Ammunition Market Size, Share, Growth Analysis, & Forecast

Opportunity: Stockpiling of ammunition

Despite the risk of unplanned explosions and theft associated with the stockpiling of ammunition, there is a rise in stockpiling by both the military as well as civilian sectors. Countries across the world are procuring and stocking large quantities of ammunition to maintain sufficient war reserves. This stock of surplus ammunition has increased in several countries as a result of a reduction in the size of their armed forces. These countries have accumulated large stocks of ammunition and are continuously procuring more ammunition to ensure war preparedness.

The US Department of Defense stocks war-fighting materials in NATO countries as well as with non-NATO allies. Apart from military applications, federal law enforcement agencies in the US, such as the Department of Homeland Security, the Federal Bureau of Investigation, and the US Secret Service, also stockpile ammunition.

Ammunition is largely unregulated in the US, and there are no federal restrictions on how much one can buy at once. According to the National Shooting Sports Foundation (NSSF), at least 12 billion rounds of ammunition are manufactured annually in the US. After its purchase, there is no way to track its usage. As a result, the Vice President of Gun Violence Prevention at the Center for American Progress has expressed concern about the danger that can come with the bulk purchasing and stockpiling of ammunition. In the civilian market, panic-buying and fluctuations in the availability of ammunition, as well as volatile pricing, are the major reasons for the stockpiling of ammunition. Stockpiling of ammunition is expected to act as one of the major opportunities for the growth of the global ammunition market.

Challenge: International measures to control use of ammunition

The Arms Trade Treaty (ATT) is a multilateral treaty ratified by 91 countries across the globe that came into effect on December 24, 2014. It is one of the measures taken by the United Nations Security Council to regulate the international trade of small arms, ammunition, and other weapons. The treaty prohibits the sale of ammunition across international borders.

The Arms Trade Treaty requires all state parties to adopt basic regulations and approval processes for the flow of weapons across international borders and establish common international standards that must be met before arms exports are authorized. It also requires annual reporting of imports and exports to a treaty secretariat. These regulations impact the contracting and procurement processes related to ammunition in various countries across the globe and further impact the export of ammunition across borders. In 2019, the US announced the withdrawal of its support for the Arms Trade Treaty regulating the multibillion-dollar global arms trade, which could affect the market significantly.

Additionally, unsecured or poorly managed ammunition stockpiles contribute to insecurity, with diverted ammunition becoming a catalyst for armed conflict, organized crime, and terrorism. The improper handling of ammunition has led to unplanned explosions at munition sites in over 100 countries, causing humanitarian and socio-economic disasters.

In 2020 and 2021, a Group of Governmental Experts (GGE) adopted a comprehensive approach to address safety and security measures for ammunition throughout its lifecycle. The GGE proposed practical recommendations for a comprehensive framework on conventional ammunition management to prevent both unplanned explosions and diversion.