Hungary seeks supply chain independence with new ordnance plant
The new plant will produce explosives for MBT and artillery ammunition. Hungary is currently taking delivery of 24 PzH2000 self-propelled howitzers from Rheinmetall. (Photo: Hungarian Defence Forces)
Under a 15 December contract, Rheinmetall will fit out and jointly build and operate a Hungarian facility to produce explosives for large-calibre ammunition.
The Hungarian government has commissioned a new plant to produce RDX (Research Department eXplosive) at a site in Várpalota.
South Africa’s Rheinmetall Denel Munition will supply plant technology and the facility will be built and operated by a JV consisting of Rheinmetall and Hungary’s N7 Holding, a state-owned enterprise.
The contract is valued in the low three-digit million-euro range.
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Planning has been completed, with site work due to start in 2023, allowing production by 2027. The explosives produced will be used for artillery, tank, and mortar ammunition, inter alia.
The Rheinmetall contract covers plant engineering, technology, and processes as well as associated documentation and training.
A company release described the project as 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‘.
It will also promote Europe’s independence from overseas imports in this sector and forms part of Hungary’s Zrínyi 2026 initiative. Rheinmetall is already building 172 Lynx KF41 infantry fighting vehicles in Hungary under a 2020 contract.
When the plant is completed and taken over by the Hungarian government, Rheinmetall will be the primary customer for its products.
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