Europe faces shortage of gunpowder and TNT for ammo production – Bloomberg

European governments have used their ammunition stocks to arm Ukraine. This has exhausted the reserves of gunpowder, TNT, and other explosives, as well as rocket fuel on the continent. Since then, they have been trying to increase the production of artillery shells, rockets, and ammunition.

As Europe prepares for a significant increase in defense spending, a small number of manufacturers of these materials plan to ramp up their production capacities. Rheinmetall alone aims to increase gunpowder production by more than 50% by 2028, but even that will not be enough. CEO Armin Papperger said the company may need to almost double its production to more than 20,000 tons to meet demand.

Even before the inauguration of US President Donald Trump, European Union members set a goal to produce 2 million artillery shells by 2025, surpassing 1.4 million last year. In the spring of 2023, the European Commission launched the Act in Support of Ammunition Production (ASAP) program, allocating 500 million euros to expand the EU’s ammunition production capabilities.

Since then, the Trump administration temporarily suspended military aid to Ukraine, sowing doubts about the future of long-standing American security guarantees in Europe and signaling a willingness to negotiate with the Kremlin. The continent’s need for ammunition will only grow.

The European Union has proposed 150 billion euros in the form of loans to increase defense spending as part of its latest efforts to offset the weakening support from the US. The European Defense Industry Program will provide an additional 1.5 billion euros in EU funding to industry players from 2025 to 2027, but the European Parliament has yet to approve the European Commission’s decision.

Supply chains

However, the supply chain that explosives manufacturers rely on is complicated, global, and full of problem spots. Governments and manufacturers need to encourage the civilian chemical industry to shift to military production, simplify regulations to allow new factories to be built and dangerous cargo to be transported across the continent, and even ensure the supply of the most basic materials, which are currently sourced from China.

The supply of explosives faces a similar situation to that of rocket fuel. The EU plans to increase explosives production by more than 4,300 tons, which is estimated to be more than 30%, but it currently has only one large TNT production plant serving local production, operated by Nitro-Chem in Poland, with another one being built in Finland.

Manufacturers of alternative agents such as PETN, HMX, and RDX, which are used in plastic explosives, are overloaded. Norwegian manufacturer Chemring Nobel faced unprecedented demand after Russia invaded Ukraine, according to a company representative. The company states that its Norwegian business is operating at full capacity, and its order book is projected for several years.

Just as explosives and rocket fuel are bottlenecks for defense companies, gunpowder and TNT manufacturers are also having to consider limitations in their own supply chains.

Some European countries, such as Germany, the Netherlands, Belgium, and Poland, have well-developed chemical industries, but the precursors for explosives make up only a small portion of their capabilities. High energy costs and environmental regulations make chemical production abroad cheaper, and many companies now source precursors like nitric acid from China.

Most of the cotton used in nitrocellulose also has to be imported from China, which is the world’s largest producer and maintains friendly relations with Russia. While alternatives to cotton made from wood pulp and other materials exist, they are not yet produced on the scale required by the market.

Experts argue that long-term markets and funding will be crucial if supply chain issues are to be resolved. "The industry has been receiving significant orders in the past two years, but it is unclear whether this momentum will last," said Amos Dossi, head of defense policy research at ETH Zurich’s Center for Security Studies.

According to experts, reducing regulatory barriers, providing companies with guarantees, and overcoming social and fiscal barriers in Europe for investment in weapons and their components will be crucial to meeting the continent’s needs, especially since its largest strategic threat, Russia, has fewer such limitations.

"We have to rearm everywhere, simultaneously and in large numbers," said Peter from Brunswick. "An authoritarian state that has switched to a war economy at the expense of the population simply ramps up. And it must therefore be clear that we need to pick up the pace."

Remember, Russia produces nearly three times as many artillery shells as the US and Europe can supply to Kyiv.