Ammo and Reloading Components - World Market - Whats Driving The Price Up ?

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msg.drew

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Even if you have not been shooting long I am sure you have noticed the price of ammo and components steadly increaseing... I have been looking at prices and searching for deals as I will be placeing more orders not that does any good because nearly everything is backordered... if you look around at Cabelas, Midwayusa, and other big box stores majority of there items are backorder and the prices are getting a bit out of control.

Over the last 6 to 12 months I have seen an increase in price of almost 70% well our dollar was at par then so realistically there has been about a 50% increase.

You walk into any gun shop and they will tell you that its because of the dollar but several years ago the dollar was even worse but reloading supplies cost much less then they do today...

Yes there is a supply issue right now Americans are in a panic over what Obama will do to there precious guns... thats the main reason why everything is backordered right now.

The second typical gun store comment is you know there is a war on right now...:D Correct me if I am wrong but I dont see uncle sam using Hornady Sierra or for that matter any other bullet brand... they have there own contracts and mfgs...

After racking my brain for a while I came up with this... your a giant plant like Hornady... you can't make anymore projectiles or ammo so what do you do??? to fix the supply and demand issue you increase prices... you make the items cost more so less people can aford them and then your supply and demand issue is no longer a problem... in the end you dont have to spend a dollar more or make a bigger plant, invest in machines, workforce etc... and the great part is they make tones more money...eventually they will make things so expensive that they have a surplus and then they might have a sale but realistically its not a sale.

I am sure there are people that are selling their guns and getting out of the sport or downsizing there colletions or not going out to the range as much as they used too... the only effect I can see is this will have a negitive effect in the long run and is just another nail in the coffin for our shooting sports here in Canada.

So what do you think?
 
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They charge what they do because they can. My preferred 12g loads has gone up 300% since I started buying my own ammo 4 years ago. Reminds of of that "cheap" x51 surplus that came in. What a joke, my ####### is starting to hurt :rolleyes:
 
Apparently we are at the start of an economic slide. I believe this. From what I am hearing in the UK which is possibly a little further down the slope, is that,
in attempt to make any profits prices are being reduced. This makes sense to me. Make what you can when you can. However no one is spending. Whether out of fear or lack of funds I don't know.
Yet here in North America at least in this example we are seeing the opposite. The prices of guns and gun paraphernalia are sky rocketing. And we are being given reasons for it but they don't make sense, to me at least.

Are we seeing equivalent price climbs on other goods?
 
Its a business like any other with a profit maximization objective. Unfortunately people dont run a business or go to work for others to have a low cost hobby.

Barriers to entry (regulation, politics...) reduce competition (limit supply) and allow for greater profits. How many new ammunition manufacturers have gone into business the last 5, 10, 20 years...

Note the oil companies - consider the price of oil per barrel, price of gas per litre (adjust for the 2 month lag if you like, trend interesting nonetheless), limited number of manufacturers, barriers to entry, no new refineries for years, limited ability to substitute other products... we're still at double the price for the same cost per barrel... and Exxon still the most profitable company in the world (are a number of oil companies in the top 10)...

Emotional ties that bind a person to the activity reduce the likelihood of substitution (must own guns, must be able to shoot, its my 2nd amendment right / have to be able to defend self, you get the idea).

The indicators suggest business is good - not seem to be any issues with inventory turnover (quite the opposite, often have to wait weeks/months for firearm / accessory of choice) or pressures to reduce pricing like a number of other goods these days...

If you want a cheap hobby, look for something with one time costs, not per use costs: windsurfing, cycling, photography... good - skiing, golfing, shooting... bad. Consider laser printer (below cost, recover on ink), game consoles (below cost, recover on games), bicycles (bike low margin, accessories / tires high margins), firearms... ammo... Just a question of cost, volume, profits... markup / quantity / capacity... business will find a way to make money, is why they are in business.

Shop around, buy from business that give you the best price, you get low prices, they get profits through volume. Yesterday at the range someone wanted a Shadow - local dealer that generally matches prices (except for PST-shipping differential) is out, referred them to h t t p://www.gunsnthings.com good service, SP01 Shadow for $839 including GST, $30 for shipping... Am buying a adjustable sight for a Beretta for under $60, there are "reasonable" prices out there, find them, support them.
 
warrenb said:
Apparently we are at the start of an economic slide. I believe this. From what I am hearing in the UK which is possibly a little further down the slope, is that,
in attempt to make any profits prices are being reduced. This makes sense to me. Make what you can when you can. However no one is spending. Whether out of fear or lack of funds I don't know.
Yet here in North America at least in this example we are seeing the opposite. The prices of guns and gun paraphernalia are sky rocketing. And we are being given reasons for it but they don't make sense, to me at least.

Are we seeing equivalent price climbs on other goods?
Click to expand...

americans are still stock piling firearms because of Obama getting into office.
funny thing is i don't think that the price of firearms or components is going up in the USA just canada. has very little to do with the dollar.
 
American pricing

crout said:
americans are still stock piling firearms because of Obama getting into office.
funny thing is i don't think that the price of firearms or components is going up in the USA just canada. has very little to do with the dollar.
Click to expand...


There have been lots of price increases in the USA. Check out the threads on rimfire central, the days of the 10- 12 dollars for bricks of 22 ammo are well over. Even 17HMR which used to be much cheaper in the US have gone up a lot.

I bought a bunch of brass last year from Sinclair's and it is all much more expensive this year. Plus we can't even get the stuff shipped up here anymore. FS
 
crout said:
americans are still stock piling firearms because of Obama getting into office.
funny thing is i don't think that the price of firearms or components is going up in the USA just canada. has very little to do with the dollar.
Click to expand...

The price has increased in the USA as well... pending you can find what your looking for...
 
The biggest problem for reloading components is commodity or metal pricing.

Last year, the pricing for ALL metals shot up, as did the price of oil.

All that costs are cemented into the contract pricing which manf have been receiving over the last 4 months. That massive increase in delivered raw material costs is finallying making it into the end use product which are all trying to buy.

The fact that commodities/metals and oil have plummeted doesn't change the costs that manf booked at.

Now that there is massive demand, these higher prices are being absorbed by the consumer. Lucky for the manf or they would be stuck with massively expensive inventory. Sort of like condos in Toronto....

In time, this panic buying will ebb, the raw material pricing will come down as new stock is bought at todays numbers. As supply grows, pricing 'should' come down.

Or at least, not get much worse.

And for those that think pricing is simply a Cdn problem/gouging, consider that I had new Hornady stock enter my dist inventory at 40% more then it was priced a few months ago.

The stock was completely gone in less then 12 hours. US buyers. Just think what the net Cdn price would have been with a 1.25 exchange...

Jerry
 
mysticplayer said:
The biggest problem for reloading components is commodity or metal pricing.

Last year, the pricing for ALL metals shot up, as did the price of oil.

All that costs are cemented into the contract pricing which manf have been receiving over the last 4 months. That massive increase in delivered raw material costs is finallying making it into the end use product which are all trying to buy.

The fact that commodities/metals and oil have plummeted doesn't change the costs that manf booked at.

Now that there is massive demand, these higher prices are being absorbed by the consumer. Lucky for the manf or they would be stuck with massively expensive inventory. Sort of like condos in Toronto....

In time, this panic buying will ebb, the raw material pricing will come down as new stock is bought at todays numbers. As supply grows, pricing 'should' come down.

Or at least, not get much worse.

And for those that think pricing is simply a Cdn problem/gouging, consider that I had new Hornady stock enter my dist inventory at 40% more then it was priced a few months ago.

The stock was completely gone in less then 12 hours. US buyers. Just think what the net Cdn price would have been with a 1.25 exchange...

Jerry
Click to expand...

There you have it, the ammo/components were built with the most expensive raw materials the world has ever seen. Next year they will be lower.
 
The raw materials have been on the decline for some time... The bullets I am getting in from hornady a freshly made normally the same week they are shipped


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One thing about business is once an item is priced high it will hardly ever go back down... once your willing to pay that price you normally dont lower the price even if the cost of materials goes down...
 
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msg.drew said:
One thing about business is once an item is priced high it will hardly ever go back down... once your willing to pay that price you normally dont lower the price even if the cost of materials goes down...
Click to expand...

Also, the manufacturer's sales volumes have probably also gone down, limiting how much they can reduce their prices and still make enough total profit to stay in business.
 
Not true at all.

Look at the price of gas. Kind of dropped off a wee bit over the last 4 months.

I bet the time cycle for metal to reach a manf can be as long as 6 months. If coming from overseas, transit is 1 month ONCE it hits the ocean. Forget about all the time to make the alloy, ship the alloy, stage at the docks, load, ship, unload, customs, transit, and off loading.

Domestic supply may still be several months so we are chasing the tail on commodity pricing. Especially when it is bouncing around at a rate never seen before.

Same like what happened last year when our dollar was at US$ par. Consumers screamed that their pricing had not gone down fast enough. For the retailer, they had to eat the currency spread for stock that was purchased several months earlier at unfavorable exchanges.

Well, I had the pleasure of opening my 'store' and see the fastest DROP in Cdn currency ever recorded. How about a 25% drop in less then 30days? Try working that into your costs...

Consumers are always quick to jump on getting prices down but very resistant to rising costs. That makes sense.

All those in the supply chain have to balance profits with market forces. Sometimes, that simply cannot react fast enough.

Jerry
 
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