US Gun Demand Drops To Four-Year Low

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by Tyler Durden
Thursday, Jul 06, 2023 - 12:00 AM

US gun purchases soared during the virus pandemic after the government forcibly locked down the economy. Demand for firearms surged again following the outbreak of civil unrest nationwide. However, the demand for firearms has sunk to a four-year low, indicating the possible end of this boom. Yet, it's only a matter of time before gun-buying surges again, given the potential unrest in American cities, as law-abiding citizens carefully watch the turmoil in France.

According to data from the FBI's National Instant Criminal Background Check System (NICS), unadjusted criminal background checks fell 11% to 2.26 million in June, the lowest since September 2019. Background checks decreased by 12% from 2.57 million compared to a year earlier. NICS checks were down 51% from 4.69 million (a record high) in March 2021. 

Recall NICS background check data is a proxy for gun sales because no national database tracks firearms purchases. The data continues to confirm slumping demand. We noted this trend earlier this year in a piece titled "Gun Background-Checks Reveal Firearms Demand Slumped After COVID Mania."

Sliding gun demand has left Smith & Wesson Brands, one of the country's largest firearms manufacturers, with elevated firearm inventory at retailers and distributors. Chief Executive Mark Smith noted in the latest earnings release that consumer promotions are helping to reduce inventory woes. 

NICS data appears to lead shares of Smith & Wesson Brands. 

Data from Ammo Prices Now shows the most popular caliber for home defense (9mm) has plunged from its Covid peak of 71 cents per round to 14 cents. 

Gun and ammo deflation might suggest now is a good time to take advantage of sales or lower prices versus a few years ago before demand surges again.