FARMER CITY, Ill. (AP) _ Carter Jones and Charles Bane are businessmen who know how to get the lead out: They turn half a million pounds a year into $1 million in bullets.

Bull-X Inc. produces the hard lead projectiles that competition shooters use to asemble their own rounds of ammunition.

And despite the recession, business has taken off. The company has grown to 20,000 customers from 3,000 when Jones and Bane bought it in 1988. Bullet production has increased from 25,000 a week to 100,000 a day.

''This is a classic success story in American small business,'' says Cameron Hopkins, editor of American Handgunner magazine. ''This is very much a growth market.''

American Sports Data Inc., of Hartsdale, N.Y., estimates that 18.2 million Americans practiced target shooting in 1990, including 3.8 million who shot 25 times or more.

American Handgunner caters to competitive shooters, who fire at old- fashioned paper bull's eyes or newer, more popular metal targets - some moving or shaped like animals. Many more people shoot informally at targets or soft drink cans.

Shooters buy bullets from Bull-X and put them in casings with explosive powder to create their own ammunition. This can cost as little as 5 cents a round, compared with about 30 cents for ready-to-shoot ammunition. Shooters also can adjust the volume of powder to match their gun and shooting situation.

Hopkins says interest in the sport increased after the first professional shooting teams were formed in 1986 and the media started covering competitions. ''Jones and Bane are known on the competition circuit,'' says Hopkins. ''People want to use the same equipment as winners - like a duffer buying the kind of golf clubs Arnold Palmer uses.''

Jones was working for a car rental agency and Bane was a pipeline contractor when they decided to buy Denny's Shooters Supply in Cedar Falls, Iowa, and combine a hobby with a business.

''We've been on a dead run ever since,'' Jones says.

Bull-X, which has 13 employees, buys a special lead alloy in Colorado and casts bullets in a variety of calibers. It ships to shooters all over the United States and in several foreign countries.

The lead-tin-antimony alloy creates a hard bullet, improving accuracy in target shooting.

The metal arrives in seven-pound ingots, is melted down in casting machines and takes the form of a bullet. A second machine squeezes it into the precise size and shape, and adds a lubricant that keeps gun barrels from getting coated with lead.

The noise and the 700-degree temperature of the casting machine make the work hot and hard, but Bane says Bull-X produces what customers want and ''our quality and service is always excellent.''

The men began in an old downtown building in this central Illinois community of 2,200, but the storage of 40,000 pounds of new lead alloy each month created a logistics problem.

Now Bull-X occupies an old lumberyard.

The company also buys spent shells from the military, cleans and reloads them, and sells them as practice rounds for police departments.

But ''we don't make cop-killer bullets or hunting bullets,'' Jones says. ''We are both (target) shooters, so we know this market.''