ZeroHedge on Ammo

The #1 community for Gun Owners in Indiana

Member Benefits:

  • Fewer Ads!
  • Discuss all aspects of firearm ownership
  • Discuss anti-gun legislation
  • Buy, sell, and trade in the classified section
  • Chat with Local gun shops, ranges, trainers & other businesses
  • Discover free outdoor shooting areas
  • View up to date on firearm-related events
  • Share photos & video with other members
  • ...and so much more!
  • Squander

    Marksman
    Rating - 100%
    41   0   0
    Jun 27, 2014
    219
    28
    South Bend

    Suggestion is that inflation provides a cover for price increases that are actually going to profit. And we're paying the prices. Perhaps it's time to stop buying, and to let the inventory build up at the factories.
     
    Last edited:

    2in1evtime

    Master
    Site Supporter
    Rating - 98.4%
    61   1   0
    Oct 30, 2011
    3,444
    113
    retired-midwest
    It is definitely a profit driven drive by the ammo makers and the makers of components, primers from 3 cents to 10 plus cents, powders up to 35% increases, bullets and lead prices way up too, thinking component prices are high just to get people to purchase the ammo they make!!!!!!!!!
     

    Brian's Surplus

    Expert
    Site Supporter
    Industry Partner
    Rating - 100%
    4   0   0
    Jul 18, 2016
    862
    93
    Howard County
    I think it's as much the middle man that's jacking the prices.
    That's certainly true in some cases, but have you been paying attention to all of the price increases levied by the manufacturers? Vista has been raising prices multiple times per year. I use the same formula to determine retail mark-up that I have since before the shortages. Primers were $33 for basic ones up to $58 for bench rest back then, they are $65 to $125 now. Pretty much double.

    Powder has been going up quarterly. We just got hit with an increase on Alliant and all of the Hodgdon brands. Around $2-3 per #. Literally while they hit us with an increase, Vista announced another, to take place April 1st...
     

    Brian's Surplus

    Expert
    Site Supporter
    Industry Partner
    Rating - 100%
    4   0   0
    Jul 18, 2016
    862
    93
    Howard County
    Powder prices are on average 25% more, primers 300% or more depending on where purchased, projectile prices are up 255 or more, ammo prices are up a lot, Inflation[ value of the dollar is down] and a corrupt administration in the whitehouse doesn't help either!!!!!!!!!!!!!!!!!!!
    It makes it difficult for retailers as well. Anything I have that has been on the shelf for more than a few months runs a risk of costing me more to replace than I sell it for. I just sold a tumbler a couple weeks ago for $74.77. I went to reorder it and it cost me $83.99 plus shipping. I had just bought it last year. Prices are going up in an amount greater than my markup in just a few months.
     

    tackdriver

    Sharpshooter
    Rating - 100%
    3   0   0
    Apr 20, 2010
    481
    93
    Interesting indeed. A few years back (well, quite a few) I studied the economic collapse in Argentina around 2000. One big problem was that retailers didn't catch on to what you just described. Normally - buy a can of beans for .35 and sell it for .70. With rapid inflation, shopkeepers thought "Hey, I'd better sell this for 1.00 to keep up with inflation, only to find out it was 1.20 when they tried to restock their shelves. Compound this across most products and decreased credit power, and they just couldn't restock. This further reduced supply to consumers, increased panic, and drove prices higher again. It was a pretty vicious cycle, leading to pretty vicious conditions on the street.

    The kicker was, the root causes were pretty simple to understand, and the trouble was predicted by many, years ahead of the collapse. The Gov't was just to entrenched in the games they were playing, and completely unwilling to take the actions needed to avoid the crisis. They just let the train go over the cliff because they didn't want to use the brakes.

    Sound familiar?
     

    BugI02

    Grandmaster
    Rating - 0%
    0   0   0
    Jul 4, 2013
    31,896
    149
    Columbus, OH
    It is definitely a profit driven drive by the ammo makers and the makers of components, primers from 3 cents to 10 plus cents, powders up to 35% increases, bullets and lead prices way up too, thinking component prices are high just to get people to purchase the ammo they make!!!!!!!!!
    You're on the right track, but think of it another way

    If they can sell the critical components for reloading for a total of, say, $120 ($35 for 1 lb of powder and $85 for 1000 primers) or they could use those components to make 1000 rounds of perhaps 9mm (5 or 6 grains per round and one primer) and they can sell those 1000 rounds for 40¢ per round then that is $400. Not sure what the relative profit margins are, but I'm betting it is higher on the ready to use ammunition

    It seems they can sell just about all of the ready to use that they can produce, so it would make sense that not much attention will be paid to components except as they reach a point where they have excess production capacity for primers and powder. I'm surprised that there is as much availability as we are seeing, and prices won't be under any pressure to get lower until the ready to use ammo pipeline is substantially recharged
     

    Brian's Surplus

    Expert
    Site Supporter
    Industry Partner
    Rating - 100%
    4   0   0
    Jul 18, 2016
    862
    93
    Howard County
    Interesting indeed. A few years back (well, quite a few) I studied the economic collapse in Argentina around 2000. One big problem was that retailers didn't catch on to what you just described. Normally - buy a can of beans for .35 and sell it for .70. With rapid inflation, shopkeepers thought "Hey, I'd better sell this for 1.00 to keep up with inflation, only to find out it was 1.20 when they tried to restock their shelves. Compound this across most products and decreased credit power, and they just couldn't restock. This further reduced supply to consumers, increased panic, and drove prices higher again. It was a pretty vicious cycle, leading to pretty vicious conditions on the street.

    The kicker was, the root causes were pretty simple to understand, and the trouble was predicted by many, years ahead of the collapse. The Gov't was just to entrenched in the games they were playing, and completely unwilling to take the actions needed to avoid the crisis. They just let the train go over the cliff because they didn't want to use the brakes.

    Sound familiar?
    I've been thinking about this a lot, especially now that we are spending a decent amount of time tracking and adjusting prices. We already have a plan if things get to the point of true hyper inflation. At that point it would be physically impossible to change prices fast enough. I would basically convert our pricing structure from US Dollars to store currency, something like "Brian's Bucks". We would have a dry erase board that could be changed as frequently as needed to show the current rate of exchange. It really scares me that I even had to come up with such an idea. I certainly hope I never have to implement it.
     

    Bill2905

    Master
    Site Supporter
    Rating - 100%
    4   0   0
    Feb 1, 2021
    1,945
    113
    Lake County
    If they can sell the critical components for reloading for a total of, say, $120 ($35 for 1 lb of powder and $85 for 1000 primers) or they could use those components to make 1000 rounds of perhaps 9mm (5 or 6 grains per round and one primer) and they can sell those 1000 rounds for 40¢ per round then that is $400. Not sure what the relative profit margins are, but I'm betting it is higher on the ready to use ammunition
    You are spot on. Ammo manufacturers are going to get paid for the value they add by assembling the components into ready to fire ammunition. I work in a completely different manufacturing industry but can relate that the same concept applies to our pricing and margins as well.
     

    BugI02

    Grandmaster
    Rating - 0%
    0   0   0
    Jul 4, 2013
    31,896
    149
    Columbus, OH
    I knew an engineer for Ford who told me once (a number of years ago) that it cost the company about the same to make a Taurus and a Navigator, about $18k

    He said they could sell the Tortoise for $21-24000 and they could sell the Navigator for $50k+, so which one did I think they would produce the most of
     

    Ark

    Grandmaster
    Site Supporter
    Rating - 100%
    25   0   0
    Feb 18, 2017
    6,735
    113
    Indy
    The article pretty much sums it up. Ammo is a cartel, all components come from the same two companies, there are massive barriers to entry, and they are currently reaming us and collecting the highest profits in the history of the business. They'll never let 2017 happen again. Who needs production when you have price hikes?
     

    guardman7

    Plinker
    Rating - 0%
    0   0   0
    Jul 19, 2011
    54
    18

    Suggestion is that inflation provides a cover for price increases that are actually going to profit. And we're paying the prices. Perhaps it's time to stop buying, and to let the inventory build up at the factories.
    Yeah but you’ve got a bunch of scabs and newbies who are still going to pay the prices. We need a few more manufacturers, less monopolies, and to bring those east bloc primers back
     

    Bugzilla

    Master
    Site Supporter
    Rating - 0%
    0   0   0
    Apr 14, 2021
    3,569
    113
    DeMotte
    Today on Ammoseek, 13 listings for 22 lr under 9 cents/round (My gauge for ammo pricing as it seems to lag others in price changes IMO) Still high, but prices do seem to be dropping. Haven’t seen that many under 9 cents in some time.
    Thought I read 5.4 million first time gun owners in 2021. If each one bought 100 rounds, that’s an additional 1/2 billion rounds being purchased.
     

    Brian's Surplus

    Expert
    Site Supporter
    Industry Partner
    Rating - 100%
    4   0   0
    Jul 18, 2016
    862
    93
    Howard County
    Today on Ammoseek, 13 listings for 22 lr under 9 cents/round (My gauge for ammo pricing as it seems to lag others in price changes IMO) Still high, but prices do seem to be dropping. Haven’t seen that many under 9 cents in some time.
    Thought I read 5.4 million first time gun owners in 2021. If each one bought 100 rounds, that’s an additional 1/2 billion rounds being purchased.
    We have had 500 round packs of .22lr at the store for less than $40 before tax, and they have been pretty much just sitting there (I think we only sold 1 last week). I think that's a good sign. Less than 8 cents a round and people aren't buying it as soon as it hits the shelves.
     
    Top Bottom