The last few years have been an interesting time for ammunition manufacturers, to say the least. If you remember shopping for ammo in 2020, you might recall shoppers lined up around gun stores waiting for limited supplies.
Some retailers even imposed rations on their meager stock, restricting how much of a given ammo type a patron could buy. Finding bulk ammo at your local retailer was virtually impossible.
While the situation has improved somewhat, ammunition manufacturers in USA markets still face tall challenges. And it’s not only COVID that’s impacting ammunition production in 2022.
To get a better sense of the big picture, let’s take a look at the changes the industry has seen in recent years, and how they’re affecting the price of ammo and its availability.
Challenges Facing Ammunition Manufacturers
Ammunition manufacturers have enjoyed massive financial gains thanks to the surge in gun ownership. But that success has not come without its pitfalls.
The industry faces challenges on multiple fronts. These are only a few of the main forces impacting American ammo production.
The Remington Bankruptcy
You could make the case that the ammo shortage started back in 2018. Remington, one of America’s most venerable gun and ammunition makers, was forced to file for Chapter 11 bankruptcy protection.
The move caused a drop in investment and revenue, and Remington couldn’t keep up its previous level of production. Customers flocked to other manufacturers, who struggled themselves to keep up with the sudden demand. This would be a preview of things to come.
In 2020, Remington filed for bankruptcy again. This time, the brand struggled to find relief and their assembly lines would go dark right as the COVID pandemic started to kick in.
The COVID Pandemic
The loss of Remington’s production capabilities would have been bad enough. But as most states felt forced to implement lockdowns, many non-essential industries were put on hiatus. And that would often include ammo makers.
Even a brief halt can be enough to trigger a run on guns and ammo. Before long, 9mm handgun rounds, .223 Remington and 5.56mm rounds for AR rifles, and popular hunting rounds like .308 and 30-30 Winchester were flying off the shelves.
To make matters worse, there was almost no imported ammo coming into the country at the time. What few imports did get through faced delays as long as 6-12 months.
While the supply chain issues are beginning to improve, new variables are now in play. Following the Russian invasion of Ukraine, the U.S. issued sanctions that restrict the import of Russian goods like ammunition. The government has also issued bans on ammo imports from countries like China, among other nations.
No foreign ammo meant consumers had to rely on the dwindling domestic stock, which only helped drive consumer anxiety. And the inability to import foreign ammunition wouldn’t be the only supply chain issue.
The Copper Shortage
One of the biggest hurdles manufacturers are dealing with is an ongoing copper crunch. The metal is used in everything from air conditioners to coinage to electric vehicles. And it’s one of the most important raw materials in bullets.
Copper prices skyrocketed in 2021 and remain high now. Ammo manufacturers have to compete for supplies with everyone from Tesla to the U.S. Mint. As long as the metal remains in short supply, we can expect ammo to do the same.
Surges in Demand Exacterbate Shortages
Reduced ammunition production would have been enough to drive up prices. But compounding the issue is a surge in demand for guns.
In 2020, 20% of all gun purchases were made by first-time buyers. That surge just so happened to begin around March, right as the first wave of the COVID outbreak was starting to take effect.
So you have a diminished supply of ammunition, to begin with. Then all of a sudden you have millions of new gun owners. And then COVID exacerbates all of these challenges even more.
Those factors alone probably would have been enough to ensure an ammo shortage in the intermediate-term. However, demand for guns has not slowed. According to the FBI, the number of background checks carried out for prospective gun owners continued to rise in 2021.
And the demand shows little sign of slowing as we enter the second half of 2022. Domestic ammo production has more-or-less recovered from those early pandemic days. But at the same time, sanctions against Russia, restrictions on Chinese-made ammo, and ongoing supply chain issues mean that the supply of imported ammo remains crimped.
The result is that ammo remains more scarce than it normally would be. It’s for that reason that ammunition manufacturing companies are doing everything in their power to ramp up production.
Efforts to Boost Production
A 2021 article by West Virginia Metro News noted that Vista Outdoors was working overtime to increase production. Vista Outdoors is the firm that bought Remington after its 2020 bankruptcy.
Remington’s bankruptcy was a major contributor to the 2020 ammo shortage. Whether there had been a pandemic or not, the gun and ammo giant’s assembly lines would have sat idle while the court decided the firm’s future.
Now that Vista Outdoors owns the company, they’re working to get those factories back on line. At the same time, firms like Ammo Inc. broke ground on a massive new facility in Wisconsin with other suppliers following suit around the country.
The problem is manufacturers are struggling to bring these locations online fast enough. Vista Outdoors plans to not only reopen Remington plants but retrofit them to produce new calibers and ammo types. And building a new plant like Ammo Inc.’s is no small feat.
These efforts take time, and we’re only now starting to see the dividends. Meanwhile, demand has continued to grow while the supply of surplus and imported stock dwindles. So while manufacturers are making progress, the fact that the gap was able to get so wide in the first place means they’re still playing catch-up.
Long-term, the prognosis for ammo production is good. New domestic production and the hope of increased imports should help drive prices down. But in the short term, we can expect the shortage to last through the end of the year, at least.
The Future of Ammunition Manufacturing Companies
“It’s easy to see, but hard to foresee,” Ben Franklin said. And so it is for the future of ammunition manufacturers.
Despite strides to meet rising demands, raw material shortages, supply chain issues, and the war in Europe remain problematic.
That’s why to insulate yourself from market instability, you need to invest in an Ammo Prime membership.
Your membership gets you an 8% discount and free shipping on every order, helping to cut rising prices. Plus, we’ll send you priority alerts when new stock arrives, giving you an advantage over other buyers. Join now and start saving today.