The increase in demand is coming from all the people who do not regularly buy ammo. I have no proof of this, but it is my theory.
There are ~300 million firearms in the US. What percentage of those are fired on a regular basis, at least twice per year? 5% ? 10% ? I would guess it is something like 10% are used at least twice per year. So there are 30 million firearms which are used regularly, and which consume all of the ammo which is produced for private (consumer) sale. The ammo industry is sized so that it can meet the governmental needs, plus the consumer needs of 30 million regularly used guns.
So now a "crisis" happens, and people start to think " gee I ought to get me some bullets for my gun". Now you have 270 million guns which have been sitting for years, unused, with a half-empty box of cartridges next to them... and suddenly their owners decide they need to stock up on a box or two of shells. Of course the ammo industry can't keep up with this spike in demand.
It would be as if an ailen race eliminated all cars from the planet, and now everyone needed a new car this year... this very month in fact. There is no way the auto industry could replace the worlds population of cars in a year, or two years, or even three... That is somewhat the situation with ammo.