Ammunition

The weapons and ammunition market in Indonesia had average annual growth of 14% in the 2000-2011 period, with government support for the industry being one of the key growth drivers.

  • CAGR of the Indonesian market for weapons and ammunition during 2007 – 2012 was 9 percent.
  • PT. PINDAD (state-owned company) holds the biggest Indonesian market share for ammunition, mostly in small calibers.
  • Together with Rheinmetall, PINDAD build the Leopard ammunition plant for the Asian market.
  • PINDAD exports ammunition to America, Singapore, Thailand, Laos, and Nigeria.
  • The import market for weapons and ammunition in Indonesia is mainly supplied by France and the United Kingdom.

 

Total market size quadrupled over that time period and accounted for US$0.558 billion in 2011. According to data from EuroMonitor, CAGR (compound annual growth rate) of Indonesia’s weapons and ammunition market was 9 percent during 2007 – 2012. Along with growth in product prices, the market has experienced constant expansion since 2000, despite the global financial recession in 2009. Indonesian corporations remained the largest and most important buyer group. This condition will strengthening their importance from 75% of total market sales in 2000 to 84% in 2011. Household purchases increased in absolute numbers, yet their importance remained largely unchanged from 2000,  on average reaching 12% of total market sales during the review period.

 

PINDAD Company

The country’s ammunition market is dominated by Indonesia’s state-own defense company PT. PINDAD, one of the biggest ammunition manufacturers in Indonesia.  Its government-owned status makes it easier for them to penetrate markets such as police officers, army and other law enforcement sectors.

This situation makes the level of competition strong. Despite the fact that PINDAD´s product portfolio is quite limited and their production focuses mostly on small calibers.  Their competitors have the most opportunities in bigger calibers and in ammunition for imported weaponry, with which it is more common to use higher quality ammunition. Thanks to strong business relations between Indonesia and the United States, PT. Pindad also exported some ammunition to the U.S. in 2011. About one million rounds of ammunition worth US$ 200,000 to a sport shooting club. In addition, PINDAD continuously exports 5.56 mm ammunition to Thailand and Singapore. Year 2000, PINDAD also exported to Nigeria.

 

Indonesian Ammunition Import and Export

In the import market, France and United Kingdom are the main players in Indonesia. Those countries exported about US$23.988 million out of a total of US$41.885 million during 2013.  In January 2014, Indonesia imported bullets and ammunition worth US$56,800. Imports from Germany accounted for US$39,200 and Russia reached US$17,600. Weapons and ammunition that are usually imported include bombs, grenades, torpedoes, landmines and missiles. Other imported weapons and ammunitions are artillery weapons (guns, howitzers and mortars),revolvers and pistols, and rifle bullets. For Launchers are rocket launchers, flare launchers, and grenade launchers.

An initial cooperation agreement in 2012 for the procurement of 180 units of Leopard tanks and Marder, the Indonesian government successfully attracted Rheinmetall of Germany to help build a Leopard ammunition plant. According to Deputy Secretary of Defense Sjafrie Sjamsoeddin, this cooperation will develop a large-caliber ammunition (120 mm) plant in Indonesia. PINDAD will become the center of Leopard ammunition distribution in Asia. This cooperation will improve the technical quality of Indonesian domestic defense industry, helping Indonesia become a regional power in the defense industry market.

 

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