A Crash in Ammunition Prices is Coming

By Dean Weingarten

A Crash in Ammunition Prices is Coming
A Crash in Ammunition Prices is Coming
Dean Weingarten
Dean Weingarten

Arizona – -(Ammoland.com)- The Obama caused bubble in ammunition prices seems ready to bust.

Over the last few years people have seen ammunition prices double or triple.

Handgun and rifle ammunition has been hard to find at times.   .22 long rifle ammunition tripled in price over the last 18 months.   People would line up to buy ammunition at prices two and three times the level that they were just two years ago.

All of that is about to change.   Ammunition supply looks as though it is ready to catch up with demand.   Centerfire pistol and rifle cartridges are available on most store shelves.   When I walked into a local Wal-Mart this morning, their were over 30 signs on the ammunition case indicating a rollback of prices by 10-15%.

In classic economic fashion, the bubble was fueled by actions of the Federal government.   Many federal agencies bought enormous quantities of ammunition.  While the quantities were only a small percentage of total production, the raw figures fueled conspiracy theories.  Obama administration actions fueled fear of coming shortages, gun bans, registration of ammunition sales, even potential low level warfare.  All of this led to the current bubble of ammunition sales.

In response, the economy reacted the way that free markets are supposed to work.   Ammunition suppliers started running their manufacturing plants day and night, adding additional shifts.   Importers scoured the world markets, trying to buy everything they could to satisfy the insatiable demand.   Foreign manufacturers bumped up their production to try to fill the desire for more and more ammunition.   Ammunition production was at the highest level ever for small arms, short of war.

But unlike during war, this ammunition was not being fired in combat.   Most of it was not being fired at all.   It was being stored against future need.  Very little was actually being used.

There are limits to this sort of demand.   I gave away a couple of thousand .22 rounds to make a point.  A person who only had 37 .22 shells out of a box of 50 is well justified in wanting a thousand or two, or a case of 5,000 “just because”.    Once they have the 5,000, their desire for more becomes less.   Then demand drops, likely below pre-bubble levels for a while.

In the meantime, manufactures cannot stop production instantly.  They have orders in the pipeline.  They have supplies coming in that they have no storage space for.   They have employees that they have trained and who they do not want to lay off.   For all these reasons, demand drops suddenly, but supply cannot drop as quickly.   As supply took a while to spin up, it will take a while to spin down.

This means that retailers and wholesalers will be saddled with a glut of merchandise that they cannot sell at the current high prices.   They will have to put it on sale.   Lower prices bring about the expectation that prices will fall even further.   The prices crash.

That is when a prudent person buys what they want, at very good prices.   Demand will not stay at the artificially low prices of the crash.   The new crop of urban, hip, shooters will want to feed their equipment, and the new demand will be higher than it was before the bubble, but it will take a while to settle out.

Metal prices have already fallen from the highs of the bubble.  Copper and lead are far lower than they were.    You will know that the bubble is close to the bottom when you see .22 LR on sale for below 4 cents per round.  At the lowest, we might see .22 cartridges below $10 for 500.

Read my newest article “The Ammunition Bubble: Substitute 12 Gauge for .22 Ammo?” http://tiny.cc/twu8gx

 

c2014 by Dean Weingarten: Permission to share is granted when this notice is included. Link to Gun Watch

About Dean Weingarten;

Dean Weingarten has been a peace officer, a military officer, was on the University of Wisconsin Pistol Team for four years, and was first certified to teach firearms safety in 1973. He taught the Arizona concealed carry course for fifteen years until the goal of constitutional carry was attained. He has degrees in meteorology and mining engineering, and recently retired from the Department of Defense after a 30 year career in Army Research, Development, Testing, and Evaluation.

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    Bulletproof Monk.Rolf GreenAndrebig daddyDr. Strangelove Recent comment authors
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    Tom
    Guest
    Tom

    @Marc – being prepared and hoarding is not the same. For those of us who work out of town and/or out of the country, when we do get a chance to be at home and can’t find any .22LR because of the hoarders and price gougers it gets a little frustrating. The airlines frown on ammo in your luggage. But still, Dean W and the posters here have not answered my question about total .22LR production. Also, who cares about the Duck Dynasty boys or Swamp people pictures on the boxes ? Just another excuse to raise the price –… Read more »

    Budro
    Guest
    Budro

    I do hope 22LR returns to reasonable supply and prices soon. I’ve been baby sitting about 400rd for about 2 years sense the gougers keep local shelves empty. While I would like to do more shooting, I simply refuse to pay $80+ for 500 rounds that really shouldn’t cost more than $20.

    bebo
    Guest
    bebo

    Hope you are correct. Every now and then I can buy a box or two of 500 at $25-$28 per 500 online. But they sell out at that price in minutes. 22 lr ammo at the local Walmart, in July 2014, is always sold within minutes of the box being opened. True, shotgun ammo was never hard to find and now, finally, you can find 9mm practice ammo perhaps half the time. Still, folks buy whatever is available whenever it is available. I do not see 22lr returning to $20 for a box of 500/525/555, and that’s what it cost… Read more »

    Marc
    Guest
    Marc

    I have to laugh at those of you that think being prepared is hoarding because you sat around with your heads up your behinds until it was too late. For years I have bought 2 bricks (at least) of just .22 shells every pay day. When the shortage began, I had in excess of 50,000 rounds of .22 shells. I never paid over $12 a brick for any of it and most was $9 or less. I have 3 kids and a wife that shoot also and it is nothing to go through several thousand rounds over a weekend. I… Read more »

    Tom
    Guest
    Tom

    Ok Dean W and you guys. Lets have the production rate of 22LR facts. If we take just one 22LR manufacturer CCI, then what about Winchester/Olin,Remington,Aguila and others… CCI in Utah can produce 4 million per day, that is 88 million per month based on 22 working days which results in 1.056 BILLION per year. Please don’t tell me the HOARDERS and SCALPERS/”middlemen” are no longer at it – they are. Was at a local establishment waiting to purchase 22LR an older gent ahead of me bought the entire available stock he is 83 years old. When i politely asking… Read more »

    Thomashoward
    Guest
    Thomashoward

    Beem down this road before in 70’s and 80’s
    Learned my lessons well and bought a lifetime supply before the panic.
    jus wait until Hilliary becomes pres if you think you have seen high prices

    DO
    Guest
    DO

    Feinstein through her husband is very well invested in the Remington Arms Company and ATK, the parent company of Federal Ammunition.

    When she speaks of gun control, she is playing a card to deliberately get richer. Do you honestly believe she cares if someone dies or not? Panic Buying helps to insure her increasing wealth. Congratulations on all of you who supported Sen.F. on her wealth.

    Tom
    Guest
    Tom

    Wait for it – the next excuse for high ammo prices will be linked to the last lead smelter in Missouri(i think) closing because of our “friendly” EPA. I recall an article here about a month or so ago.

    james
    Guest
    james

    With just about every firearms maker offering .22lr versions of the AR platform for training, that is one main reason for .22lr shortages.

    Prices have been going down slowly, ammoman has dropped prices with free ups shipping but even better deals are available locally.

    1horsecowboy
    Guest
    1horsecowboy

    I stocked up when slick willy was in. I haven’t bought but a few pounds of powder since.
    RELOAD! RELOAD RELOAD !
    I burn up a magpul 2-3 month. I reload when I can’t shoot or there ain’t chit on TV (most times)

    wideglide
    Guest
    wideglide

    shoot one buy two.

    RDNK
    Guest
    RDNK

    @RogerROO,It was Travis saying ammo has a shelf lfe ! What an idiot !

    BlackDog
    Guest
    BlackDog

    I completely disagree. I believe Obama will cause the entire ammo supply to dry up, and then at the very least, create a moratorium on domestic sales of ammunition. More likely, an Executive Order forbidding domestic sales. The ammo manufacturers can still clean up with overseas sales, and sales to the US government. In fact, Obama will probably ‘create’ new markets for overseas ammunition — our tax dollars will fund these markets, perhaps a stockpile of ammunition somewhere domestic. Look at the DoD — they destroyed how many millions of rounds of 5.56×45 because their record-keeping is atrocious and they… Read more »

    RogerR00
    Guest
    RogerR00

    Who is the dumbass who said ammo has a shelf life? I worked for an ammo manufacturer for over thirty years, and the craziness that happened when (probably the same) dumbasses suggested that primers had a shelf life caused shortages for two years. AMMUNITION DOES NOT HAVE A SHELF LIFE IF STORED CLEAN AND DRY. Dumbass!

    ModernSurvival
    Guest
    ModernSurvival

    I don’t know centerfire stuff has been available for a long time the shortages were relatively well, short.

    22LR, man, you still can’t find it certainly at any reasonable price.

    RDNK
    Guest
    RDNK

    I guess Travis doesn’t want to hoard ammo because he is concerned about the shelf life ? Stupid ! Some people think people who buy bulk like I do are hoarders,..NOT !

    RDNK
    Guest
    RDNK

    @travis,yeah ammo has a shelf life ! ,,,,about 200 years ! Modern ammo today would function at least 95% in the year 2214 ! Yeah it has a shelf life !

    Ceapea
    Guest
    Ceapea

    Travis,
    I’m no hoarder, but I think that the “shelf life” will out last most of us.
    I recently finished shooting handloads that my father-in-law loaded back in the 50’s. All went bang.
    Factory ammo is supposed to last longer, all things being equal.

    Kurt goalin
    Guest
    Kurt goalin

    Academy Sports was selling a barrel of 12,500 green tip 5.56 rounds for $4999.00 in November of 2012. Good luck finding it now for anywhere near that price. I can tell you once it gets back there I’ll buy at least one! Don’t get caught without a supply

    Travis
    Guest
    Travis

    For those that hoarded all that ammo, remember, it does have a shelf life…

    Bob
    Guest
    Bob

    The whole idea that this supply thing is getting better is just a scam to get us ready for midterm elections. Don’t fall for their deception.

    HankB
    Guest
    HankB

    Most centerfire ammo(including popular rounds like .223, .308, 9mmP, etc.) is readily available, but prices are a good 30% higher than two years ago. (And .gov says inflation is low!!) Rimfire ammo like .22 LR is generally unavailable – salesmen at the major local retailers (Cabela’s, Academy, Dick’s, WalMart) all tell me the same thing – the incoming supply is a bare trickle. Two years ago they could get a pallet any time they wanted to, today, they’re LUCKY to get a case; often, they don’t get more than a couple of bricks, which doesn’t last long even when they… Read more »

    Tom
    Guest
    Tom

    I certainly hope ammo prices will come down. Was at a BassPro today not one one round of 22LR. There was quite a bit of 17HMR at still 15%+ over “normal”, and some 223 at high prices. And yes other calibers were available also. For you reloaders this store did not have much powder and i did not see any primers. But they had a boat load of shot shells.

    Ron
    Guest
    Ron

    “You will know that the bubble is close to the bottom when you see .22 LR on sale for below 4 cents per round.”

    More like ‘You will know that the bubble is close to the bottom when you see .22 LR … at all.’

    – Ron

    Red
    Guest
    Red

    What Walmart was he at where they had those rollback prices? I need to make a visit there pronto.

    Dr. Strangelove
    Guest
    Dr. Strangelove

    I’m a truck driver and I see ammo on sale at WM’s all over, mostly .223.

    kevin elbrink
    Guest
    kevin elbrink

    I am not sure where this guy lives writing the article but come to southwester Indiana and try and buy rimfire 22LR, .17 hmr, .17 wsm you cant and when they are here you can only buy limited amounts 1-5 boxes of 50.

    TexStan
    Guest
    TexStan

    Online sellers and retailers are responsible for ammo price increases (and gouging) more so than manufacturers. As demand normalizes, so will prices, especially since manufacturing capacity has increased, even if only by process improvement. That said, there are millions more firearm owners than there were before November 2012, much less November 2008. Therefore, there has been a step-change in demand that will likely prevent pricing to return back to those pre-election levels.

    RDNK
    Guest
    RDNK

    Get your orders in early before our govnt buys it all up so we wont be able to !

    okierim
    Guest
    okierim

    maybe they drop some, but obama and demcorats are winding up for more gun control from now until after the 2014 elections….esp if dems make ground in the senate.

    RDNK
    Guest
    RDNK

    @chuck,Only idiots shoot at paper ? You’re the idiot ! I live in the city but I guarantee I hunt more than you do ! I guess all your rifle scopes are zeroed and stay zeroed ! I guess you never try different types of ammo to see which performs best in your weapon. I guess you just never want to do function test before you go hunting ! Thats was really a dumbass thing to say ! The ammo companies couldn’t keep up with demand, its the retailers that screwed consumers.

    Chuck
    Guest
    Chuck

    Only idiots shoot at paper. Unless you live in a city and don’t know how to hit anything, save your ammo for hunting or the revolution. Let the prices drop out the bottom. These ammo makers took advantage of us and need to be taught a lesson!

    Al Del Vecchio
    Guest
    Al Del Vecchio

    Nah, don’t believe it.

    RDNK
    Guest
    RDNK

    I just wanted to add one other point.Both my sons started to double the amount of ammo they shoot at the range,hunting,..etc. If they shoot 100 rds 556 at the range they buy 200 to replace it immediately. Its one of them things you have to stay with and commit to.They both have plenty of ammo and they never have bought bulk like I do either.

    TSgt B
    Guest
    TSgt B

    I think Mr. Weingarten is partially right. I’ve seen ammo prices dropping here in Texas. They may never get back to where they were, but they’re better now than a year ago. I’ve been able to buy over 12,000 rounds of .22 at WalMart prices in the last 10 to 12 months, plus many thousands of rounds of other calibers, just by being at the right place at the right time. And NO, I am not a “hoarder”; I’m just making sure that I don’t get caught wanting. I also reload, and have been able to stock quite a bit… Read more »

    Baracalypse
    Guest
    Baracalypse

    Good. 10,000 rounds isn’t enough.

    Stan
    Guest
    Stan

    This article is based on the presumption that ammo prices have doubled or tripled. They have not. In fact, they’ve gone up about 10%. The rest is all price gouging, mostly from online sellers and retailers. When supply catches up with the inflated demand levels, price gouging can no longer be supported. I am a retailer and do not scalp prices. Our .22 ammo, when we have it, is about 10% higher than last year! not 300%. Center fire ammo is also up about the same amount.

    Noffie56
    Guest
    Noffie56

    It will never be like it once was with the amount of ammo or the price of ammo! We will never again see it, mark my words!

    mark
    Guest
    mark

    I doubt that ammo will ever again become priced as it once was, where the average “Joe” could could take his family out for a weekend shoot and not feel it in the pocket book for a couple of paychecks! Except for .22 LR, I’m seeing ammo on the shelves but local retailers in my area are still rationing it to two boxes at a single purchase time and have been doing so for nearly two years. Does not seem likely to change anytime soon they tell me. Nor, does the price seem likely seem to drop in their estimation.… Read more »

    Ceapea
    Guest
    Ceapea

    I’m right there with ya RDNK.
    I have always said (and actually did it) buy some whenever you find it. Not all, some, every time.
    Doing this has me in ammo and reloading supplies for 10+ years. Probably the rest of my life…maybe.

    RDNK
    Guest
    RDNK

    When green tip M855 get back to $200.00 for 1K it will be back !

    jo
    Guest
    jo

    This guys is talking out of his ass. Elections, mass shootings, EPA… just a few things that will not help the ammo problem and are inevitable.

    RDNK
    Guest
    RDNK

    My fault ? Hows that ? I already had alot of ammo before that ’13 ammo crisis ! (Plus I saw that coming) I’ve alway bought bulk because its cheaper than buying two boxes here and five boxes there. I’m not trying to sound cold but it’s not my fault or problem if other people don’t stock up on ammo esp.when its readily available. If you can’t afford to buy bulk, buy as much as you can,whenever you can.

    mike
    Guest
    mike

    We used to get 550 rounds for 8 bucks here at Wal-Mart just two years ago

    RDNK's Fault
    Guest
    RDNK's Fault

    Hey RDNK its people like you that cause other shooters to not have ammo, hopefully you are not the target when desperate people need ammo.

    RDNK
    Guest
    RDNK

    I’ve got enuf ammo for my firearms to last the rest my lifetime and then some. Buy bulk is the only way to go !

    Janek
    Guest
    Janek

    I’ll believe it when I see it!

    Jeff
    Guest
    Jeff

    I really hope Mr. Weingarten is correct, but I truly doubt that he is, this will be much like gasoline, even though the supply surpasses demand the price never falls below the established “norm”, …may I be forced to eat crow on this one, it will go down easy when chewed along with cheap ammo!!!

    Joe
    Guest
    Joe

    Agree that prices will drop as production ramps up.

    In the case of 22 cal, however, it’s a stretch to blame the Feds.

    MJ
    Guest
    MJ

    Demand for ammo will still remain higher than pre-bubble not because of less hoarding but because there are more gun owners and we all are shooting more.

    In the last couple of years I have been shooting more ammo in a month than I had in the previous 40 years plus I have two sons that are now shooting quite regularly along with my grandson and nephews.

    Robert A
    Guest
    Robert A

    this will be most excellent since I was caught with out ammo when the shelves went bare, now I will be able to catch up 🙂

    Rolf Green
    Guest
    Rolf Green

    But we should still take Hornady out and hang him by his nuts and pimp slap Tim Sundall unbtil he doesn’t know what his own name is. And do not give me the free market crap. There actions were criminal along with all the ammo companies.