Together with David Mayne, we sorted out this strange ammo issue.
It was used in a piece of equipment called a Rypa, possibly of Canadian design, to train gunners in tank warfare.
Rypa is a device which simulates the Roll, yaw, pitch and alternating oscillation of a tank in action (Hence the acronym). The trainee gunner in a revolving turret looks through a telescopic sight, and shoots lead pellets at moving targets with an electric operated air rifle.
Needs more research to see how the Navy were using them, but the same principles would apply on a pitching boat deck I imagine.
I can see why they sent pellets to testing at Footscray, as the accuracy of those tested was terrible. Variations in weight seems to be the main reason, even from those supplied by I.C.I.