The global small caliber ammunition market size was valued at USD 5.59 billion in 2022. It is projected to reach USD 9.36 billion by 2031, growing at a CAGR of 5.90% during the forecast period (2023-2031).
Bullets and cartridges of a relatively small calibre are collectively called "small calibre ammunition" and can be fired or dispersed using a firearm. Primers and gunpowder are included for a successful explosion. These shells are the containers for the fuses and booster charges used in various rifles, shotguns, and artillery pieces. Different metals and metal alloys, including brass and steel, are used to manufacture such ammunition. Forces at the national, state, and local levels and those tasked with maintaining order at the country's borders are increasing their demand for ammunition, driving the market. The shifting defense priorities of countries due to political upheaval and heightened terrorism threats significantly impact the global weapons production industry.
Market participants' expansion is based on their capacity to adapt to shifting consumer preferences and foresight to foresee how the market will change over time. Independent fighting groups' functions on contemporary battlefields are constantly evolving. The high frequency of encounters with opposing weapon emplacements in various artificial and natural shelters, which cannot be conquered purely with inferior firepower, is reflected in data from recent combat actions. As numerous organized and unorganized competitors are in the market, triangulating the inventory of small-caliber ammunition worldwide takes a lot of work.
The need for subsequent armament upgrades and customization has arisen from the changing nature of the battlefield environment. Innovative thinkers have poured a lot of money into creating complex weapon systems because they need precise, light, and small weapons. Defense agencies of several nations have been encouraged to strengthen their countermeasure capabilities against various threats due to the rise in terrorism and other insurgent activities on a global scale. The number of troops deployed across the borders of their respective allies and nations like the United States, Russia, China, and India has been rising. For instance, as part of its peacekeeping efforts in Syria, Russia retains about 5,000 personnel. To ensure their safety, weapons have been quickly acquired due to the increased troop deployment.
Additionally, in order to combat terrorism in Jammu and Kashmir and the current terror proxies along the Line of Control with Pakistan, the Indian Army introduced the newly acquired Sig Sauer assault rifles in 2019. As of October 2020, the Indian Army had made significant progress toward implementing its long-delayed roadmap to equip its 380 infantry units with new assault rifles, close-quarter battle (CQB) carbines, and light machine guns (LMGs). The anticipated procurement plan calls for purchasing over 57 thousand LMGs, 460 thousand CQB carbines, and about 950 thousand assault rifles.
Any program of modernization needs investment. To halt the trend toward obsolescence and ensure superiority over the present and potential adversaries, more investment in the R&D of light weapons is essential. Modernizing obsolete technologies and weapons requires significant financial input. To maintain lengthy lead-time improvement programs, the Army must simultaneously create cutting-edge technologies to enhance mobility, lethality, and protection. Due to the slower growth rate of commodity exporters in Latin America, the Middle East and Africa, global economic growth has slowed over the past few years.
Market growth in the United States, China, Japan, and European nations has remained modest due to increased policy uncertainty and sluggish investments following the Brexit decision in the United Kingdom and a new administration in the United States. The recent COVID-19 pandemic has caused powerful nations to reevaluate their objectives and direct most of their financial resources toward upgrading and strengthening their medical infrastructure. As a result, a short-term decrease in the military budget is projected.
The structure of international security systems has been compromised by growing hegemonism, unilateralism, and power politics that have fueled multiple global crises due to significant changes in the international strategic environment. One of the main factors upsetting the geopolitical environment is the ambiguity surrounding many nations' territorial claims, such as the Cold War between Saudi Arabia and Iran in the Middle East. Governments' most frequent response is to spend more on the military to enhance security in their respective nations. Modernizing outmoded military hardware is necessary since battlefield conditions are constantly evolving. The capabilities of military rifles from the 1980s, which are still widely used by armed services, are inferior to those of modern weapons.
Military superpowers, including China, India, the United States, and the United Kingdom, have enhanced their military might and defensive capabilities. Several weapon procurement programs are currently underway to effectively upgrade the powers of the regional armed forces for responding to security threats and completing urgent, crucial, and risky strategic missions. This is done to ensure the combat readiness of the existing defense systems.
The global small caliber ammunition market is segmented by use.
Based on use, the small global caliber ammunition market is bifurcated into civilian and military.
The military segment is the highest contributor to the market and is estimated to grow at a CAGR of 5.40% during the forecast period. The expansion of defense budgets has made it possible to invest more money in military modernization initiatives that seek to replace or enhance the current arsenal of weapons with stronger ones. In nations like Germany, France, India, China, and Russia, which are investing heavily in modernizing their ground forces by introducing small guns, the effect of military modernization on the ammunition market is evident. For instance, the delivery of HK416 A5 assault rifles was the subject of a contract granted to German military manufacturer Heckler and Koch by the Norwegian Defence Materiel Agency in January 2019.
Before the lockdown began, citizens from several nations began buying small-caliber ammo in bulk. Additionally, given the current situation's numerous riots and civil upheaval, individuals are expected to buy ammo for their firearms out of a need for personal defense. Due to the simplicity of getting a firearms license in these nations, most civilian users of small-caliber ammunition are found in North America and Europe. Another critical factor for expanding the market in these regions is the acceptance of hunting and shooting sports in the regions' nations.
The small global caliber ammunition market is bifurcated into four regions: North America, Europe, Asia-Pacific, and LAMEA.
North America is the primary significant revenue contributor and is expected to grow at a CAGR of 4.60% during the forecast period. The American military is present in more than 150 nations worldwide, with some members of the armed forces stationed there on a long-term basis (apart from Afghanistan, Iraq, and Syria). In addition to participating in active combat, US personnel frequently serve as military attachés, embassy and consulate security staff, or as part of several other classified operations. Such deployments have substantially contributed to the increase in the US armed services' acquisition of weapons and ammunition. The U.S. military employs a variety of infantry weapons that are intended to eliminate fortified buildings and vehicles as well as enemy positions, clear up space for friendly troops to maneuver, and attack distant objectives.
Asia-Pacific is expected to grow at a CAGR of 6.40% during the forecast period. The QBZ-191, the assault rifle that will shortly replace the QBZ-95 bullpup-style rifle released in 1997, is being tested by the Chinese military. The new rifle uses a new type of ammunition that performs better at medium to long ranges and is chambered in the regular 5.8x42mm caliber. New Gatling-style machine guns that China has also developed are anticipated to provide motorboats, helicopters, and light military vehicles with more firepower. One type can fire 6,000 bullets per minute and has six 7.62mm caliber barrels. China recently completed creating a more potent kind. The upgrade, which has three barrels of 12.7mm caliber, has a higher round-per-minute rate of 2,000 and a larger cartridge with a capacity of 400 bullets, making it more potent than typical large-caliber machine guns.
The United Kingdom is a significant contributor. Around 192,000 active military soldiers and 83,000 reserve military personnel comprise the United Kingdom's approximately 275,000 overall military strength. The defense of the United Kingdom, its overseas territories, and the Crown dependencies is the responsibility of these forces. Additionally, they aid in global humanitarian operations and support international peacekeeping missions. The majority of the country's armed services' needs for small-caliber ammunition are met by BAE Systems. The business recently created new 5.56mm and 7.62mm rounds for the UK military that significantly increased range and armor penetration while still adhering to the standards of NATO. Additionally, the business produces lead-free, lighter-weight bullets for the armed forces.
Many South American nations are experiencing an economic crisis due to the COVID-19 pandemic, while others are exacerbating their existing weaknesses. During the forecast period, this will probably lead to a decline in military spending in the rest of Latin America. Military expenditure in Chile, Argentina, and Colombia fell in 2019 compared to 2018. Until mid-2020, Chile had 77,000 active military soldiers, Argentina had roughly 83,500, and Colombia had 295,000. The nation's current geopolitical situation necessitates the government giving ammunition purchases top priority, and this trend is anticipated to last throughout the forecast period. Threats from Saudi Arabia's unstable neighbors include Iran across the Persian Gulf, Yemen to the south, and Iraq to the north.
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