The outside of the can is pristine. It has however been kept in a cool basement inside a sealed ammo can. I find it hard to believe (or at the least very disappointed) the powder has broken down so quickly under ideal conditions. If this were kept in a polyethylene container (as all are these days), it would still be bad, but without any indication.
This must mean the loaded ammunition is all those brass cases have spoiled as well. What the heck?! We've always been told ammunition last a REALLY long time. A couple of months ago, I shot 22LR from the 60's. All went bang and grouped as well as fresh stuff at 100 yards.
I understand, you are experiencing denial at this particular moment. Who wants to toss out gunpowder they have kept nicely stored for the last two decades? No one!
Now if we could afford a half million dollar gas chromatograph, such as this one made by the Dutch Company TNO,
https://www.tno.nl/downloads/DV2_05d012_Stability_of_gunpropellants.pdf
You could test the amount of stabilizer left in the gunpowder and follow these criteria:
Ammunition Surveillance Procedures SB 742-1
https://acc.dau.mil/adl/en-US/238111/file/68728/SB 742-1 AIN47-13A.pdf
Chapter 13 Propellant and Propelling Charges ,
page 13-1
WARNING
Nitrocellulose-based propellant can become thermally unstable as the age. The normal aging process of the propellants involves deterioration of the nitrocellulose with an accompanying generation of heat. At some point, the propellant may reach a state where heat is generated faster than it can be dissipated. The accumulation of heat can lead to combustion (autoignition). Chemical stabilizers are added to propellants to slow the aging process. In time, the stabilizer levels will drop to a point where the remaining effective stabilizer (RES) is not sufficient to prevent an accelerating rate of decomposition. When this point is reached, the propellant may autoigniet, with possible catastrophic results to property and life. Monitoring the stability level of each propellant lot is essential for continued safe storage.
Page 13-5 , Table 13.2 Propellant Stability Codes.
Stability Category A 0.30 or more Percent Effective Stabilizer
Acceptable stabilizer loss: safe for continued storage
Stability Category C 0.29-0.20 Percent Effective Stabilizer
Significant stabilizer loss. Lot does not represent an immediate hazard, but is approaching a potentially hazardous stability condition. Loss of stabilizer does adversely affect function in an uploaded configuration. Disposition instructions will be furnished by NAR. All stability category “C” assests on the installation must be reported in writing…
One year after becoming stability category “C” a sample of the bulk propellant lot or the bulk-packed component lot will be retested. If the lot has not deteriorated to category “D”, it will be retested each year until it has been expended, or it has deteriorated to category “D”, at which point it will be demilitarized within 60 days.
Stability Category D Less than 0.20 Percent Effective Stabilizer
Unacceptable stabilizer loss. Lots identified as stability category “D” present a potential safety hazard and are unsafe for continued storage as bulk, bulk-packed components , or as separate loading propellant chargers. Bulk propellant, bulk –packed components and separate loading propelling charges will be demilitarized within 60 days after notification of category “D” status.
Gunpowder is a complex mix, all of it made under different conditions, and gunpowder varies considerably in shelf life. A rule of thumb is 20 years for double base and 45 years for single based powders, assuming no exposure to heat. This rule will be wrong more than it will be right. This Dutch brochure touches on the heat aspect
https://www.tno.nl/downloads/Lifetime prediction of ammunitions.pdf
But because Gunpowder has an unpredictable lifetime, first World Militaries educate experts to test their stockpiles to determine if the nitrocellulose propellants are still safe to store. Army 89 Bravo’s take classes, get certifications,
http://www.armywriter.com/NCOER/89B.htm
This is a symposium presentation showing what one company was doing to prove that their product could meet lifetime expectations. The sort of guys who go to these symposiums are Insensitive Munitions experts.
http://www.imemg.org/res/IMEMTS 2006_Shachar_paper_post.pdf
This is all informational and of no use to you for your powder issue. Your tin of powder has given you direct evidence of powder breakdown. That red dust could be rust, could be powder. Rust accelerates the breakdown of gunpowder as do all ionic chemicals. Water is a polar molecule and the ionized oxygen end breaks down gunpowder. When gunpowder reaches the end of its life, a couple of dangerous phenomena happen: The first is pressure spikes. Old gunpowder does not burn evenly, just look at that dust for example, there is so much surface area the burn rate is going to spike on ignition. Just look at coal dust explosion videos if you don’t think organic dust will explode. The older the powder gets the more likely you will encounter pressure problems, some of which might blow your gun into pieces. The next problem is auto ignition. Old gunpowder gets hot, and it self ignites. The greater the bulk of gunpowder, the worse the chance of auto ignition. No one should ever pour their 8 pounds jugs of powder into 5 gallon buckets and store them in the attic. That is a house fire waiting to happen.
Last week I finally poured out 16 pounds of surplus IMR 4895 I purchased in 2005. The stuff smelled sweet but year old loaded ammunition would crack every case neck after firing. The stuff was outgassing nitric acid gas, below any levels I could smell, but I did not trust the stuff and out it went.
So, to recap, old gunpowder is a risk. You could load the stuff and go out and test. I have shot old gunpowder that had some dust, things were not bad, in fact, it shot well. But now, I would pour the stuff out as I know what I am dealing with. My tolerance for risk has really dropped in my dotage as I have used up most of my nine lives; not sure how many I have left.