Estonian company could start producing munitions this year

Considering that European countries have still not given their defense contractors sufficient guarantees, efforts to stock up on ammunition need to be diversified. The Baltics are once again mulling local production, and it is possible A to Z ammunition manufacturing will start in Estonia this year.
Commander of the Estonian Defense Forces (EDF) Gen. Martin Herem, who will step down in June, is not wasting his last weeks in office. Estonia does not have enough artillery and precision munitions to cause a potential enemy to withdraw from Estonian territory, he said. The country needs ammunition and fast.
"The losses that we could inflict on the aggressor today do not meet Russia's threshold for pulling a unit off the front. We are in a hurry. I would not seriously consider projects that take longer than three [years], not to mention five years," the general said.
Estonia has donated equipment and munitions. We must support Ukraine, even though we're cutting into the muscle instead of just the fat now. And one needs to build up one's muscles again, Herem noted, adding that procuring munitions from abroad is the best option.
"What I don't believe we'll see are allied donations. I have not seen real investments into the kind of munitions we need over the past few years," the general remarked.
But this raises the question of what could be produced on location. Herem points to the example of Ukraine – assault drones. Two kilograms of explosive mass, a 20 percent chance to destroy the target, but it's also 20 times cheaper than an anti-tank missile.
"We're talking about explosives that can be flown five or more kilometers away – no matter by what kind of drone or jet propulsion system. I believe anti-aircraft guns and equipment could be manufactured in Estonia. From heavy machine guns and their ammunition all the way to missiles of some sort. I also believe Estonia could manufacture more sensors."
The general is not talking about missiles for long-range precision systems like HIMARS or Patriot. But this still leaves the question of uncertainty.
"There is no certainty [of orders] today. I've met with quite a few entrepreneurs who believe they could build these things. But they cannot be sure they'd be commissioned," Herem admitted.
There are also no available funds. The defense budget is planned several years in advance and is currently not large enough for sufficient munitions procurements.
Darius Antanaitis, owner of Lithuania company Ostara, gave the example of a Lithuanian state-owned company that manufactures cartridges. But even the latter has no certainty of public sector orders.
"And to be honest, local companies do not always win. I'd even say they usually lose at public procurements due to their relatively higher price," he said.
Ostara manufactures a diesel hybrid buggy called Krampus and is looking for investors. It is possible Antanaitis will not be the owner of the controlling share for much longer.
"The Lithuanian army is not our main customer. We mainly work with major defense contractors like Krauss-Maffei-Wegmann, Nexeter, Lockheed Martin and others. We are looking for investors to grow our volumes and take the next step," the businessman said.
Lithuania is in talks with major German company Rheinmetall for an artillery ammunition plant in the country, while Latvia is building a gunpowder factory. Estonia is also making preparations for a defense industry park development. A number of locations have been picked for consideration, while it remains unclear who will be producing what at the park.
Indrek Sirp, defense industry adviser at the Estonian Ministry of Defense, said that the government hopes to have a detailed plan by August 2025 and is in talks with potential tenants.
What about Estonian defense contractors? The EDF uses Estonian-made M-14 directional side mines against personnel and armored vehicles. Jens Haug, board member of manufacturer Eesti Arsenal, said raw materials are difficult to source, and the firm has to look beyond Europe to India, Vietnam and Latin America.
"The defense industry is heavy industry. It is not like assembling an electric bicycle. We're talking about major investments, research and development, steep learning curves and testing. It's a long process and one we should perhaps have launched in 1990," Haug noted.
That said, he believes the defense industry park will prove useful. It is always good when the government creates conditions necessary for production in heavily regulated fields.
Haug said that Eesti Arsenal could start producing live munitions before the year is out.
"We are working hard today. We hope that Estonia will starting producing ammunition from start to finish this year. But it's too soon to say for certain," he added.
If production comes to Estonia, if Rheinmetall comes to Lithuania, if you can sign long-term contracts with foreign suppliers and if €1.5 billion can be found for additional investments comes together for a lot of ifs.
But there's also good news, Herem said. Ammunition transport has become easier.
"I do not see as many logistical issues today as I did a year ago. Finland and Sweden are NATO members. We have the capacity, as do a few other Baltic Sea states. I believe naval logistics can be handled from the first day of aggression," Herem suggested.
The general also said that he aims to try and secure €1.5 billion for additional munitions procurements before leaving office and handing over to Gen. Andrus Merilo.
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Editor: Merili Nael, Marcus Turovski
Source: "Aktuaalne kaamera"