Sticking to its Guns: Global Uncertainty Drives up Investments in Arms and Ammunition Manufacturing

Researched by Industrial Info Resources (Sugar Land, Texas)--With applications in various sectors such as defense, security and commercial/personal sales, the firearms and ammunition industry is witnessing a surge in demand globally.

Influenced by the growing cross-border conflicts and increasing terrorism threats, the demand for ammunition is increasing, especially in the defense sector. Apart from the military sector, the civilian demand for guns and accessories is further bolstering investments for various applications such as hunting, sports shooting and personal security.

Industrial Info is tracking 58 active projects globally, worth US$2.72 billion, directed toward the manufacturing of various types of ammunition and firearms. Subscribers to Industrial Info's Global Market Intelligence (GMI) Industrial Manufacturing Project Database can click here for the project reports.

North America dominates the global ammunition market with investment worth US$1.77 billion, followed by Europe with US$633 million and Oceania with US$165 million.

The U.S., Poland and Hungary are the top countries that are driving considerable investments in the ammunition market. The U.S. is one of the biggest spending drivers, with a share of 65%, followed by Poland and Hungary with investments worth US$293 million and US$195 million, respectively.

The U.S. Department of Defense (DOD), Polska Grupa Zbrojeniowa SA (Radom, Poland) and Rheinmetall AG (Düsseldorf, Germany) are the top major entities that are investing in the manufacturing of ammunition.

One of the largest projects is being undertaken by the DOD, which is planning to invest US$994 million to expand an existing ammunition manufacturing complex in Iowa to increase the production of 155-millimeter high-explosive projectiles by between 12,000 and 20,000 per month. GMI subscribers can read the related project report and click here for the plant profile.

About 72% of the total spending is in the planning stage, while 16% has progressed toward engineering and the remaining 11% is under construction.

While the demand is growing, the ammunition industry is facing several supply-related issues. Due to the ongoing geopolitical tensions, a large amount of ammunition is being diverted toward military use. For instance, the Ukraine conflict and NATO's active involvement have put a strain on ammunition production leading to a supply shortage for civilian use.

Vista Outdoor (NYSE:VSTO) (Anoka, Minnesota), one of the major players in the ammunition industry, has donated ammunition to help the war-torn nation of Ukraine. Similarly, NATO has also committed to a $2.5 billion contract for procuring ammunition supplies for its member states. As a result, the shifting focus of ammunition production toward the military sector, along with the heightened demand, has led to increased prices and limited availability of ammunition.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).