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A Message From Federal/CCI/Speer President Re: Ammo Demand


ltdmstr

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Sort of like gas prices. Refinery troubles in one part of the world and the price jumps .20 cents even though old fuel is still in the tank. Hedging for the next load. 
Kinda thinking on the primer supply is that factory’s can only have X amount of compound on site due to regulations. 

Edited by Farmer
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Or just shoot all rimfire and let the centerfire weapons sit idle except for special occasions.

 

A buddy I shoot with picked up two cases of CCI Mini-Mags last week for $400 a case (0.08 a round)....I offered to purchase one and he kindly said he preferred to not sell any because he said he would burn through those two cases in about a year because his daughter and he both shoot rimfire weapons in SCSA events....

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11 hours ago, Chillywig said:

One thing I would like to know is cost increases at the retail distributors. What are supposed reputable online ammo distributors have really jacked up the prices. Does the new cost of $0.60 a round for 9mm reflect the increase in costs the distributors are seeing or are they just gouging us customers?

I see three answers
simple yes
simple no
and why I think yep and that can go as good or bad
along with a "we won't really know," to add spice

 

it is pretty clear the prices of ammo were raised due to demand
and better understanding for why that happened this time
is to be found in the last round of shortages.  The opportunists
who saw the shortage rolling in and it was clear back then...
This time the prices were raised to discourage them or to get some clear profit
into the hands of the people in the normal supply line.
Yeah, prices went up with demand for profit sharing purposes.
so a simple yes

 

The "No" is one I have no evidence to explain.
prices of all items to make and supply ammo all went up
and thus ammo all went up.
it is possible.
so a simple no.

 

I think the main reason for the "I think yep"
is pretty much listed as above.
all year I have been hearing the excuse...
I have to raise prices because covid.
All it sounds like to me is... "theres a war on, ya know"
It MAY be true and it is not the complete truth.
I grant that SOME is caused by covid-19 and governments
doing various supply jacking and twisting things like customs or lockdowns.

Yet, that is fairly bogus in terms of prices for the ammo.
It does explain the temporary shortages earlier this year.

 

I don't like the shortage. Said to me clear.

If the manufacturers simply continue to ramp up prices until the demand wanes
they will make much profits and much consumer animosity.
I can control who gets my ammo spending coin...
and I may look more seriously into making a primer facility.
a bad reason to seek the joys of windfall...

 

on the other side, if they did roll the windfall into making
more infrastructure to make more ammo and components,
then I see it as a reasonable response to "supply and demand"
and once supply meets demand we can get ammo
that has a price related to cost to make

this will be higher than earlier this year because
the new facilities and machines must be paid and profitable.

 

I have no idea which of those thoughts are accurate.
I am confident expansion of manufacturing
is being planned in the face of the shortages.
I am sure future profits are motivation enough.

 

I don't know how the profits from the raised prices is getting split.

miranda

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8 hours ago, Chillywig said:

One thing I would like to know is cost increases at the retail distributors. What are supposed reputable online ammo distributors have really jacked up the prices. Does the new cost of $0.60 a round for 9mm reflect the increase in costs the distributors are seeing or are they just gouging us customers?

 

Part of the price increase is to prevent people from easily flipping what they buy. If stores sell at a much lower cost than the clearing price (what people will actually pay) then they are just enabling someone else to profit at their expense. Normally it isn't a problem but in times of allocated (rationed) shipments it means every store can only get so much product and thus they have to keep the lights on by selling whatever they get for as much as they can. Who knows when they will get more?

 

I'm not saying to forget those who gouge. Remember their names and act accordingly in the future. 

 

Prices will come down, but there will be a new higher price floor for everything. Inflation is the reason; the Treasury can't keep printing money without prices also rising. It sucks for those on a fixed income most of all, but most will suffer at least some diminution in standard of living.

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Hi Twinkie,

 

I agree with your post.

 

I am leery of the  word "inflation"

while I agree the treasury department printing paper will cause inflation...

inflation by itself is not the reason.

 

the leaders of our country (usa?) direct the treasury.

they are the reason.

 

miranda

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4 minutes ago, Miranda said:

Hi Twinkie,

 

I agree with your post.

 

I am leery of the  word "inflation"

while I agree the treasury department printing paper will cause inflation...

inflation by itself is not the reason.

 

the leaders of our country (usa?) direct the treasury.

they are the reason.

 

miranda

 

Well, I am trying to steer clear of politics on this forum, but I agree that people are responsible for policies. The Federal Reserve creates money so that Congress and agencies can spend it. In effect they are putting more money into the economy. More money especially money that had no basis in labor or in some store of value such as gold will tend to devalue existing money, causing inflation.

 

We will have to pay more for everything, and this process has been ongoing for at least my entire lifetime. It is covered up by imports and illegal labor both substituting for rising wages. Those are only moderately effective in ammo component production, so we will have to pay more as inputs to those industries rise in price.

 

I'm absolutely sure Federal, Hornady, Alliant, etc. will be raising prices permanently, but also that when things stabilize we will be back to rebates to encourage sales. Competition will keep prices at a lower level than currently but scarcity may return depending on external factors like we saw this year.

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Part of why I ask is LGS got a large order of ammo in before Thanksgiving. His cost on 9mm was basically the same as it always had been. So instead of selling the ammo for 30 a box like all the online guys are doing now he sold it for the normal 15 a box but limited it to two boxes per customer. He had 100k 9mm rounds go out the door in 1k transactions in about a week. I understand supply and demand but don't like the thought of gouging. I will never buy anything from cheaperthan**** ever again after the last gouging go around. We all want ammo and components and are pretty sure all the manufactures are running there guts out trying to get product out the door. But then the distributors are gouging us and making a fat ass profit were I would rather see that the manufactures getting more money to be able to hire more people buy more equipment etc. Either way its going to be a mess for a long time and all I can do is complain 

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On 12/19/2020 at 10:58 AM, SnipTheDog said:

Another thing that's leading to the shortage are the contracted shipments to US military, police, and NATO allies.


Almost all US .mil ammo comes from the Lake City plant.  Commercial plants like Federal and such don't have many .mil contracts.

 

On 12/19/2020 at 11:45 AM, Joe4d said:

just hopeing the primer supplies come back around before we end up with any more rules and restrictions.

Seems at 1 time primers were just primers, order them although guns stores used to have them at fair prices. Then they became Hazmat,,, BUT you could get 70lbs under 1 hazmat fee... Thats alot of primers. But seems I am seeing now there is a 20lb max.

 

 

 

Hazmat is 48 lbs.  I'm not sure where you're getting your info.

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On 12/19/2020 at 10:58 AM, SnipTheDog said:

Another thing that's leading to the shortage are the contracted shipments to US military, police, and NATO allies.


Almost all US .mil ammo comes from the Lake City plant.  Commercial plants like Federal and such don't have many .mil contracts.

 

On 12/19/2020 at 11:45 AM, Joe4d said:

just hopeing the primer supplies come back around before we end up with any more rules and restrictions.

Seems at 1 time primers were just primers, order them although guns stores used to have them at fair prices. Then they became Hazmat,,, BUT you could get 70lbs under 1 hazmat fee... Thats alot of primers. But seems I am seeing now there is a 20lb max.

 

 

 

Hazmat is 48 lbs.  I'm not sure where you're getting your info.

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  • 3 weeks later...
On 12/21/2020 at 10:19 PM, Twinkie said:

 

Well, I am trying to steer clear of politics on this forum, but I agree that people are responsible for policies. The Federal Reserve creates money so that Congress and agencies can spend it. In effect they are putting more money into the economy. More money especially money that had no basis in labor or in some store of value such as gold will tend to devalue existing money, causing inflation.

 

We will have to pay more for everything, and this process has been ongoing for at least my entire lifetime. It is covered up by imports and illegal labor both substituting for rising wages. Those are only moderately effective in ammo component production, so we will have to pay more as inputs to those industries rise in price.

 

I'm absolutely sure Federal, Hornady, Alliant, etc. will be raising prices permanently, but also that when things stabilize we will be back to rebates to encourage sales. Competition will keep prices at a lower level than currently but scarcity may return depending on external factors like we saw this year.

I think your analyses on the Federal Reserve is wrong.  They don’t create money.  The mints create money.  The reserve is used for monetary policy and the congress is fiscal policy. Two entirely different approaches to the economy. Bad info on your part. 

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Winchester put out a press release on 1/7 saying they are raising prices effective 2/1 due to increased manufacturing costs.

  • rimfire ammo +7%
  • hunting ammo +5%-10%
  • centerfire rifle FMJ ammo +10%-14%
  • centerfire pistol ammo +7%
  • components +10%
  • primers +10%-15%
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26 minutes ago, RangerTrace said:

They gotta pay for all the new machines, employees, etc. when the demand drops off.  No shocker really.  I will gladly pay an extra 10% for primers if I can buy them any time I want/need.

Yep. And it’s not like this is never going to happen again

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50 minutes ago, RangerTrace said:

They gotta pay for all the new machines, employees, etc. when the demand drops off.  No shocker really.  I will gladly pay an extra 10% for primers if I can buy them any time I want/need.

 

They could go to three shifts and just pay for the extra payroll costs.  Of course working a machine 24hrs/day would lead to increased maintenance costs, but little out of pocket when you can sell everything that you make.

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8 minutes ago, SnipTheDog said:

 

They could go to three shifts and just pay for the extra payroll costs.  Of course working a machine 24hrs/day would lead to increased maintenance costs, but little out of pocket when you can sell everything that you make.

I thought the video said they are running 24/7?

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7 minutes ago, Sarge said:

I thought the video said they are running 24/7?

The question was regarding buying new equipment or just staffing up.  I thought it would be cheaper to staff up rather than buy new equipment since if/when the demand wanes.

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they just staff up. buying more newer equipment that exceeds their regular production is a money losing proposition. i was still working at one of the major ammo makers through sandyhook, and there was no new anything that wasnt previously planned for.

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2 hours ago, SnipTheDog said:

The question was regarding buying new equipment or just staffing up.  I thought it would be cheaper to staff up rather than buy new equipment since if/when the demand wanes.

Agree. And seeing how this happens regularly I would just keep making a s#!t ton of everything since there will seemingly always be demand

Edited by Sarge
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