Each year, the ATF publishes reports detailing firearms trends and statistics, providing valuable information to FFLs, government agencies and industry stakeholders. This data is then compiled in a comprehensive document titled the “Report on Firearms Commerce in the U.S.”
While most reports publish figures from the previous year, data submitted for the Annual Firearms Manufacturing and Exportation Report (AFMER) is withheld from immediate disclosure, protecting filers under the Trade Secrets Act. As such, the new “2021 Report on Firearms Commerce in the U.S.” includes the latest numbers from 2019 and 2020, depending on source.
Containing more than two dozen pages of charts and graphs, below are key takeaways from the latest firearms commerce report.
Firearm Production Declining
While the 2020 Interim AFMER proves otherwise, the 7 million firearms manufactured in 2019 were the lowest total since 2011 (6.5 million) and 23% fewer than that produced in 2018, with all firearm types down year-over-year. Shotguns, specifically, were at an all-time low (480,735), down 60% since their most recent peak in 2013.
Of course, 2020 was a historic year in the firearms industry with total production topping 10.6 million firearms, and similar numbers are expected for 2021.
Exports Down, Imports Up
Of firearms manufactured in 2019, just 317,482 were exported out of the U.S. – the lowest total since 2012. Imports were also slightly down in 2019 but surged in 2020 to a record high (6.8 million) as domestic manufacturers struggled to feed the appetite of gun owners. Handguns made up 60% of all imported firearms, but rifle imports achieved the greatest year-over-year growth (159%).
Continued NFA Growth
As the number of manufactured and imported NFA firearms continues to grow, so too does the interest of gun owners in NFA items. In 2020, more than 884,000 ATF Form 2 applications were processed – up 5% from 2019 and 44% from 2017 – as well as a combined 287,596 Form 1 and Form 4 filings. Both Form 1 and Form 4 applications were up 31% year-over-year as more suppressor manufacturers entered the market and potential pistol arm brace regulations resurfaced.
Also noteworthy, FFLs paid nearly $8 million in special occupation taxes (SOTs) in 2020 – an increase of 68% over the last decade.
Licensees Hold Steady
Since 2012, active FFLs have held steady between 130,000 and 140,000 licensees, though numbers have been declining since 2014. In 2020, licenses totaled 130,605 by year’s end with no significant year-over-year change for any FFL type and Texas, Florida and Pennsylvania still atop the list of FFLs per state.
New FFL applications also remained stable in 2020 at 13,429.
Compliance Inspections Impacted
In a year of social distancing and shutdowns, it should come as no surprise FFL compliance inspections were down in 2020. In 2019, ATF inspections reached a near-record high of 13,079, or 10% of active licensees, above the 10,000/7.3% average of the prior five years (2014-2018). However, only 5,827 FFLs (4.3%) were inspected in 2020 – the lowest percentage since 2004. But rather seen as the “new normal,” last year’s numbers should be viewed as an outlier.
This summer, the Biden administration announced new strategies to prevent gun crime, including calling on Congress to increase ATF resources to hire additional personnel and step up dealer inspections. Shortly after, both houses responded with proposed legislation. A leaked ATF internal memo also revealed the agency’s intent to place a greater emphasis on compliance inspections moving forward.
Only a summary of trends within the new “2021 Report of Firearms Commerce in the U.S.,” we encourage all to review the document in greater detail for even more figures and findings.
A one-stop shop for FFL compliance services, contact Orchid today to learn how to get your FFL and SOT, help navigating import and export licensing, and to schedule a mock ATF inspection with our in-house regulatory experts.