Naturally, you don’t want to spend tons of money building new equipment for a short-term shortage that may be over by the time the new equipment comes on line... but is there any move to increase capacity?
I think the panic is over and supplies will start to catch up with slowly decreasing demand.
I just got 9 boxes of 9mm from Wally World the other day. I felt like I won the lottery, so I see it improving out there.
I'm not happy about IRS agents and homeland security buying so much ammo when the nation is running huge deficits, but let's be real: the feds use just a very small fraction of what's out there in .223 or 40 S&W. Their use of these calibers is not the cause of the shortage, it's the panic that their policies create.
There is something they can do (and what a lot of mfrs are doing). They can expand manufacturing capability buy building new machines and hiring more operators.
If I were a manufacturer, I would be making as much right now as I could. I would not expand production by buying new equipment etc. as before long the panic will stop and they would be left with idle machinery.
‘There is NOTHING they can do to produce more. ‘
Thats false. There’s a lot that can be done and at least one firm has reportedly acquired extra mfg space and machinery. We can also import more from extra capacity abroad. The article incorrectly sees the situation as static.
For the last year or so I have been seeing large semis going by packed to capacity with pine stumps. They are always headed East and there are at least two a week.
I have no idea how gun powder is made but I do know that pine stumps are used. Before this year I had never noticed them.
I did see a Florida Transportation Cop stop one almost right in front of my house and pull out portable scales. They do appear overloaded but that might just be what it looks like.
For many folks ammo is just as important of a daily commodity as gasoline so it’s very likely to turn out to be like the gas price game; keep raising the prices until it becomes obvious the market flow has declined. A box of 22LR in early 2012 was $1.50 per 50 rounds, today it costs from $12 to $15 per 50 rounds. This proves people are willing to pay the high price, just like they did when gas went from $1.75 / gal in 2007 to today’s price of $4 / gal. Gas went close to $5 / gal at one time and market declined and then settled around $4. People felt relieved by the $1.00 dip in the price and adjusted accordingly. I could be wrong but I expect the same will happen to the ammo market.
One of the issues:
Wholesale purchases by on-line retailers, to then sell at a premium have to be way up. A large number of the retailers just got in the business in the last five years or so. I would imagine that the purchases by these retailers are fifty times what they were in 2003 a decade ago.
They appear to have the supply and are selling at double the normal price in many cases. If they had 50 percent markup previously, now they are getting triple the markup.
What on-line retailer would not increase his purchases ten fold if he can sell at that number. This makes a big supply demand as those retailers increase inventory ten fold.
The result is a whole new group of middle men that weren’t in the market a decade ago, all of the sudden seeing good profits and then increasing their demand ten fold. Voila, a market shortage spike.
I just shelled out $15.99 for one box of .22 mag yesterday at Bulls Eye. I told Mr. GG2 I think we have enough ammo for awhile. Its getting ridiculous. As soon as the shortage problem goes away prices will come back down.
Hmmm, let's think on that for about a fraction of a second. How about not signing a government contract for ammo and hiring more employees to have the company producing 24/7?
The shortage is doing wonders for tourism (little irony there), and with the length of the shortage, firearms sports will decline.
When (if) the supply and price of ammo returns to ‘normal’ (pre-Obama) levels I don’t expect it to stay there.
Compare the investment return on ammo stockpiled a few years ago with the return on savings accounts or CD’s in the Obama era (negative return when acounting for inflation).
Ammo has been by far the better investment.
The same can also be said for storable food (canned, dried, etc.) and household necessities.
If we survive the Obama era we will be saddled with enormous built in costs on energy, medical care and other wealth redistribution schemes as part of his legacy. So any return to a pre-Obama economy and prices just isn’t going to happen.
Ammo and other supplies and necessities will be increasing in cost for years to come thanks to Obama and his wealth-redistribution scams.