This is a complex issue.
1st no one is manufacturing gun barrels using the traditional forge welded methods. There are a very few in Europe who know how to do it, but they only do "1 of" to show their skills. There are some American gunsmiths who only make muzzle loaders, but they do not produce the patterns of old.
If some one could do it using the old methods, they would face liability issues. In Europe all their work would have to be proof tested. In the USA they would be required to have a Federal license to manufacture firearms and they would still have to face liability issues. Traditional forge welded damascus was capable of passing nitro proof. The issue is some handloader who double charges a load!
There is some low volume production using Damasteel. Damasteel is NOT damascus. It uses a powdered solidification method to produce damascus like patterns.
http://www.damasteel.com/http://www.ssdamascus.com/ There currently are 2 firms that use damasteel for firearms production. Flodman produces shotguns. They have used damasteel to make barrels. Caspian produces 1911 based pistols. They have used damasteel to make 1911 slides. A third firm was going to use it for rifle barrels, but went bankrupt before they could.
http://www.flodman.com/http://www.caspianarms.com/ Pete
