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The old Krudten ammunition plant, near the northernmost tip of Denmark, is a quiet shell of a factory that has sat empty for years despite its legacy of churning out bullets, artillery and explosives for the Danish military.
But that is about to change: With the war in Ukraine fueling growing demand for Western weapons, the Danish government has decided to revive its role in the ammunition business.
In 2008, amid defense cutbacks that swept across Europe and cratering global economies, Denmark sold off Krudten, its military’s main munitions plant. It was passed around among private firms until October, when the government decided to buy it back, becoming one of the latest countries to increase its focus on weapons manufacturing and counter Russia’s rapidly expanding arms industry.
“It was crucial to get this plant,” the Danish defense minister, Troels Lund Poulsen, said in an interview this month, noting “a greater demand for ammunition” across Europe.
“We should be concerned because Russia is ramping up production of ammunition and also other kinds of military equipment,” Mr. Poulsen said. “That’s the reason why we have decided in the European Union that you have to support countries doing what they can to ramp up production.”
Officials from NATO countries worry that Ukraine will run out of weapons early next year, given that Republicans in Congress have blocked additional U.S. military aid and Hungary has vetoed another financial package from the European Union. Russia’s skyrocketing weapons industry has triggered palpable anxiety within NATO — not only because it has helped stall Ukraine’s six-month counteroffensive, but also as a sign of Moscow’s growing might.
That has sent European countries searching for ways to increase their own weapons production, including loosening regulations and incentivizing investment.
At Krudten — which translates from Danish to “the gunpowder” — officials hope to hire a private company to produce ammunition in the state-owned factory, which is housed in aging brick buildings across a sprawling rural campus.
That is a model similar to military ammunition production in the United States, where plants are owned by the government but run by private contractors who are backed by federal funding to quickly adjust to market demands. By early next year, the United States is projected to have more than doubled its monthly production of 155-milimeter caliber rounds to 36,000, up from 14,000 when Russia invaded Ukraine in February 2022.
But in Europe, where countries have diverse economies, budget constraints and a range of government regulations over defense industries, there is no single standard for partnering with weapons producers. To speed approvals, the European Union is offering financial incentives to states that jointly order large amounts of ammunition and is considering easing regulations that industry executives say have curtailed production.
The attempt to forge closer ties between governments and manufacturers comes as a E.U. campaign to provide one million 155-millimeter rounds to Ukraine within 12 months is expected to fail. With four months until the March deadline, officials have secured fewer than half of the shells that were promised because European capitals have been reluctant to invest in weapons producers that need more resources and fewer supply-chain bottlenecks to deliver.
“Overall, our instruments for cooperation are still punching below their weight,” Ursula von der Leyen, the European Commission president, said at an annual European Defense Agency conference late last month.
She suggested that E.U. sanctions against states with ballooning national deficits might be forgiven if increased defense spending contributed to the rise. “This could be a game changer for the union’s defense and its defense industrial policies in these exceptional times,” Ms. von der Leyen said.
It is likely to be an uncomfortable adjustment for governments and industry alike.
“I’m not a huge fan of government-owned production, but the base line for me is that there is an extreme demand out there and not enough production capacity,” said Joachim Finkielman, the director of the Danish Defense and Security Industries Association.
Currently, he said, Denmark gets its military ammunition from foreign producers. Once the Krudten plant is up and running, which could take around two years, the government will need to invest enough to ensure enough ammunition will be made to supply the Danish military and export to customers abroad “in order for this to work as a business opportunity,” Mr. Finkielman said.
“The idea of government stepping in, both with a signal of political intention to set up a market and actually providing this factory for industrial use, I think is an interesting step,” he said.
Finland’s Defense Ministry announced this month that it would double its capacity to produce a range of heavy ammunition calibers and explosives by the end of 2027. Under the $131 million deal — including $26 million from the government — at least some of the work will be done at a small-arms plant operated by Nammo, the Norway-based ammunition company in which Finland indirectly owns a stake.
“With this decision, we want to show our long-term commitment to support Ukraine as well as to strengthen the defense industry,” Antti Hakkanen, Finland’s defense minister, said in a statement.
The willingness to work more closely with industry appears most intense in states nearest to Russia’s borders. Some countries in Eastern Europe — including Poland, Bulgaria and Romania — own at least a share of their national ammunition producers.
Still, manufacturers across Europe have repeatedly asserted that their ability to meet the demand for weapons that has significantly increased with the war in Ukraine would take more time and money than most governments have been willing to commit.
That is in stark contrast to Russia, where the economy is controlled by President Vladimir V. Putin’s government and loyalist oligarchs who can command raw materials and labor to be diverted to the weapons industry from civilian manufacturers. Over the past two years, Russia has increased its monthly production of long-range missiles to more than 100, up from about 40 in February 2022, according to Justin Bronk, a senior research fellow at the Royal United Services Institute, a British research organization.
It has also nearly doubled production of artillery shells, and Mr. Bronk predicted that Russia’s weapons industry would “significantly increase” over the next two to three years, even as the West is wavering on whether it will commit more military aid to Ukraine. Nearly one-third of Russia’s spending next year, or about $109 billion, will be devoted to the military. And for the first time in its modern history, experts have said, Russia will spend 6 percent of the nation’s total output on its military — more than double what it was before the invasion.
“All of their economy right now is building weapons, building arms,” Estonia’s interior minister, Lauri Laanemets, said this month. “Even the manufacturers that used to do canned goods are basically producing bullets these days.”
Ukraine, which was once a main supplier of weapons to Moscow’s military when it was part of the Soviet Union, is trying to build up its own deflated arms industry.
It has begun to partner with weapons manufacturers, including in Britain and Germany, and top Ukrainian officials met with American executives in Washington this month to advance production and trade agreements that President Volodymyr Zelensky of Ukraine said could “launch defense projects that will be significant for the security of entire Europe.”
But Mr. Putin appears to be counting on waning Western support to win his war, Jake Sullivan, the White House national security adviser, said in an interview.
“He’s been quite public and vocal about his notion that if military aid from the United States ceases, it will mean that Russia will defeat Ukraine,” Mr. Sullivan said. “I think Ukraine is going to stand up and fight no matter what, but their ability to advance and their ability to defend will be substantially constrained and reduced by the lack of continued supply of U.S. munitions and capabilities.”
In Denmark, officials would not discuss how much ammunition the Krudten plant was expected to produce — or how much it manufactured before it was sold in 2008 to the Spanish firm Expal, which was taken over by the German munitions giant Rheinmetall in August.
The Krudten plant was sold in 2020 to a Danish group that turned the site into an office park. When the plant was put up for sale this past spring, the Danish government bought it to make sure it would be used only to build ammunition.
Denmark paid about $2.8 million for Krudten — $200,000 more than it sold for in 2008. It will also take millions of dollars to refurbish the buildings and, potentially, buy assembly line equipment.
Mr. Poulsen, the Danish defense minister, said he knew of no other NATO nation that has bought a manufacturing facility in order to produce more ammunition.
“We have seen serious problems concerning being able to produce ammunition,” Mr. Poulsen said. “Right now, Denmark is trying to do what we can.”
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