Thursday, January 27, 2022

MKS Supply, Industry Day at the Range, Barnaul Ammo Import (Russain Ammo Ban)

MKS range position with Barnaul Ammunition Shot Show 2022

At the Industry day at the Range, Shot Show 2022, this correspondent was able to talk with Charles Brown, President of MKS Supply. Their position on the fireing line was on the West end of the range positions. 

There was a several cases of Barnaul ammunition on display. As Russian ammunition has been sanctioned by the Biden administration, Mr. Brown was asked about the effect on his ability to supply ammunition to the American market. 

The company is required to submit Form 6's to import ammuntion. The forms are submitted long in advance. There is a significant pipeline of ammuntion continually being imported into the United States. 

The Biden administration sanctions on the importation of Russian ammuntion did not revoke any of the Form 6 applications which had already been approved. They became effective on September 7, 2021. They will continue in effect for 12 months, to be re-evaluated in late August or early September, 2022, which will be shortly before the mid-term elections in November of 2022.

The sanctions stopped approval of the Form 6 applications which were not approved when the Biden sanctions were put in place.

Approved Form 6 applications can be used for two years from the date of approval. Thus, from the date of the Biden administration sanctions, imports will continue for about two years. 

Charles Brown said the sanctions applied both to assembled ammunition and to components. He said a major effect on the company was to stop progress on a series of new calibers the company has been working on to market in the United States. 

He said because of the way the sanctions are worded, components cannot be simply shipped to a country outside of Russia, and then imported from that country instead of from Russia. 

What happens is a severe break in the supply chain. No more Form 6 applications are approved. The major effect of the break in Form 6 approvals will not be seen by consumers for about a year and a half, as orders continue to be filled from imports approved on Form 6 applications before the sanctions were put in place. 

Because the United States is the major private market for ammunition, suppliers cannot easily shift market share between producers. 

The market in ammunition is not as fluid as in oil, or coal, or rice or wheat. There are many major markets for those commodities. When China banned Australian exports of coal and wine, Australian producers were able to shift to other markets because of world wide demand. Eventually, China realized they were hurting themselves more than Australia. 

If there were major market for ammunition outside of the United States, another market would buy the Russian ammunition, and the USA market would be able to purchase ammunition from other countries which would normally go to that market.

There isn't enough of a market in the rest of the world for legal, private ammunition outside of the United States. The United States is home to about half of all private firearms on the planet, as estimated as of 2017. The US private stock has increased about 12-14% since then. Almost all of the United States private arms are owned legally, allowing significant ease of ammunition use for training, target shooting, hunting, and informal recreation. 

According to the Small Arms Survey, most of the rest of the ownership of private arms in the rest of the world is illegal, severely reducing the opportunity for legal use and supply of Ammunition.

As an informed guess, the United States Market probably consumes over 80% of the legal commercial ammunition in the world.

Expect Russian ammunition supplies to dry up. But not just yet. More supplies will continue to come on the market for almost two years. 

©2022 by Dean Weingarten: Permission to share is granted when this notice and link are included.

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