#Ammunition Market Forecast

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Global Ammunition Market Report

Given the limits on weapons in major economies, many ammunition items are not generally available commercially. However, defense organizations in large territories have opted to purchase these items in order to improve security capabilities. Military advancements by key economies such as China, India, France, and Russia are likely to promote market growth in the estimated time frame. Long-term collaborations and acquisitions between big corporations and governments characterize the global munitions sector. Several governments around the world, particularly India, are attempting to strengthen their defense capabilities by acquiring and expanding indigenous production facilities from foreign players.

Market Size and Trends in the Ammunition Industry:

The global ammunition market report led the market in 2023, accounting for around 88.08% of worldwide market value. Furthermore, this category is likely to maintain its dominance during the forecast period. Increasing cross-border conflicts have spurred the global expansion of the bullet market. Rising geopolitical tensions and terrorist actions are projected to boost product penetration. Full metal jacket bullets are widely employed in military handguns, although the Air Force prefers hollow-point bullets for increased precision. Because of their quick expansion and strong stopping power, hollow-point bullets are popular among law enforcement and military personnel.

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The Ammunition Market is expected to reach USD 9.11 billion in 2023 and grow at a CAGR of 4.09% to reach USD 11.13 billion by 2028. BAE Systems PLC, Rheinmetall AG, General Dynamics Corporation, Nexter Group, RUAG Group are the major companies.

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The naval ammunition market report covers current market size and 10 year naval ammunition market forecast It is segmented by type, technology, caliber, region

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We’re not out of the woods yet, though there’s good news in markets: Most economists are forecasting a soft landing in 2024. But a geopolitical hard landing could get in the way.

There are tools and processes to handle macroeconomic challenges. When inflation is too high, the Federal Reserve calibrates monetary policy and interest rates, often coordinating with peer institutions like the Bank of England and the European Central Bank. The results aren’t guaranteed or uniform—economists, investors, and policymakers debate policies and their consequences. However, if higher interest rates slow the economy and reduce inflation without causing a recession, we get a soft landing. That looks like the outcome we’ll ultimately achieve, with inflation down from its peak (though still above the 2 percent target), 353,000 new American jobs in January, and the International Monetary Fund revising its global growth forecast up to 3.1 percent.

The playbook in geopolitics is not as clear, and geopolitics has become a much more pessimistic field than the dismal science. There are wars in the Middle East and Europe, tensions in the Indo-Pacific, and deeper questions about what else the “end of the post-Cold War era” will bring. A geopolitical hard landing would entail multiple, connected, and expanding conflicts and crises that could overwhelm U.S.-led international system. The results could shift the balance of power and upend global markets.

What happens in geopolitics matters for global markets and for the way we live. Today’s geopolitical challenges aren’t transitory, they’re here to stay. They require timely interventions that consider realities of politics and resources, as well as factors like fear, honor, and interest, and the priorities and interests of sovereign nation-states. Too hawkish an approach can lead to overreach and blowback, while too much dovishness invites aggression and escalation. In fact, if the United States and its partners don’t get the trade-offs right in 2024, a geopolitical hard landing looks increasingly plausible.

Today, the world faces cascading conflicts of the type we haven’t seen in decades. After a chaotic withdrawal from Afghanistan in 2021, deterrence failed to prevent Russia’s full-scale invasion of Ukraine in 2022. In 2023, deterrence also failed to prevent Hamas’s terrorist attack on Israel and Iranian-backed regional proxy attacks across the Middle East. Could deterrence one day fail in the Indo-Pacific, the world’s most populous and dynamic region? Where will the cascades stop?

Across Eurasia, the picture is not improving. Two years into a full-scale war defending themselves against Russia, Ukrainians now control more than 80 percent of their territory. But the situation on the ground remains fragile and political gridlock in Washington could result in a reversal of those gains—just recently, the Ukrainian-held town of Avdiivka fell to Russian advances. The Senate just passed by a vote of 70-29 a $95 billion aid package to Ukraine, Israel, and Taiwan—much of which would be spent in the United States restocking depleted weapons supplies—but the bill’s fate is uncertain in the House, and the United States has done its last drawdowns for Kyiv under existing authorities. And while the 27 members of the European Union agreed to a $54 billion package, they don’t have a robust industrial base and can’t produce enough artillery shells to meet their pledge of 1 million rounds by March. Meanwhile, Ukraine is rationing ammunition, and after Russia’s presidential election later this year—no surprises expected there—Vladimir Putin might be emboldened to order a larger mobilization.

Markets have largely priced in the current Russia-Ukraine war. But they may not have accounted for its long-term significance or what the war could mean for Europe. With Russia probing Finland and Estonia, German Defense Minister Boris Pistorius gave a sobering speech detailing what that could mean, saying that Germany needs to take into account that Moscow could “even attack a NATO country” in the next five to eight years.

In the Middle East, the conflicts after Hamas’s terrorist attacks on Israel on Oct. 7 represent the region’s greatest geopolitical test since the Global War on Terror. Israel continues operations to destroy Hamas while Iranian-backed proxies are escalating across at least six different theaters. The global economy and the U.S. Navy—which has been protecting international commerce since the days of the Barbary pirates—are under fire from the Houthis in Yemen. A full-scale regional war is likely not in the cards, although any escalation that brings the United States and Iran into direct confrontation could quickly change that. It’s not hard to see how it could happen, and if Iran—dominated by an 85-year-old Grand Ayatollah Ali Khamenei, the region’s longest-ruling leader—were to succeed in building a nuclear weapon, it could accelerate the chaos.

What has Washington, Wall Street, and global political and financial capitals around the world most worried, though, is the Indo-Pacific. For geopolitical reasons, China is pushing a “dual circulation” economic model and greater self-reliance at home, combined with economic embargoes against not only the United States but also countries such as Australia, Japan, Lithuania, and South Korea. At the same time, most of the tariffs that began under the Trump administration have continued under President Joe Biden, and U.S.-led restrictions have reduced semiconductor exports to China by billions of dollars. The focus on national security-sensitive supply-chain chokepoints in everything from microelectronics, to pharmaceuticals, to critical minerals and rare earths is adding friction to the global economy in ways that create risks and opportunities in other theaters.

The worst-case scenario—a military confrontation between China and neighbors such as Taiwan or the Philippines, backed by the United States—could lead to untold human losses and the greatest economic shock in generations. Bloomberg Economics recently estimated a cost of $10 trillion in the event of a war with the People’s Republic of China over Taiwan.

Historically, shocks like the 1973 Arab oil embargo and Russia’s war on Ukraine have disrupted but not upended global commerce. Today’s dynamic could be different, with acute and connected challenges across all three major regions of Eurasia, not to mention crises not in the headlines every day, such as a belligerent North Korea and contentious Venezuela-Guyana border.

The world as we have known it has assumed the leadership of a credible great power: the United States. Working with its allies and partners, the United States has built and supported the international security and economic architecture that benefits not only Americans but populations around the world. Another assumption was that no other country would have the intention and the capacity to reshape this U.S.-led international order. With challenges to U.S. leadership and a growing closeness amongst China, Iran, Russia, and even North Korea, neither assumption can be taken for granted.

The assumptions may have changed, but as with economics, nothing is inevitable in geopolitics. Last year, some forecasters said there was a 100 percent chance of a recession in 2023. They were wrong. However, soft landings don’t happen on their own—they require leadership across domains.

The war in Europe isn’t what it was a year ago. Ukraine’s 2023 counteroffensive didn’t succeed. Kyiv’s on the defensive, unlikely to take back significant territory in 2024. Russia is pushing forward and now spends 6 percent of its GDP on its military, up from 2.7 percent in 2021, and bolstered by munitions from Iran and North Korea. Meanwhile, as former Google CEO Eric Schmidt warned, Moscow has “caught up in the innovation contest” with Kyiv, domestically producing drones like the Orlan-10 and the Lancet. And after pivoting to Asian markets, Moscow has mitigated Western sanctions, while the IMF recently upped its forecast for Russia’s economic growth to 2.6 percent.

Despite setbacks, several factors still favor Ukraine even if the prospects of victory seem elusive at best. Without a single American in the fight, and at a cost of 5 percent of annual U.S. defense spending, U.S. intelligence now estimates that Moscow has lost as much as 90 percent of its 2022 invasion force. Ukraine is winning the battle of the Black Sea, and the grain corridor out of Odessa was open to over 33 million tons of grain and foodstuffs in the first six months of last year, two-thirds of which went to the developing world. Ukraine is targeting Russian-controlled infrastructure, including around Crimea. Kyiv is also expanding its defense industrial base, launching a Defense Industries Forum with 252 companies from 30 countries.

While Europe has been slow to bolster its own defense infrastructure, there’s momentum. European defense spending was up 6 percent in 2022, led by front-line democracies like Finland, Lithuania, Sweden, and Poland. Still, most of the NATO alliance’s members fail to meet their 2014 Wales Pledge to spend 2 percent of their GDP on defense, and even U.S. defense spending as a percent of GDP is projected to decline over the next 10 years, from 3.1 percent in 2023 to 2.8 percent in 2033. Ukraine cannot hold back a country 28 times its size, and with a population more than three times larger, without Western assistance. Likewise, European—let alone global—security can’t be sustained by diminishing deterrence capabilities.

In the Middle East, the main questions being asked today are about the “day after” in Gaza, or when and how the Houthi attacks in the Red Sea and Iranian-back proxy attacks in Iraq will stop. Tehran has created a new normal of instability and chaos and has little incentive to see a ceasefire hold. The Houthis—once a relatively obscure Shi’a proxy group in Yemen—are now the heroes of much of the Arab street.

Iran’s strategic advantage in the short term has been enhanced by a radically changed information environment, where the “social-mediafication” of war means there are more hours of footage uploaded across all the popular social media platforms than there are seconds of the war. The ramifications are unpredictable—after all, many of the al Qaeda terrorists behind 9/11 were radicalized by pre-algorithmic content they saw coming out of war in Bosnia in the 1990s. Today’s AI-powered algorithms supercharge the risk.

The return to the bad old days, made worse by hyper-targeted online radicalization, needn’t happen, however. The Abraham Accords are holding. The Sunni Gulf countries are focused on transformation projects like Saudi Arabia’s Vision 2030, as they work to ensure that their economic progress is impacted as little as possible by geopolitics. Despite what’s happening in the Red Sea, their engagement with the international business community is largely uninterrupted. The same is true with Qatar.

The two factors that would bring the region back from the brink are restored deterrence against Iran and integration between Israel and the Gulf States. That means recognizing that Iran and its “axis of resistance” are the cause of today’s chaos. It requires working with partners like the UAE and Saudi Arabia, which has relaunched defense talks with Washington and whose senior officials have said repeatedly that they are “absolutely” still interested in normalization with Israel.

The South China Sea and Taiwan Strait are dangerous but, thankfully, at peace. There was good news out of San Francisco from the November meeting between Chinese President Xi Jinping and Biden. China’s responses to Taiwan’s election on Jan. 13 were more restrained than many expected. Now, much depends on how Beijing reacts to William Lai’s inaugural statements when he becomes Taiwan’s president in May.

But while Taiwan occupies our strategic focus today, it’s not the only potential hot spot. China borders 14 countries, giving it more land neighbors than any other state. Beijing has territorial disputes with nearly every country with which it shares a border; each of those disputes presents risks.

Still, maintaining an acceptable peace in the Indo-Pacific is possible. China’s more aggressive posture has driven significant changes in Australia, India, Japan, the Philippines, and South Korea, leading to minilateral coalitions for stability. The Quad, AUKUS, summits with South Korea and Japan, and basing agreements with the Philippines are a few such examples of how these countries are tightening cooperation with each other, and with the United States, Japan has committed to a sea change in defense policy that could turn the Japanese military into the world’s third largest by 2027.

In all this, however, there’s a missing link: Washington doesn’t yet have a strategy for economic engagement in the region. While agreements like the Beijing-backed Regional Comprehensive Economic Partnership expand, the Biden administration’s Indo-Pacific Economic Framework (IPEF) is stalled, and IPEF—which the White House has described as “not a trade agreement”—is not a replacement for the Trans-Pacific Partnership. Washington’s economic policy should communicate that it is not a distant power but a reliable economic partner. As the NATO alliance nears its 75th anniversary, leaders need to be committed both rhetorically and in practice to sustaining peace and prosperity wherever it is challenged.

These geoeconomic forces are of concern to publics around the world. They aren’t, however, the domain of the public sector alone. Many of the same market dynamics bringing us in for an economic soft landing can be assets in global affairs. Global companies cannot succeed in a world at war, and the United States and its allies and partners can’t keep the peace without the growth and innovation made possible by the private sector.

The two sectors where this dynamic is clearest are in energy and emerging technologies. Developing new and sustainable energy sources is one of the best geopolitical and economic moves possible, and it’s largely due to private sector-led innovations that the United States has been the world’s top crude oil producer since 2018 and top liquid natural gas exporter since last year. In the coming years, technologies such as generative artificial intelligence—where the United States is leading—will be wildcards and lifelines in geopolitics, and technology companies will become greater geopolitical stakeholders. Such domains are where democratic societies—with deep and open capital markets, the rule of law, and property rights—have advantages that are sources of legitimacy, stability, and growth.

Building on those advantages this year, when 60 percent of the world’s population is heading to the polls, is a necessity. Billions of people voting for their leaders is welcome news after years of democratic decline globally documented by organizations such as Freedom House. But the coming changes in governments around the world could also make the end of this year very different from its beginning.

In particular, the 2024 U.S. presidential contest may be the most consequential in decades, not to mention one of the most significant geopolitical issues for other countries. Foreign policy is rarely top of mind for voters, but the people’s choice may have even greater ramifications for global affairs than for the economy. Trade and industrial policies adopted by either administration may bolster some sectors at home but elicit pushback abroad, including from partners. New approaches to America’s role in the world can reassure friends or embolden adversaries. And every leader is preparing by hedging their bets for either a Biden or Trump outcome.

In 2023, we understood what an economic hard landing might mean and took timely, prudent actions to prevent it. In 2024, it’s time to recognize that a geopolitical hard landing is possible and for every sector of society to meet this moment with the seriousness it demands.

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Ammunition Market Growth Fueled by Global Defense Modernization

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Small Caliber Ammunition Market: Industry Insights, Demand Trends, and Market Projections

The global small caliber ammunition market size is expected to reach USD 11.30 billion by 2030, according to a new report by Grand View Research, Inc. It is expected to expand at a CAGR of - 0.7% from 2022 to 2030. This growth can be attributed to rising defense expenditure by countries across the world. In addition, a rise in hunting and sporting activities is expected to aid the industry growth.

The components for small caliber ammunition include cartridge casing, propellant, bullet lead, bullet penetrator, primer, and primer. The raw material suppliers provide customer-specific customized solutions. Furthermore, factors influencing value addition in this stage include price, availability of materials, cost position, quality, delivery timelines, and product innovation.

The small caliber ammunition industry is witnessing a huge rise in stockpiling trends owing to the emergence of warlike situations across the globe, driven by rising geopolitical tension and terrorist activities in several economies. The stockpiling strategy primarily offers significant cost savings as it can be purchased in high volume at cheap prices. This is, in turn, providing growth opportunities to the industry players.

Developments and enhancement of military capabilities in Morocco, Algeria, Tunisia, and other African countries are anticipated to increase the procurement of small to large-sized weapon systems, which is likely to increase the demand for suitable caliber ammunition. Moreover, a rise in political disputes in the Middle East, Africa, and Central and South America is expected to support the demand for small caliber ammunition in the estimated time.

The small caliber ammunition manufacturers can only sell their products to an entity with a federal license, which can be either retailer, wholesaler, or an individual user. Distribution through the B2C channel is very rare in this industry, however, it does exist. If an individual user wants to obtain the product directly from the manufacturer, they must provide their federal firearms license.

Small caliber ammunition manufacturers procure the components from raw material suppliers either directly or through third-party distributors under competitively priced supply contracts or bidding arrangements. The product manufacturers procure raw materials from the suppliers to further offer customized solutions to their clients. They also enter into long-term contracts with raw material suppliers to maintain a robust supply.

Major small caliber ammunition manufacturers across the globe including General Dynamics and Northrop Grumman are vertically integrated across the value chain and are partially involved in the supply of raw materials. Moreover, these companies have established a wide distribution channel in the Middle East, African, and Asian countries through joint ventures, mergers, and agreements.

Small Caliber Ammunition Market Report Highlights

The .50 BMG caliber segment is expected to witness significant growth over the forecast period owing to the increasing procurement of machine guns and sniper rifles. The .50 BMG cartridge has a soft steel-core bullet and is used for practice in the M2, M3, and M85 machine guns

The defense application segment accounted for the largest revenue share in 2021 and is expected to dominate the market over the forecast period owing to the increasing demand from prominent military across the globe. Continuous upgrading and standardization of the bullets and other ammunition used by the defense sector will also result in the growth of this segment

Asia Pacific is expected to witness considerable growth over the forecast period. The region has witnessed an unprecedented surge in defense spending over the past decade. Rising geopolitical tension and border disputes between the regional powers have been the primary driving factors boosting defense spending in the region

The industry demand was hampered owing to the global outbreak of the COVID-19 pandemic in 2020. The subsequent economic impact of COVID-19 has curtailed the defense spending by the countries in 2020, thereby affecting the small caliber ammunitions demand

The market is characterized by acquisitions and joint ventures between major players and the government to establish long-term contracts. It is slowly moving towards consolidation due to increasing acquisitions in the market. Major players in the ammunition market exhibit an extensive product portfolio and are focused on product innovation in order to increase their market share and maintain their market position

Small Caliber Ammunition Market Segmentation

Grand View Research has segmented the global small caliber ammunition market on the basis of caliber, application, and region:

Small Caliber Ammunition Caliber Outlook (Volume, Million Units; Revenue, USD Million, 2017 - 2030)

56 mm

62 mm

9 m

.50 BMG

Others

Small Caliber Ammunition Application Outlook (Volume, Million Units; Revenue, USD Million, 2017 - 2030)

Civil & Commercial (Sporting, Hunting, Self-defense, and Others)

Defense (Military, Law Enforcement)

Small Caliber Ammunition Regional Outlook (Volume, Million Units; Revenue, USD Million, 2017 - 2030)

North America

US

Canada

Mexico

Europe

Germany

UK

France

Russia

Turkey

Asia Pacific

China

India

Australia

Indonesia

Singapore

Central & South America

Brazil

Middle East & Africa

Egypt

Israel

List of Key Players of Small Caliber Ammunition Market

Northrop Grumman Corporation

FN Herstal

Hornady Manufacturing Company, Inc.

General Dynamics Corporation

Nosler, Inc.

Rheinmetall Defense

Remington Arms Company LLC

Vista Outdoor Operations LLC

Sierra Bullets

Australian Munitions

Nammo AS

Poongsan Corporation

ST Engineering

DSG Technology AS

Winchester Ammunition, Inc.

Order a free sample PDF of the Small Caliber Ammunition Market Intelligence Study, published by Grand View Research.