To understand the ammo crisis, you must first understand the ammo supply chain aka “The Anatomy of a Pew”
In order to make a bullet go “pew” you need a primer, a casing, powder and a bullet.
Lets start with the “Primer” because that is where the biggest part of the problem lies. There are only four (4) domestic manufacturers of primers in the United States: Federal, CCI, Remington and Winchester.
Like any other business category, primer manufacturing is tooled and equip to meet average demand in an average year for the military, law enforcement and recreational or defensive shooters. It is no secret that 2020 has been a not so average year.
We have seen international lockdowns, the rise of socialism and communist m0vements, violence and rioting in our cities and political uncertainty that we have never seen before.
These things have caused the record sales of over 17 million guns in America this year. The most noteworthy part of that being that according to Smith and Wesson during an investor briefing, over 9.4 million of them or about 40% are first time gun buyers. Most of these first time gun buyers are women, minorities and men that otherwise have never until now felt the need to be able to protect themselves and their families.
Lets pretend for a moment that each of those 9.4 Million first time gun buyers actually wanted to have bullets, magazines and other required items for their new guns.
If each 1st time buyer bought 3x 50 round boxes of ammo, 3 magazines, a red dot optic and a gun safe, bag or holster, that would mean that 1st time buyers sucked up 1 billion, 410 million bullets, 9.4 million red dots and 9.4 million holsters, bags or safes.
Now compound that with panic and frenzy buying from traditional yet unprepared gun owners and you have bullet sales not in the hundreds of millions but in the tens of billions. Oh and lets not forget that the Department of Homeland Security executed all their rated contracts with these manufacturers at the beginning of the year for their fed bois.
Oh yeah and don’t forget that Remington is bankrupt and was sold on the court house steps to Vista Outdoor just the other day.
Internationally, primers are manufactured by several firms in different parts of the world. Armscor in the Philippines, for example, Sellier & Bellot in the Czech Republic, Fiocchi in Italy and JSC in Russia are some of the more prominent companies. Industry insiders have told Tactical Shit that many of these international primer manufacturers were “shut down” for up to two months earlier this year for COVID and are way behind in their own production. We have been told however that international primer shipments should start hitting our shores in October but as of this writing in mid November, that has yet to happen.
Is ammo impossible to find?
No, if you know how to look and where to look you can find ammo. Most of it is not reaching local gun shops and what is, is very small allocations from distributors like RSR, Zanders and Sports South that are doing their best to ration allocations. When you do find this ammo, it will probably be at “regular pricing” and available for very small periods of time with strict limits on per customer purchases.
A few larger players are fighting for allocations of pallets of ammo (mostly international brands) as they arrive in America and clear customs. This ammo currently is going for many times double or more what it cost a year ago.
To understand where we are going, you must first understand where we have been. This awesome data we found in a reddit was pulled years ago from Gun.Deals data and shows you the average cost of popular calibers of ammunition during recent history including the “big years” of 2009 and 2013
As you can see, the most popular rounds by sales volume was .223 and 9mm respectively. .223 hit .68 per round in 2013 while 9mm hit a high of .54 in 2013. Now if you consider that according to ATF and FBI data there were 10,844,792 guns sold in 2013.
They are projecting that we will hit 20,000,000 in 2020 before the end of the year.
That would represent an increase in sales of 84.4% 2020 over “the big year” of 2013.
Currently average ammo price on Ammoseek for 223 is 1.10 per round.
Currently the average ammo price on Ammoseek for 9mm is .84 per round.
If you adjust ammunition costs from 2013 up 84.4% based on demand, it is safe to say that ammo pricing increases at least for the next couple months could continue to rise to as much as an average of $1.25 for .223 and an average of .99 for 9mm
Our forecast is that ammo prices will rise an additional 12-25%
The good news is, the primers will land. The manufactures currently backordered in the billions will catch up. But the future is uncertain and it will be years before we see “the good ole days” of ammo prices again.