The sound of birdsong in the dense pine forests of central Norway might be postcard-perfect, but first of all. Several thunderous explosions soon shattered the idyllic countryside, and two white vans were hit by various shells and caught fire.

“Isn’t it a wonderful sight?” An official of the Norwegian munitions company Nammo used a clearing in the woods to display its products.

Military and Ministry of Defense officials from 33 countries traveled into the Norwegian countryside to see the latest shells for everything from tanks and machine guns to F-35 fighter jets.

Nammo’s testing campaign underscores the surge in ammunition demand since Russia’s full-scale invasion of Ukraine 18 months ago, not only from Kiev but also from Western countries eager to replenish their stocks after donating so much.

But it also points to a poignant problem: the challenge of ramping up production to meet Ukrainian and NATO demands after decades of relatively little investment. Defense industry insiders say Ukraine can fire more artillery in one month during the heat of war than all European manufacturers can produce in an entire year.

“We are in an industrial war for capacity,” says Nammo CEO Morten Brandtzæg.

sharpshooter rifle firing
Defense industry insiders say European companies produce between 350,000 and 650,000 rounds of artillery a year © Nammo

Nammo and other munitions makers (which in Europe include Germany’s Rheinmetall, Britain’s BAE Systems and France’s Nexter) face a range of questions, including how much it would cost to dramatically increase production, who should pay and how fast it can go.

Nammo faced another, more idiosyncratic challenge this year, with Brandtzæg blaming the storage of TikTok cat videos for delaying plans to expand its main factory in Raufoss, 100 kilometers north of Oslo, where its testing center is located.

The company found it didn’t have enough power to support its expansion as surplus energy in the area was taken up by a data center being built for the Chinese social media group.

Brandtzæg said government officials had indicated that Nammo’s power problems would be resolved soon. But he added that it raised a big topic not just for Norway but for Europe as a whole. “How do you prioritize the distribution of energy between different companies? You need certain criteria: how many jobs are created? How important is it to society? How important is it to total defense?”

The biggest debate in the forest is how to close the huge gap between capacity and demand. According to defense industry insiders, the total annual production of artillery by European companies is between 350,000 and 650,000 rounds.

Ukrainian Defense Minister Oleksiy Reznikov told the EU in March that the country consumes an average of 110,000 rounds of artillery shells a month, estimated to be a quarter of what Russia uses.

At the time, Kiev already wanted to use more shells, and Reznikov put Ukraine’s minimum requirement at 356,000 shells per month and said a fully operational artillery system would consume nearly 600,000 shells. The recent counter attack has only increased the pressure.

“There is a huge gap between capacity and demand. In a worst-case scenario, Ukraine consumes the entire annual output of European industry in one month. European countries are also trying to replenish their stocks,” said a defense industry executive.

Nammo’s Brandtzæg cites different figures – he says Ukraine uses about 2.4 million rounds per year, or 200,000 rounds per month. He estimates that for Nammo alone, it would take an investment of $3.5 billion to get there, or more than 50 years at the company’s usual rate of investment.

The issue has captured the attention of politicians at the highest levels in Europe and NATO. Industry leaders have repeatedly briefed Western military alliances on progress. The European Union has pledged to use 2 billion euros to buy 1 million rounds of ammunition for Ukraine next year.

But much of that comes from existing stocks donated by European countries, which are also now working to replenish supplies.

At Nammo’s test event, procurement officials from the US, UK and various European countries watched the demonstrations, exchanging gossip and concerns for days as the air was filled with gunpowder.

CV90 tank with 12.7 mm machine gun
The biggest debate right now is how to close the gap between ammunition capabilities and needs © Nammo

Among them, Brigadier General Thomas Baker, head of Norway’s land systems department, said the Russian incursion had caused a change of mind among Western governments, but not fast enough.

“The first 20 years we could live off of Cold War stockpiles. Now we’re running out of gear. Now we’re donating the last stockpile we have. In the meantime, we have to build again. Switching from slow cycle to Fast cycling is an exercise. It involves more risk,” he added.

It is the latter that businesses worry about. For Nammo, which is owned by the Norwegian government and Finland’s state holding company, the big investment could take 15 to 20 years to break even, Brandtzæg said, and most contracts in the industry are annual contracts.

“Will the demand last this long?” he asked. “What keeps me up at night is…”. . How long will politicians’ support last? “

He recounted the recent “near bankruptcy” of an unnamed ammunition company when the company’s national government canceled an order for medium-caliber ammunition because it suddenly wanted larger-caliber shells.

Brandtzæg said Nammo typically invests around 7 million euros a year, but by 2022 its spending has exceeded 100 million euros. “We’re taking big risks. But we’re not going to take all the risks.” He suggested the government would need to do more if Namo and others were to invest any money needed to meet current needs.

Another industry executive was blunt in warning that, despite the EU’s proposed funding, there was still too little concrete help.

“At this rate, it could take decades to produce what is needed for a year. If the government wants more ammunition, they need to act. If we have to do it ourselves, we will go bankrupt,” said the report. an executive added.

Rheinmetall, Germany’s largest defense contractor, said this year that it would only be able to build a new factory for gunpowder, a key ingredient in munitions, if it received subsidies. “We cannot invest in everything alone because it is an investment in national security,” chief executive Armin Papperger told the Financial Times in March.

Brandtzæg also urged the industry not to focus solely on capacity issues. Donating so much Western artillery and armament to Ukraine means Russia is likely to acquire most of its technology through the field and eventually seek to replicate it.

“There’s also a technology race . . . if we don’t spend more on R&D now, we could be caught up in 10 years.”

Brandtzæg said Nammo at the event demonstrated a high-precision munition with a longer range than before, which was limited to about 24 kilometers before and now has a range of about 40 kilometers. Soon new propellers will extend range to 60km to 70km, while future technology promises to extend range to 100km to 150km, he added.

Norwegian Brigadier General Beck echoed the message about not being complacent. He emphasized that the West must not waste the opportunity, because Russia lost a lot of personnel and materials in Ukraine, but started to put its own industry in a state of war.

“Are we moving fast enough? I doubt it . . . Now is the time to act. Everyone is talking about how underfunded we are. We need to ramp up production,” Baker said.

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