(Reuters, reporting by Jan Harvey, Frank Tank, Euan Rocha, Michael Shields) - Demand for gold coins fell in key markets in the early part of this year as the strong demand for small investment products that helped send bullion prices to record highs in 2011 tailed off, sales data from three major Mints showed.
The United States, Canadian and Austrian Mints, which between them produce three of the world's top five bullion investment coins, all reported lower sales in the first quarter of 2012 versus a year ago.
Combined sales of U.S. American Eagle, Canadian Maple Leaf and Vienna Philharmonic gold coins fell by more than a third to 451,113 ounces in the three months to March.
The Royal Canadian Mint, which produces Maple Leaf coins in gold and silver, saw the biggest drop in gold sales, which were down 46 percent to 160,000 ounces from 296,000 ounces.
"The Mint cannot predict the precious metals market," it said in an annual report.
"Performance of the Bullion and Refinery business should remain competitive although, overall, markets are expected to remain considerably weaker than in 2011."
Sales of gold American Eagle coins fell nearly 30 percent to 210,500 ounces, while those of Austrian Philharmonics dropped by 39 percent to 80,613 ounces in the first quarter.
In a report, metals consultancy GFMS said sales of official coins rose 15 percent last year to 245.5 tonnes, their highest since 1986. Early indications suggest demand may be softening.
Buying of gold investment products, predominantly bars, but also coins, helped fuel a rally in gold prices that took the precious metal to record highs at $1,920.30 an ounce last year. They have since fallen around $350 an ounce.
This year's volatile gold prices, which have already given up the bulk of their gains for the year after a strong January, are likely to keep more risk-averse buyers on the sidelines.
"Last year was a tremendous boom year," said Miguel Perez-Santalla, vice president of purchasing for APMEX, one of the US Mint's national authorized dealers. "I don't expect that we will be reaching those levels this year.
"But I do expect that that we are going to see a much better performance in the second half of the year, predominantly as European economic scenarios continue to decline, which will drive more people to investing in gold bullion coins," he added.
A spokeswoman for the Austrian Mint said its silver coin sales had also dropped 27 percent to 2.293 million ounces. "After the silver price in February fell so extremely, demand sank," she said.
Silver American Eagle coin sales from the U.S. Mint also fell by 18 percent to 10.139 million ounces in the first quarter. Demand for silver coins and medals hit a record high at 118.2 million ounces last year, according to GFMS.
Spot silver has underperformed gold this year, currently down around 2 percent, compared to a 0.8 percent rise for gold. It posted a near 10-percent price drop in 2011 after hitting record highs near $50 an ounce in April, and is currently below $28 an ounce.
Gainesville Coins is offering the U.S. Mint's 1 oz Silver American Eagle at as low as $2.45 over spot. Gainesville Coins is offering the Royal Canadian Mint's 1 oz Silver Maple at as low as $1.95 over spot.