Ukraine purchases 155mm Rheinmetall projectiles at three times the cost – media says

German arms conglomerate Rheinmetall has received a significant order for the supply of artillery ammunition following the second tender within the framework of a framework contract with the German government. In particular, this weaponry will be supplied to the Armed Forces of Ukraine.

This information has been reported on Rheinmetall’s website. The German government has ordered tens of thousands of L15-type projectiles and standard 155mm projectiles Assegai from the company, and the cost of the order falls within the lower range of a three-digit million-euro sum. However, the specific amount was not disclosed. The delivery of the ammunition is scheduled for 2024.

At the same time, the media reports that Ukraine is buying these munitions from Germany at three times the price. According to the publication Bulgarianmilitary, the contract involves the production of more than 100,000 units of 155mm projectiles through Expal, a Spanish company owned by Rheinmetall, acquired in November 2022 for a sum of 1.2 billion euros. Furthermore, the deal included the production of an undisclosed quantity of DM121 projectiles.

The publication notes that Rheinmetall’s somewhat cryptic announcement, mentioning “more than 100,000” and separately highlighting DM121, stems from the fact that DM121 is a recent development, and its production began only in 2017. By 2022, there was information about approximately 62,000 such projectiles. According to a 2019 contract, this innovative product costs the Bundeswehr 3,400 euros each.

The recent announcement of the Rheinmetall contract to some extent helps to estimate the current cost of the 155mm projectiles. The stated figure is described as a “three-digit average value in millions of euros.”

Therefore, speculatively speaking, we could be dealing with an estimate of around 100,000 155mm projectiles for 500 million euros. Even if we use a “mid-range estimate” of 400 million euros for 100,000 projectiles, each shell would still cost 4,000 euros.

This price not only surpasses benchmark indicators before a full-scale invasion but also exceeds prices after February 24, 2022. For example, Rheinmetall’s contract in December 2022 with an anonymous country for 10,000 155mm L15 projectiles had a price of 3,300 euros each.

It can be concluded that the cost of artillery projectiles is rapidly increasing. This trend is likely to continue until production scales up to meet the rapidly growing demand, leading to price increases.