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1931-S Buffalo nickel pricey in low grades

There is reasonable doubt as to how high the 1931-S can go.

The 1931-S Buffalo nickel has been on a roll lately, at least in circulated grades. Its G-4 price of $16 may not seem like much, but back in 1998, it was just $3.75. Even if you do not normally think much about G-4 coins, you have to admit that such a price increase is far from insignificant.

There is reasonable doubt as to how high the 1931-S can go, especially when you consider all grades, as the coin is a lower-mintage date from a complicated time and one where we do not fully know the amount of saving in certain grades of a number of key issues.

At the time of the coin?s release, the nation was falling deeper and deeper into the Great Depression. Only lower denominations were produced and the 1931 cents were low mintage, especially the 1931-S, which was at 866,000.

The dimes were also low mintage and the 1931-S Buffalo nickel, the only Buffalo nickel of the year, had a mintage of 1.2 million, which was one of the lowest mintages for a Buffalo nickel.

The 1931-S situation makes you question how heavily it was saved. It is not priced much higher than higher-mintage dates from the period, while in Mint State, it shows values of $65 in MS-60 and $315 in MS-65, which is a good deal lower than higher-mintage dates such as the 1934 or 1934-D.

If the 1931-S was heavily hoarded, that could have resulted in a smaller supply in circulated grades. The problem is that 1931 was a complicated time. We know that the 1931-S Lincoln cent was heavily hoarded and with good reason. Every other small-size cent with a mintage of less than 1 million, including the 1877, 1909-S and 1909-S VDB Lincoln cents, had all moved to higher prices on the basis of their low mintages.

The 1931-S Lincoln cent looked like a sure winner and the hoarding started quickly with one report being that as much as a quarter of the entire mintage ended up in one hoard. Even if that total turns out to be high, there is no doubt that the 1931-S was heavily hoarded and that means that there are few inexpensive low-grade examples. It also raises the question if the same thing could have happened to the 1931-S Buffalo nickel.

Additional suspicions might be raised by the low price of the 1931-S in Mint State, where it lists for $65 in MS-60 and $315 in MS-65. In both cases, for a 1.2 million-mintage coin, you have to think the price is very reasonable.

The grading services support the prices, as NGC has seen more than 625 examples of the 1931-S in MS-65 or better, while the PCGS total is around 1,275. Both of those totals are not high for a coin of the 1930s, but they are high for a coin with a mintage of 1.2 million.

It leaves us with a couple possibilities for the circulated grades. Perhaps with so many saved in 1931 and with additional numbers lost because the date wore off, as often happened with Buffalo nickels, the supplies in lower circulated grades are not very good and higher prices are in order.

On the other hand, the 1931-S was a later date. It should have had minor losses because of dates wearing off, as a generation of collectors was appearing that would, unlike collectors of the early 1900s, pull the 1931-S from circulation before the dates disappeared. What may be at work is a group of buyers who, not understanding the factors at work, look at the low mintage and make assumptions without fully comprehending the situation. Whatever the reasons for the price increase, the 1931-S remains an interesting date worth watching.