Rheinmetall To Set Up RDX Plant In Hungary In Response To Increase In Demand
German defence giant Rheinmetall announced on January 4, that it had won a triple-digit million euro contract for setting up an explosives factory in Várpalota, Hungary. The Hungarian state is building the plant to produce RDX. Rheinmetall Denel Munition Pty (Ltd) from South Africa is supplying the necessary plant technology.
Under the contract signed on December 15, 2022, a new plant will be built and operated by a joint venture consisting of Rheinmetall and N7 Holding, a state-owned Hungarian enterprise. Production is planned to commence by 2027. Once completed and taken over by the Hungarian state, Rheinmetall AG will be the primary customer for the explosives produced by the plant.
The project is a strategic investment by Hungary in cooperation with Rheinmetall in response to the shortage of explosives resulting from strong demand for ammunition in Europe and NATO. At the same time, it promotes Europe’s independence from overseas imports in this sector.
The Russian invasion of Ukraine has triggered this unprecedented demand for ammunition as supplies to Ukraine have depleted allied stocks. This has caused these nations to buy ammunition even from countries such as Pakistan, which are then provided to Ukraine.
Lately, Ukraine has commenced production of its own ammunition. OF-25T 152mm HE shells have been identified as being used by Ukrainian troops. This would ease the supply chain issues faced by allied nations.
Ukroboronprom is also producing other types of ammunition such as 122mm shells. Russia has faced such ammunition shortages as well, causing it to reportedly rely on North Korea for some ammunition.
The explosive produced in the new plant can be used for artillery, tank, and mortar ammunition, among other things. The contract covers the supply of plant engineering, technology, and process know-how as well as the associated documentation, training, and all activities necessary to achieve full-scale production, Rheinmetall stated.
Rheinmetall Denel Munition (Pty) Ltd specialises in the development, design and manufacture of large- and medium-calibre ammunition families and is a world leader in the field of artillery, mortar and infantry systems as well as plant engineering.