NATO's guncotton crunch threatens rearmament as Europe targets 20,000 tons

Europe must more than double its nitrocellulose production capacity to 20,000 metric tons annually to secure artillery supply chains that currently depend on China.

Europe's defense industry needs to more than double nitrocellulose output to 20,000 metric tons a year as NATO confronts a critical shortage of guncotton, the explosive propellant derived from cotton that powers virtually all modern artillery systems.

"You can invest in all the production capacity you want, but for much of the industry today, the real problem is those critical inputs, nitrocellulose and TNT in particular," said Peter Russell, head of investor relations at the Czechoslovak Group, a leading European manufacturer of 155mm artillery shells.

The shortage spans the Atlantic. The U.S. relies primarily on a single nitrocellulose factory in Virginia, while Europe operates several facilities — including one in Bergerac, France, where defense company Eurenco recently restarted production. Europe's current capacity falls well short of the 20,000-ton target industry leaders say is needed to cushion supply chains against disruption. TNT, the explosive filler in artillery shells, is equally scarce: Europe now has just one factory producing it, in Poland.

The bottleneck exposes a structural vulnerability in NATO's defense supply chain. European countries have long relied on China for both raw cotton linters and processed nitrocellulose, creating a dependency that Washington has sought to disrupt by sanctioning Chinese companies selling the material to Russia. Building self-sufficient capacity requires years of investment and regulatory changes, leaving NATO's rearmament timeline exposed to geopolitical risk.

The Czechoslovak Group, which acquired a German nitrocellulose facility, aims to secure the entire supply chain for artillery shells within its own European facilities by year-end. At its plants in Slovakia, hydraulic presses heat steel cylinders to 1,800 degrees Fahrenheit to shape warheads, while robots fill shells with TNT at a separate facility. A third factory assembles tiny igniter components that trigger the guncotton propellant.

German defense giant Rheinmetall is converting a civilian nitrocellulose site into a military-grade plant. Poland is building a new production facility. Eurenco is overseeing a pilot project in Sweden that seeks to turn textile waste into nitrocellulose. Norwegian-Finnish defense company Nammo produces nitrocellulose in Vihtavuori, Finland, using wood pulp sourced from Nordic countries — an alternative feedstock that Eurenco has also adopted.

A 19th-Century Invention Meets 21st-Century Demand

Nitrocellulose was invented in the mid-19th century by Swiss chemist Christian Friedrich Schönbein, who discovered that cotton became violently flammable after being dipped in acid. Unlike traditional gunpowder, it produced no smoke when ignited, making it valuable for military use. Today, the material acts as a propellant in artillery systems, triggering the gas expansion needed to launch 155mm shells up to 70 miles.

The last time NATO faced a comparable supply-chain crunch was during the Cold War buildup, when European nations maintained large domestic munitions industries. Decades of post-Cold War downsizing shifted production to fewer, more centralized facilities and increased reliance on foreign suppliers — a trend the current rearmament drive is now struggling to reverse.

The China Dependency Problem

Russia is equally reliant on Beijing for nitrocellulose, a supply chain the U.S. has targeted through sanctions on Chinese companies. For Europe, the dependency runs deeper: farmers replaced cotton with other crops centuries ago, leaving the continent without a domestic source of linters, the short cotton fibers used to make guncotton.

"We need to focus much more on having shorter supply chains that can even sustain a war," said Morten Brandtzæg, chief executive of Nammo. China and other countries "might not have the same objectives as we have, but are sitting on a critical supply chain."

Some industry leaders say they have been stymied by a reluctance in Western governments to commit to long-term defense contracts. That is slowly changing as the security environment deteriorates.

"It is the industry's responsibility to build capacity and do the investments. But in order to do that, we need long-term contracts, and that has been stated for years," Brandtzæg said. "Now, it's coming in our area, both on ammunition and on rocket motors for missiles and so on. And that is opening up the gate of further investments."

This article is for informational purposes only and does not constitute investment advice.