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Rheinmetall wins over $150 million contract to produce shells for Ukraine

by Nate Ostiller December 4, 2023 7:46 PM 2 min read
A Ukrainian soldier prepares 155mm artillery shells in his fighting position in Donetsk Oblast on Aug. 6, 2023. (Diego Herrera Carcedo/Anadolu Agency via Getty Images)
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The German arms manufacturer Rheinmetall won a 142 million euro ($153.7 million) contract from an unnamed NATO country to produce artillery shells for Ukraine, the company announced on Dec. 4.

The order involves tens of thousands of 155mm NATO standard shells and is expected to be delivered in 2025. It will be produced by Rheinmetall Expal Munitions, a Spanish subsidiary.

Rheinmetall previously announced on Oct. 10 that the German government placed an order for 150,000 artillery shells for Ukraine.

Demand for artillery shells has dramatically increased since the beginning of Russia's full-scale invasion, as Ukraine's allies seek to both deliver shells to Ukraine and refill their own depleted stocks.

Rheinmetall is planning for a "massive increase" of its production capacity in 2024, for a new overall annual output of around 700,000 rounds.  It is the largest producer of ammunition in the world.

Both Russia and Ukraine use a considerable amount of artillery shells, and there has been concern that Russia is gaining the upper hand in terms of shell capacity after allegedly receiving over a million shells from North Korea.

Ukrainian officials have claimed that the U.S.'s delivery of 155mm shells has decreased by more than 30% since the beginning of the Israel-Hamas war, a charge that the Pentagon denies.

Shell deliveries from Ukraine's European allies also appear to be falling short of their promised target.  Bloomberg reported on Nov. 10 that the EU is unlikely to fulfill its goal of providing one million shells to Ukraine by the March 2024 target.

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