Hanwha is strengthening its supply chain for core materials used in guided weapons and rockets. This move expands production capabilities for upstream materials to support the expansion of defense exports, including the Chunmoo multiple rocket launcher system. The domestic defense industry is expanding supply chain investments from raw materials to complete weapon systems based on large-scale orders.
According to the defense industry on the 25th, Hanwha's Global Division, which handles industrial explosives and materials businesses, recently decided to invest in production facilities for ammonium perchlorate (AP), a core oxidizer used in solid propellants. Ammonium perchlorate supplies oxygen to burn fuel in solid propellants and is therefore used in guided weapons, rockets, and space launch vehicles. Regarding this, a Hanwha representative stated, "It is difficult to disclose specific details such as investment amount and production capacity due to the nature of defense business," expressing a cautious stance.
Hanwha has previously secured its own technology by developing ammonium perchlorate manufacturing technology and filing related patents. This investment appears to focus on expanding the production base for ammonium perchlorate based on existing manufacturing capabilities. The growing need to secure production capacity in downstream supply chains, including propellants and core raw materials, coincides with the recent increase in Hanwha's defense exports.
The expansion of Chunmoo exports is a prime example. Hanwha Aerospace's multiple rocket launcher 'Chunmoo' has achieved successive export results in Poland and Estonia, while actively targeting additional exports centered on the Middle East. Additionally, Hanwha recently established a joint venture with Polish defense company WB Group and began construction of a factory for local production of Chunmoo guided missiles. This decision is based on the judgment that as rocket system exports like Chunmoo expand, demand for related materials such as oxidizers will increase.
The possibility of expanded solid propellant demand due to entry into the U.S. market is also a key point Hanwha has in mind. Hanwha Aerospace was recently selected as the next-generation self-propelled howitzer contractor for the U.S. Army with its K9 self-propelled howitzer, establishing a foothold for entering the U.S. market through prototype development and delivery. The industry expects that the U.S. business will expand in the future to include ammunition supply systems, propellant charges, and maintenance, repair, and overhaul (MRO) centered on the K9.
As overseas orders for K-defense continue, moves to expand production capacity are spreading across the entire industry. With defense industry order backlogs exceeding 100 trillion won, investments in expanding facilities from downstream supply chains such as raw materials and components to complete weapon system production sites are proliferating. Hyundai Rotem has begun converting part of its existing railway factory into a K2 tank production line, while LIG Defense & Aerospace (LIG D&A) announced a 500 billion won rights offering (paid-in capital increase) plan to expand production facilities in Gumi and Gimcheon, North Gyeongsang Province. Korea Aerospace Industries (KAI) is also reviewing the expansion of fighter jet production facilities. Chae Woo-seok, Lee (President) of the Defense Industry Association, emphasized, "In the future, it is important not only to produce complete weapon systems independently but also materials."
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