The large caliber ammunition market is expected to register a CAGR of more than 4% during the forecast period (2020 - 2025).

  • Governments across the world are making investments in weapons such as field artillery, mortars, naval guns, etc. to strengthen the land and maritime border security, civilian protection, and lethality of armed forces. These weapons also act as a cost-effective option over costly missiles and rockets used for ground attack operations. Owing to the aforementioned reason, the demand for large caliber ammunition is expected to rise during the forecast period.
  • Significant technological advancements such as high-speed projectile firing, laser guidance systems, and the increasing need for friend or foe identification technology and precision targeting technology is driving the market growth for GPS enabled artillery and mortar shells. Due to an increase in political instability and terrorism in Middle-East, overseas deployment of forces have increased and simulataneously increased the demand of fire power support on battlefield which is driving the market growth for large caliber ammunition.

Key Market Trends

Rise in Defense Spending is Supporting the Growth of the Large Caliber Ammunition Market

Territorial disputes that increased in the Middle-East after the reduction in forces from Western countries has resulted in armed conflicts between national armies of various countries. Countries in the Middle-East have increased the procurement of artillery systems and mortars over the past decade which has simultaneously generated demand for large caliber ammunition. Many countries across the globe such as the United States, India, and China have increased there defense spending significantly since 2010. India increased its military spending from USD 66.25 billion in 2018 to USD 71.13 billion in 2019. A large part of this defense spending goes to the procurement and development of weapons and ammunition. Many countries are spending a significant amount of money on artillery shells, mortar ammunition etc. For instance, in 2019, Pakistan entered into a deal with Italy for the procurement of 100,000 artillery shells. In 2019, the United States Navy also inked a USD 22.7 million deal with BAE Systems for Bofors 57MK3 Gun System for its Littoral Combat Ships. Technological advancement such as precision-guided technology, etc. is another factor that is driving the market growth. In an effort to further strengthen its border defense, India confirmed the order of buying precision guided Excalibur 155 mm artillery rounds from the United States in 2019.

North America Registered the Highest Market Share in 2019

In defense, the United States has the biggest budget in the world with the Department Of Defense receiving nearly USD 720 billion in 2020. The United States is investing heavily in modernizing its navy and in 2019 United States Navy tested High-Velocity Projectile which is a Mach 3 shell capable of carrying three times more explosive than the existing ship ammunition shells fired from guns on frigates and destroyers. The projectile can be fired from both 127 mm and 155 mm guns. In 2020, the United States Marine Corps invested USD 10 million for the development of polymer cased large-caliber ammunition that will reduce the total ammunition load carried by combat units, thereby increasing battle efficiency and decreasing combat fatigue. In May 2020, the United States Army signed a deal of USD 7.9 million with Raytheon Technologies for the development of ramjet-powered long artillery shells in collaboration with the Netherlands Organization For Applied Scientific Research. Such development and procurement plans will drive the growth of the large caliber market in the US during the forecast period.

Competitive Landscape

The market for large caliber ammunition is fragmented with several players. Some of the prominent players in the market are General Dynamics, BAE Systems, Orbital ATK (Northrop Grumman), Rheinmetall AG, and Nammo AS among others. The market is driven by innovations in design, materials, lethality, etc. The increasing need for arms and ammunition is allowing the countries to strengthen their local and government-owned ammunition companies. Countries, like Saudi Arabia, the United Arab Emirates, China, and India, are supporting local manufacturing companies to facilitate the need for their respective armed forces, thereby, helping the local companies to have a significant share in the market studied.

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