Wednesday, March 21, 2012

Ammo rumors begin to run wild

If you listen to Don and Doug, you'd know retail inventories of .223 rifle ammo are running low. We spotted the trend more than a month ago and gave first warning. Since then, many ammo sellers have run dry, especially when it comes to .223 (or 5.56) loaded with 55 grain bullets.

As demand ramps up, it appears hysteria may be setting in. Take this claim at a website called Before It's News:
Subject: Government buying out all the 5.56 Military surplus ammo and is telling ammo dealers to stop selling to their vendors and civilians.

Source: US Army rifle marksmanship manual
Let's dissect the claim. First off, for ammo to be military surplus it either has to be government owned stock being sold by the government to the public, or it's a manufacturer's government contract overrun. In the case of an overrun, it seems logical the government would have first option on purchase or, at the very least, have insider knowledge that would let it buy any excess before it reached the secondary market.

Why would the government be repurchasing something it initially owned, or why would government have waited to buy in the after-market when it could have had first dibs? Something's going on in the marketplace, but it's too soon to jump to conclusions. What we're seeing now may simply be a case of consumer panic buying, or the result of speculators buying now for resale later.

I don't think anyone ever figured out what really caused the retail ammo shortages of 2009. Some say it was election related hoarding where people feared a new administration would cut off civilian supply, and that may have been part if it. Others suggested it was global demand from military contracts tying up production. That too, may have been part.

For whatever reason, inventory outages appear to be reemerging for the 2012 election cycle. .223 rifle rounds appear to be the first impacted. It remains to be seen whether shortages expand to include other calibers like they did three years ago.

If you want to do some shooting later this year, it might be a good idea to buy your ammo now. Ammunition has a long shelf life. If you enjoy shooting, it never hurts to keep your own personal inventory at least slightly ahead of anticipated demand. Especially in this age of spotty supply.

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