It seems that when oil prices used to rise, it raised the cost of everything else because oil (and gasoline) are needed to mine the materials, manufacture the materials into things, and then transport the things to market. So how about ammo, which keeps rising in price? Mining of copper and lead should be cheaper now, along with getting it to stores. So should we be seeing a big price reduction soon if the price of oil keeps dropping?
Could oil prices lower ammo prices?
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frankenstein406
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I think we will see more sales to keep people buying it. The main problem I see is even tho scrap prices plummeted the price of raw clean metal is high because of them being able to move it around and artificially inflate prices.
Thermactor
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Copper just hit a 5-year low. Copper is a good bellwether for industrial demand for, among other things, commodities. Copper is also a key component in ammunition manufacture. Lead prices have also come down recently. I think those factors mean more than most in terms of what kind of prices we will have going forward.
JTHunter
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With the way copper prices are falling, "brass" should be coming down as well.
http://www.nasdaq.com/markets/copper.aspx
http://www.nasdaq.com/markets/copper.aspx
WestKentucky
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COULD certaintly. Anything is possible.
SHOULD absolutely. Lower fuel means cheaper freight which should be savings passed on to the end user.
WILL probably not. Fluctuations in freight typically act like the one-way valve on a waterline. Costs go up, people pay more for the product. Costs go down, "remember last week they paid more, they probably still will, more in our pockets"
SHOULD absolutely. Lower fuel means cheaper freight which should be savings passed on to the end user.
WILL probably not. Fluctuations in freight typically act like the one-way valve on a waterline. Costs go up, people pay more for the product. Costs go down, "remember last week they paid more, they probably still will, more in our pockets"
cat_IT_guy
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Im with WestK. Some costs involved in manufacture and transport of ammo will decrease and save someone money. As the end customer, unfortunately, I doubt I see those lower costs reflected in the price of ammo.
IT's already been reported that companies are making no plan to reduce prices just because one item of expense has dropped. They are taking the profits as fast as they can.
There is also the risk of dropping prices at the MSRP level, which involves jumping thru a ton of legal hoops with regulations, just to see prices jump back up again.
But, mostly, it's the corporate strategy to boost profits to the shareholders, and they get their incentive program maxed out in the process - soaking the consumer. Only competition from the smaller companies attempting to garner a larger share of the market will have any affect.
There is also the risk of dropping prices at the MSRP level, which involves jumping thru a ton of legal hoops with regulations, just to see prices jump back up again.
But, mostly, it's the corporate strategy to boost profits to the shareholders, and they get their incentive program maxed out in the process - soaking the consumer. Only competition from the smaller companies attempting to garner a larger share of the market will have any affect.
Unless of course a large manufacturer is, or soon finds themselves in, a position to lower prices thus increasing sales vs their competitors thus increasing profits.
I'm sure it's not as simple as "charge a lot" when it comes to maximizing profits.
Thermactor
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And thats where a price fixing cartel comes into play.
That's some pretty fancy coordination, what with major manufacturers being located on different continents and all that.
What is it like to have the whole world plotting against you?
Thermactor
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The foreign makers face barriers to entry that US manufacturers don't have, and higher transportation costs.
That must be why foreign ammo is never competitive in the marketplace and nobody ever buys it.
MagnumDweeb
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Doubt it. Don't get too excited about oil prices remaining low. If you need a current example, look at milk prices. Milk prices are going to fall from overproduction and unlike the ammo industry, the milk industry invested heavily in updated and new equipment as well as additional facilities and are now going to be suffering for a good long while because of their over reliance on the Chinese consumer market (because they never thought the Chinese would start making their own milk powder when the industry started to boom in 2001).
Oil will maintain it's pricing more or less and in about six months will start to go up, if not sooner. We can't maintain shale fracking at oil's current pricing and once fracking starts to back off so will supply and thus we'll see prices go up again. Plus OPEC will eventually reduce production which will cause a dramatic increase in oil, even though Russia and Venezuela are desperate to keep selling their only really valuable resource.
The number crunchers across the board know this and aren't going to adjust pricing preemptively in the interest of losing money. They'll do everything they can to maximize profits ahead of consumer satisfaction.
Oil will maintain it's pricing more or less and in about six months will start to go up, if not sooner. We can't maintain shale fracking at oil's current pricing and once fracking starts to back off so will supply and thus we'll see prices go up again. Plus OPEC will eventually reduce production which will cause a dramatic increase in oil, even though Russia and Venezuela are desperate to keep selling their only really valuable resource.
The number crunchers across the board know this and aren't going to adjust pricing preemptively in the interest of losing money. They'll do everything they can to maximize profits ahead of consumer satisfaction.
Stargazer65
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I hope so. I expect to see a brick of 500 .22lr going for about 2-3 dollars by next week.
Sunray
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The only thing related to oil prices that moves quickly is the price of gas going up. Everything else will take months to trickle through.
Maybe you haven't noticed, but the price of gas went down very quickly recently.
Thermactor
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Exchange rate fluctuations play a factor in the attractiveness of foreign ammo to some extent in their pricing.
Thermactor
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Retail gas prices are 'sticky to the upside' and decline much more slowly than the value of the underlying asset.
The price of spot gasoline tracks the fluctuations of oil price a lot better. There's a lot of slack in retail gas pricing and that's pure profiteering and racketeering.
TimSr
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It takes a very long term, sustained reduction in fuel costs before it begis to affect other products. The lead time between manufacturing to on the shelf can be months or even years. Transporters are not going to reduce thier prices until they are convinced the price will stay there for a while. For shippers like UPS and Fedex, it costs a lot of money just to change and implement new pricing tables. Then you have the greed in government where they are already talking fuel tax hikes rather than let consumers enjoy a cost of living break while it last. Yes, fuel prices over long term can bring down the cost of everything provided they are not offset by taxes and other increased expenses. The way fuel goes up and down, its going to have to be far longer before anybody makes business decisions based on it.
Current/recent at-the-pump gas prices recently dropped rather quickly.
And this is why they are in on the global-scale price fixing scheme?
Thermactor
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owned.
Pardon?
Last 6 months, down $1.50/gallon
Last 1 month, down $0.30/gallon
I'm sorry that the gas market in Cincy is apparently really strange and went up 20 cents literally overnight while the rest of the country continued to fall, but...how is that supposed to "own" anything??
Or is your point that gas dropping 30 cents in a month does not qualify as dropping quickly?
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