Safe Haven Meets Safe HarbourBy Terry Hanlon, President and CEO, Dillon Gage Metals
It’s not just your imagination. Our industry is gradually returning to normal, or at least a new normal. The past year once again saw a rush for precious metals products among investors, but the massive demand we have seen since 2020 finally began slowing down. Starting in November 2022, volumes kicked into gear, giving dealers some breathing room, with the emphasis on “some”.
Helping our clients catch their breath is our specialty. At Dillon Gage, we assist our clients in restoring calm and balance, moving beyond the pandemic pandemonium that has driven safe-haven investing. We provide a safe harbour for dealers with efficient systems, friendly expert staff, and transparent communications. Frankly, we are at our best when business challenges are at their worst. We excel at working the problem.
Of course, as the yellow metal continues to hover around the $2,000/oz. threshold, the demand for fabricated products remains high. Nothing indicates that this appetite will be satisfied any time soon. Unfortunately, the bottlenecks and slowdowns remain. Allocations are still in effect from the sovereign mints and several private mints as well. There are signs that volumes will begin exceeding the output of the past three years in silver, gold, and platinum, as well
The precious metals industry has also been affected by the staffing shortages that have impacted other industries since 2020. While Dillon Gage isn’t immune to broader trends, we’ve always worked to maintain our expert staff, so we have overcome this obstacle, enabling us to reduce the delays we experienced in the early days of COVID. However, global logistics and shipping channels are still facing challenges with high volume demand and cargo space under pressure. It has improved over the past few months, but there’s still a need for further availability.
There is good news from the source of precious metals. Our refinery is seeing strong volumes from mines and even the scrap metal side, which slowed earlier in the pandemic. Currently, we see no interruption to the available raw metal and don’t expect to see that any time soon, but we predict the ongoing heavy demand will continue testing the supply chain through 2023.
At Dillon Gage, we continue to hone our services, maintaining the best possible solutions for the industry. We focus heavily (and successfully) on distribution and fulfillment to avoid the delays seen earlier in the pandemic that became excessive due to major logistics challenges, both internally and with transportation, globally.
Dillon Gage’s trading, accounting, and distribution teams provide an exceptional job of communicating with our customers and FizTrade.com, our trading platform that provides immediate access to customer transaction and trading status. FizTrade also provides detailed analysis to the customer as well as our various departments, from trading to distribution. Efficiency is a top priority.
Our independently operated storage subsidiary, International Depository Services, located in Dallas, Texas; Wilmington, Delaware; and Toronto, Ontario, Canada, is seeing rapid growth in this environment, notably in individual retirement accounts.
While the potential banking crisis, the geopolitical strain between global superpowers, and the energy crisis are likely to keep demand strong in the coming months and years, we foresee a strengthening supply side that will keep premiums in check.
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