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Following news last week that the U.S. Mint had run out of its initial production of 2013 Silver Eagles, reports were circulating on industry blogs that the Royal Canadian Mint was next in line after suffering a silver shortage.

Confirming this strain on physical silver supplies, the mint this morning went on allocation, limiting the quantity of sales of the popular Silver Maple Leaf coin.

"Due to very high demand for Silver Maple Leaf bullion coins, the Royal Canadian Mint is carefully managing supply to ensure all our bullion distributors are served and we continue to take orders," Alex Reeves, senior manager, communications for the Royal Canadian Mint, told Kitco News this morning.

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Peter Hug, global trading director for Kitco Metals, offered this explanation: "The mints tend to want to be out of a specific year prior to offering the next year dated coin. I suspect in October, the mints looked at the current demand, their stock and anticipated some year-end demand. When that demand failed to materialize in November and early December, I think they reduced their production for 2013 release assuming that the demand would continue to be lukewarm."

When the metals popped after U.S. officials reached a fiscal cliff deal, they were caught short with produced inventory, said Mr. Hug.

The U.S. Mint suspended sales of its newly minted 2013 American Eagle silver bullion coins after its supplies were depleted due to soaring investor demand.

"Investor concerns really had risen at the end of last year," said Mu Li, an analyst with the New York-based research firm, CPM Group.

"You can see this in the silver coin sales data from the Mint. In November 2012, the monthly sales of silver coins were more than double the previous November. In that period of time, this surge in demand was pretty much unanticipated by the mint and there were some strains in supply of silver blanks," she said. "In January we will probably see all-time highs of 7 million ounces of Mint silver coin sales."

Li said that it is typical to see seasonally high demand in the month of January. As of Jan. 15, Silver Eagle sales exceeded 5 million ounces and were on track to surpass the all-time monthly high of 6.1 million ounces, set in January 2012.

Sales to authorized dealers are expected to resume on or about the week of Jan. 28 after the U.S. Mint has replenished its inventory, it said in an email to authorized dealers.

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