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Ammo supply & market distribution. What is keeping manufacturers from meeting demand?

I was curious as to why there has been such a shortage of ammunition as it really doesn't make sense unless there is a law(s) which are unknown to me. If suppliers can not keep up with demand, why has there not been new manufacturers entering the market? Why have current manufacturers not expanded their production capacity to meet the elevated level of demand? This is NOT normal for any other industry.

I think this needs to be examined much closer than what has been done, or maybe I haven't seen the discussions regarding this.

I am aware that Obama wanted (and possibly succeeded) to stop importation of foreign ammo (I am thinking of Wolf ammo for some reason). IDK if this ever happened or if it was for a short period of time. What is the the current situation with this? If there are no imports, this may be why there is such a shortage of ammo as the supply has fallen.

If importation has not stopped then I think this is a serious issue. Either way, there is more demand than supply which is also indicated by the rising price of ammo. So why has there been no new companies producing ammo domestically? Are there laws or regulation barring entry into this market/industry?

I am curious to know why no domestic manufacturers have expanded their production capacity by upgrading lines or opening new plants? I'm sure they are making record profit as prices have seemed to be higher than ever while their costs are basically the same (with exception of slightly higher base metal prices).

So, considering the laws of supply and demand, why have no new companies come onto the scene? Why have existing companies not expanded?

What are your thoughts on this?
 

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Never Give up
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With the new rein of terror

People went out and bought everything up that they could. I pesonally know people who had like 100 rounds now have 30,000 rounds put away. Make that all over the nation and this is what you have. But I would not say it is over we just have a slight reprieve. But after the health care gulag they will do imigration the go for the guns.
 

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Gott Mit Uns
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The supply is low because demand is high. Econ. 101. Manufacturers are going full bore to meet demand. To start a new company will take time and a huge $ investment. When they get up and running ready to make their money back. The are afraid demand will be back down. The market was getting pretty saturated before the latest string of events started the mad rush. With the economy down and credit is tight starting a new company is pretty high risk. Feel free if yuo want to take the plunge.
 

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The shortage was created by panic in the populous. Plants have been running three shifts, full production to meet this demand. Who in their right mind would invest millions into a new facility for a temporary spike in demand? Look around, the panic is subsiding, ammo prices are falling down to near pre scare prices, and the supply is growing. Soon enough, the plants will be laying off worker since they won't need all shifts anymore.
 

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Forgiven
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The election made me realize I needed more range time to figure out what I needed to stock.

As soon as I stop going to the range, the shortage should subside. :)
 

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Hell, there are still a lot of people buying everything in their pet caliber when it comes in.

There's no conspiracy, and producers are doing all they can to keep up with supply.

People are just buying a lot of ammo.
 

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Super Gassy Moderator
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I'm in the firearms industry and can give some insight into what caused this. Right about the time the rush started, I was looking into getting set up for commercial ammo manufacture. I'm signed on with a major reloading component wholesaler and I talked to them about the shortages. I also have a friend from my childhood who has worked at ATK/Hercules for the last 25 years. They both said the same thing.

The major ammo manufacturers were working on filling large military orders at the time. They do that from time to time, but the market doesn't notice, because they generally have enough reserve manufacturing capacity to keep up with public demand also. But this time around, there was an unexpected rush of new gun owners buying their first guns, along with previous gun owners wanting to stock up. It caused a rush on ammo that the companies couldn't keep up with because their reserve capacity was being used to fulfill the military contracts.

These contracts started ending a few months ago, and the companies have been switching more capacity over to making ammo and components for the market again, but there has been a long line of backorders to fill. Not only to ammo wholesalers, but also large component orders to other manufacturers. These get filled first. That causes ammo to start trickling out to the market until all the suppliers get caught up.

My friend who works at ATK couldn't even buy components. They allow employees to buy at a discount, but the demand was outstripping their capacity, so there was no surplus to sell to employees.

That 200 million round order from DHS might slow things again for a short while. I guess only time will tell there. This is a good time to get into reloading though, as components are becoming available again now. It's the only way to afford to shoot high volume or stockpile heavily anyway.

There are a number of smaller domestic producers, but most of them depend on others to make the powder, primers and cases for them. This has been the limiting factor that kept them from being able to produce enough to meet demand. It wouldn't have been a prudent business move for them to invest in more lines, or in producing their own components, knowing that the situation was short term, and that the economy being what it is, would end up taking a bite out of them in short order. Heck, I was doing great at gun shows, but this summer, the economy put me out of business.
 

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Information is Ammunition
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What is keeping manufacturers from meeting demand?

the need to keep prices up
 

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Take heart, Primers are becoming available from more retailers every day, and even my beloved WallyWorld has more ammo on the shelves every day.

Just bought more .223, didn't empty the shelf this time, and they actually still had a box of 50 Federal .45 ACPs for 16.99!

Clerk said more was on the way in.
 
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