ARCA Defense to Build 155 mm and Mortar Ammunition Plant in Estonia as NATO Eastern Flank Production Expands

Technical Summary

The Estonian Ministry of Defence and Turkish company ARCA Baltics Operations (trading as ARCA Defense) are signing a framework agreement this week at the SAHA Expo 2026 International Defence and Aerospace Fair in Istanbul (5–9 May 2026) to establish an ammunition production facility at the Pykhya-Kivili industrial park in northeastern Estonia. The site is located approximately 50 km from the Estonian–Russian border. Total Turkish investment is stated at €300 million; Estonia is contributing 141 hectares of industrial land and approximately €10 million in infrastructure preparation.

The declared production portfolio covers four conventional calibres: 155 mm artillery shells including long-range modifications, 122 mm rockets, and 60 mm, 81 mm, and 120 mm mortar ammunition. The facility is planned to reach initial operating capability in 2028, with a construction timeline of approximately 18 months from the signing date. In parallel, South Korean manufacturer Hanwha Aerospace is constructing a 40 mm ammunition production facility in the same Pykhya-Kivili industrial park.

Analysis of Effects

The 155 mm product line is technically the most significant element of this announcement. Depending on fuze and projectile type, 155 mm high-explosive (HE) shells are classified Hazard Division (HD) 1.1, Compatibility Group (CG) D (complete round with Point Detonating or Delay fuze) or CG F (fuze components separately managed). Long-range modifications—likely referring to Base Bleed (BB) or Extended Range Full Bore (ERFB) projectile families—require additional propellant charges for the base cavity or modified propelling charge configurations, each constituting separate Storage and Transport Quantity Distances (QD) considerations under ATP-3.2.1 and national Ammunition Technical Publications (ATPs).

The 122 mm rocket line almost certainly refers to the BM-21 Grad family (STANAG 4235 reference catalogue code Type 5), classified HD 1.1 D. These remain in wide NATO inventory through Eastern European member states. Production of 122 mm rockets by a NATO-adjacent Turkish firm in Estonia reinforces the logistics chain for Allies operating legacy Soviet-pattern artillery systems alongside modern 155 mm platforms—a configuration that has characterised Ukrainian-theatre munitions supply chains since 2022.

Mortar calibres (60, 81, 120 mm) are produced as complete rounds (HD 1.1 D) or separated into Propellant Increments (HD 1.3 C) and Fuze (HD 1.4 S) where relevant national doctrine requires separated storage. The 120 mm smooth-bore mortar round is the most logistics-intensive of the three, due to its higher Net Explosive Quantity (NEQ) per round (typical HE fill: 1.5–2.2 kg Comp B or TNT equivalent; DATA GAP: ARCA-specific fill not confirmed) and compatibility demands across the Rifled / Smooth-bore variants in NATO service.

The co-location of Hanwha Aerospace’s 40 mm line with the ARCA facility is noteworthy from an Explosive Storage Licensing perspective. Under NATO STANAG 2828 and the applicable Estonian national legislation implementing the ADR/RID framework, mixed-calibre production parks require detailed Explosives Storage Area (ESA) planning to ensure appropriate Inhabited Building Distances (IBDs) and Inter-Magazine Distances (IMDs) between separately licensed explosives storage structures. The proximity to the Russian border also raises Physical Security requirements likely to be governed by NATO STANAG 4383 and national Security Regulations for Munitions (SRMs).

Personnel and Safety Considerations

WOME practitioners advising on the facility’s design should note that a multi-calibre production campus at a location within 50 km of a potential adversary’s border will require an elevated Physical Protection Category under NATO AASTP-1 Part II (Safety Principles for the Storage of NATO Ammunition and Explosives), informed by current threat assessments for the region. Estimated production explosive inventory at any one time will determine the applicable Quantity Distance (QD) arcs and whether above-ground or earth-traversed magazine construction is mandated.

Manufacturing operations for 155 mm HE projectile filling involve Composition B (60/40 RDX/TNT) or TNT poured or pressed into the cavity behind the fuze well. Both processes require Type 1 or Type 2 Explosion-Proof (ExP) manufacturing bays, appropriate electrostatic discharge (ESD) controls, and continuous atmospheric monitoring for explosive vapour/dust. Personnel safety documentation should reference DSA 03.OME and AOP-7 Ed.3 (Safety Principles for the Design, Assessment and Approval of NATO Military Ammunition and Explosives).

Data Gaps

DATA GAP: Explosive fill composition and NEQ for each calibre variant not publicly confirmed—critical for QD planning. DATA GAP: Annual production capacity per calibre not stated in source material. DATA GAP: Propellant supplier and propellant type for 155 mm Modular Artillery Charge System (MACS) or equivalent not identified. DATA GAP: Fuze types (Point Detonating, Proximity, Delay) to be produced have not been specified. DATA GAP: Whether ARCA Defense holds or is seeking AQAP-2110 qualification under STANAG 4107 for any of the declared calibres is unknown. DATA GAP: Estonia’s national Explosive Storage Licensing Authority approval status for the Pykhya-Kivili site is not confirmed.

AI-assisted technical assessment based on open-source material. Not a formal intelligence product. Sources: Pravda NATO (24 Apr 2026), SAHA Expo 2026 official programme, Army Recognition, Defence Agenda.