Why is commercial steel-cased .223 more expensive than 7.62x39?

[tomandjerry00]

I keep looking at ammo prices and I get confused why steel-cased .223 is more expensive than 7.62x39.

I can reload .223 cheaper than I can reload 7.62. 7.62 uses more components in every way. More steel in the case, more lead/steel in the bullet, more powder (most loads) and a larger primer. All of this screams higher expense to me.

My guess is the sheer volume of military contracts suppliers have in Eastern Europe is what drives down the price? Am I missing something?

 

[Half-cocked]

My guess is, economics of scale. 7.62x39 is AK/SKS fodder, used the world over, and has always been produced in mass quantities in steel cased. 5.56 on the other hand was traditionally made in brass, and only recently in steel cased, by fewer mfr's, for a much smaller market than 7.62x39.

 

[smdub]

1) Volume (manufacturing)
2) Price elasticity

 

[JoeBobOutfitters.com]

1) Volume (manufacturing)
2) Price elasticity

Yup

 

[Flametamer]

I've found that product pricing on commodity-like items often has little to do with the cost of production. It's more about what the market will bear, i.e., what we are willing to pay.

 

[tomandjerry00]

I've found that product pricing on commodity-like items often has little to do with the cost of production. It's more about what the market will bear, i.e., what we are willing to pay.

I agree completely.

So lets venture into another realm. Anyone want to guess how much it costs Wolf to make every round of .223 and every round of 7.62x39?

 

[Mark75H]

I agree completely.

So lets venture into another realm. Anyone want to guess how much it costs Wolf to make every round of .223 and every round of 7.62x39?

Factoring in all bribes they have to pay or just the freight conductors and longshoremen?

 

[MEGARMS]

I've found that product pricing on commodity-like items often has little to do with the cost of production. It's more about what the market will bear, i.e., what we are willing to pay.

And we have a winner. Ammo is really no different than gold, gas, and corn.

 

[bkuether]

Probably was taught this at some time in my life... For the record, here is a good explanation of Price Elasticity (of demand).

http://economics.about.com/cs/micfrohelp/a/priceelasticity.htm

 

[Shemp]

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