Ukraine war leads France to restore gunpowder production

By John Irish

BERGERAC, France (Reuters) - Automated systems splutter as raw materials are fed into the machines to begin the process of creating highly-explosive pellets ready to be harnessed for use in thousands of French-made artillery shells, most of which will head to Ukraine.

Nestled in the backdrop of the rich medieval history of the southwestern Dordogne region, explosives manufacturer Eurenco is the first company to relocate production of a lost skill back to France and show that Europe can revive its defence industrial sector.

"To see that a country like France dropped its gunpowder production capacities at the start of the 2000s made absolutely no sense," Defence Minister Sebastien Lecornu said.

"We were capable of producing the body of the bomb, the modular charge, but not capable of producing the powder needed inside so we were dependent sometimes on Europeans, but other times from outside the European Union."

Backed by the government and with an investment of 100 million euros ($108 million) of which half came from an EU programme to support the bloc's defence industry, the firm put together new infrastructure in less than a year.

It will initially produce some 1,200 tonnes of gunpowder pellets a year, rising to 1,800 tonnes, which would feed into about 100,000 artillery shells, notably the NATO-standard 155mm caliber, used, for example, in the Caesar Howitzer canons.

Russia produces 30 times more, illustrating how much more Europe will need to do.

France has a tradition of producing gunpowder dating back to the 14th Century, and a long history of pride in being self sufficient in arms production.

Eurenco produced gunpowder as far back as World War One. But after the end of the Cold War, weapons production and supply chains were no longer a priority and governments scaled back.

France's focus shifted to more lucrative military hardware, such as Rafale warplanes, leaving smaller, less profitable businesses such as explosive powder production to wither, replaced by imports.

Eurenco, known for the making modular charges which propel artillery shells, abandoned powder production to affiliates in Sweden and Germany in 2007, and France was left entirely reliant on its overseas partners.

NO MORE DEPENDENCE

War in Ukraine is forcing Europe to reinvent its defence industry, with Moscow viewed as a threat and the United States under President Donald Trump a more unpredictable ally.

For weapons firms, the likelihood is that orders will not abate for many years to come, giving them an opportunity to invest and develop for the long term while offering job opportunities in areas previously abandoned.

Eurenco's project's director Damien Ayesa told Reuters 10% of the production would be domestic with the rest for export, much of that for Ukraine. The systems will run 24 hours a day, 7 days a week.

But none of this has been easy, and France's war economy is taking longer to get into gear than Russia’s.

Regulations, notably for safety, are strict. There is also the issue of raw materials. Two of the three key elements to produce the pellets are now sourced in France, but a third still needs to be sourced from overseas. Eurenco is studying how to resolve that supply chain issue, Ayesa said.

"Our objective is to be autonomous and sovereign," Ayesa said.

($1 = 0.9238 euros)

(Reporting by John Irish; Editing by Peter Graff)