Rheinmetall secures another major contract for artillery ammunition replenishment

Rheinmetall has signed a €1.3 billion ($1.12 billion) framework contract with the German Armed Forces to supply several hundred thousand shells, fuses and propelling charges and signed a €127 million ($142 million) contract for a first call of shells with deliveries expected shortly.

The two deals relate to 155mm shells and are set to run through 2029.

Additionally, an existing framework agreement for DM121 ammunition has been expanded. In addition to the framework contract cited above, this represents an order volume of around €137 million ($153 million). 

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The volume of the existing framework contract thus increases from €109 million ($122 million) to a total of €246 million ($276 million).

Featuring insensitive characteristics, the DM121 high-explosive shell is used for training and exercise purposes.

These new deals follow an announcement earlier this week of a framework contract with Rheinmetall to provide 120mm tank munition to a value of €4 billion ($4.49 billion). 

A first call-off of ammunition worth €309 million ($346 million) came immediately after signing the contract.

The flurry of orders and framework agreements with Rheinmetall comes in the face of massive demands for ammunition and shells from Ukrainian forces as they attempt to combat Russian forces which invaded the country in early 2022.

Ammunition for artillery pieces, specifically 155mm rounds, is in high demand worldwide, driven by partners drawing down the stocks to donate to Kyiv while also looking to increase their stockpiles.

In March, the EU agreed to supply Ukraine with a million shells over 12 months. The €2 billion ($2.24 billion) plan will see half earmarked for the immediate delivery of shells to Ukraine and the other half for joint procurement of further stocks. 

It was announced that a commission would be set up to look into ramping up production capacity.