October 4th, 2014

Rimfire Ammo Shortages — Debunking the Conspiracy Theorists

These days, when gun owners get together, the hot topic is: “Where did all the rimfire ammo go?” For the past couple of years, .22 LR rimfire ammo has been very hard to find, and what you can purchase is priced much higher than before. Is there some conspiracy? Have ammo-makers cut back production? Mark Keefe, Editor of American Rifleman, recently addressed these questions, and the related issue of production capacity.

Keefe observes that, if “normal” demand for rimfire ammo has increased substantially (and permanently), we may not see a big improvement in the availability of rimfire ammo until such time as ammo-makers increase production capacity. But that would require the construction of very expensive new ammo manufacturing facilities. According to Keefe, that’s not likely to happen any time soon because manufacturers will not spend hundreds of millions chasing a short-term demand “bubble”. In Keefe’s view, until the panic buying subsides, and ammo-makers can reliably determine the true, “normal” long-term demand for rimfire ammo, it is unlikely that they will invest in new factories.

Click Graphic to Read Full Article:
Keefe Mark rimfire American Rifleman

Here are some highlights of the Keefe Article on Rimfire Ammunition:

U.S. Rimfire Ammo Factories Really Are Running at Full Capacity
Keefe: “I have been in two of the major rimfire plants in the United States since this ‘crisis’ hit. They are, indeed, running three shifts, full out. But there are not that many rimfire plants in the [USA].”

Increased Rimfire Gun Sales May Justify Increased Production Capacity
Keefe: “There are, literally, millions more .22 Long Rifle firearms owned and shot that have entered civilian hands in recent years…. Variables such as a substantial increase in the number of .22s sold and a change in the type of .22s being shot … may make a new rimfire plant worth it. Time will tell.”

Construction of New Factories is Very Expensive
Keefe: “Would it be worth it to go to the expense of, say, building a $250 million rimfire plant to make your company’s money back at a penny a round over the next 10 to 20 years? The answer, so far, has been a resounding ‘No’.”

Manufacturers Can’t Assess True Demand Levels Until the Panic Buying Ceases
Keefe: “At some point, ammunition demand will reach its real level[.] At that point, the major ammo makers will look and see if there is sufficient demand for [bringing] a new rimfire plant on-line.”

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