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.
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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.”
They will invest in more production capability when the sale of adult air rifles begins to exceed that of rimfires.
Poorly run industry. You don’t see this with other products.
Charlie has a point about adult air guns. I’ve been into them for two years now since the big ammo fiasco, and I’ve spent more in a shorter period than I ever did with powder burners, over $1,500 on one rifle.
The gun makers have put their toes in the water with branded lower priced Chinese break barrels, but if smart will delve more deeply into quality items such as those produced by the European makers.
I also think that the ammo makers should get into the market for quality pellets, although I have a feeling that if they do so the prices unfortunately will rise.
Airguns are great fun, from CO2 BB pistols all the way up to PCP benchrest, field target competition, or big bore hunting.
Simple answer, “Hoarders”. Started with a few, now you have to buy all you can when you can find it, if you want a reasonable chance of being able to shoot on a semi-regular basis. Turns everyone into a hoarder. I’ve just started shooting my centerfire guns that I can find ammo for more often, trying to reduce my contribution to the problem.
Using the Sierra VP’s estimate of 25 million rounds per day and Keefe’s $.01/round increase you get that the plant would be almost completely paid off in 3 yrs. This industry just can’t see the truth. They don’t even consider the growth in competition shooting reported here recently or the increase in firearms sales. All being held back because they still think this is panic buying. Shameful.
Self fulfilling prophecy, Rimfire rifle sales will crash, when people realize that the ammo makers are unwilling to supply the bullets they need. Why buy something that can’t be used.
From CMP: Prior to 2013 CMP received deliveries of truckloads of ammo within a few weeks of placing orders. We are now being advised, as in the case of Aguila .22, that it may take several years to receive all of the 35,000,000 rounds of Aguila ammo we have on order.
I have said this before.
People who used to have a box or two on their shelves now are trying to keep a brick or two.
People who used to keep a brick or two on their shelves are now trying to keep a case or two.
People who used to keep a case or two are now trying to see how many cases it takes to get the floor to sag.
When the demand for a product increases tenfold also with increased usage, it is going to take quite awhile before supply gets close to demand.
But lately there is more and more showing up in the local stores and gunshops. Not a lot more, but it is showing up with greater frequency.
The 250 million is way to high of a number for a ammo plant to increase production, that price might be for a completely new multi caliber, multi line plant.
Keefe is an apologist for a lame industry. Because people want ammo, they are the problem? Here is a copy and paste from an article on ammo shortages, this site, dated May of last year.
“One reason is that domestic ammo manufacturers are already operating at full capacity — and they have been doing so for the past decade or so.”
When there isn’t enough ammo for kids to shoot their 22’s, interest in shooting will drop. Then I suppose the manufacturers will be happy they can meet supply.
How can you hoard something thats not available. Let along buy cases of it.
When it is found, more people have been engaging in hoarding-like behavior so they don’t have to rely on camping in front of the gunshop or sportinggoods section of Wally World (again), rather than picking it up as they need it.
Conspiracy theories are still a LOT more fun around the campfire.
Guy said it all, it is a poorly run industry.
The past few years have been a wonderful opportunity for one to start a business in manufacturing 22LR ammo especially slightly outside of the US where the EPA is not involved.
I don’t really blame the manufacturers for holding off on building new production facilities. Look at the black gun market. Lots of people spent lots of money adding capacity and stock, and now many of them are going bankrupt. The big companies that survived are showing losses and dumping them cheap. It’s easy to say that it will quickly pay off, but the reality is generally not the case. Especially when trying to do everything fast to beat the market time.
The other thing to consider that is not factored in with building a new ammo manufacturing facility is the cost of people to work there. Although it would help in unemployment, there is the cost of salaries and benefits to factor in the total cost.
just quit hoarding.
Looks like Eley might be stepping up production soon, due to some shenanigans in the financial sector. That, or getting disbanded and spread to the winds. Never know with those Wall Street-types.