtained from the website of Monex Precious Metals:

An increase of $464.70 or 30.57% since March 20, 2020, a week before the implementation of a hard lockdown in the country.

August 6, 2021 – $2 158. This was the highest price ever for a one-ounce Krugerrand. The price was mainly supported by uncertainty and anxiety about the world economy, impacted by the Covid-19 pandemic and ensuing lockdowns in order to control the effects of the pandemic.

An increase of $609.30 or 39.33 

% from the beginning of 2022, $231.32 (12%) from the previous highest on September 5, 2011 and $1 059 (96.39%) from the lowest price the past ten years on December 14, 2015!

• March 20, 2020 – $1 520. The price at the initial stages of the lockdown in South Africa.

• December 14, 2015 – $1 099. The lowest price in the past ten years.

• September 5, 2011 – $1 927. This was the previous high price before the high of August 6, 2021.
• Today’s price is $1936.

My comments:

Gold may be perceived as being volatile, but in reality, it responds to the circumstances. Both times gold reached its new high when circumstances looked gloomy: the covid disaster and then the Ukraine/Russian war, respectively. Gold pulled back when the vaccine was launched and supposedly the war would be curtailed in Asia. 

We see gold remains a long term good investment, as can be gleaned from the long term chart that remains in an upward rising graph.

The composition of your investment portfolio depends on, among other things, your risk-profile and availability of cash. However, a combination of gold and other asset classes is the perfect balance to an investment portfolio.

Some gold experts recommend that a portfolio comprise 15% to 25% of gold as an asset.

My comments

• To ignore gold in your portfolio is foolish.
• My suggestion has always been 10% allocated to gold. That is best represented by 5% in physicals gold such as Krugerrands and 5% in gold shares (the gold miners). This means the gold in the ground has a gearing effect. The more the gold price increases the greater the gold still in the ground is worth due to a factor that multiplies its worth.
• I understand the investor that does not wish to take risk, he should rather invest 10% in the physical metal only (Krugerrands).
• In times of great uncertainty, and pending economic downturn, an investor who undertstands gold, may wish to increase his percentage to 20%
  

The world of Krugerrands trading is not safeguarded per se. You should be wary of scammers and suspicious trading opportunities. Rand Refinery warn* that ‘coin fraud has been an unfortunate reality in the investment market, as well as the coin collecting marketplace for decades and is very difficult to manage.’

Rand Refinery describes seven methods to enable investors to verify the authenticity of a Krugerrand, namely:

Size: Diameter 32,77 mm x thickness 2,84 mm

Weight: 33,93 g

Magnetic: Gold is not magnetic, easy to test with a strong magnet

Visual: Compare it with a high quality image (as per in the photo attached)

X-ray: Performs a chemistry analysis to see if other elements are present

Ultrasound: it can “see” inside the body of the coin.

Sound: If you drop the coin, you will hear a “ping,” a counterfeit will have a “dull” sound.

Google ‘Testing the authenticity of a Krugerrand coin’, and you will find the document.  

My comments

In all my years of experience I have never come across a counterfeit coin. By observing these guidelines, you will not be “caught.”

My simple test is to know your coin and focus on the fine artwork detail. The horns of the Springbok and the beard of oom Paul are hard to emulate.