Poongsan Corp., a prominent South Korean copper smelter and defense equipment manufacturer, has witnessed a significant surge in sales of ammunition and artillery shells in the past month, propelled by the prolonged conflict between Russia and Ukraine.
According to the Financial Supervisory Service (FSS) report on January 2024, Poongsan Corp. secured deals totaling 574.8 billion won ($465 million) with three Korean defense companies since December 20. This one-month figure surpasses the company’s total defense sales for the years 2020-2021, which stood at 549.4 billion won.
Specifically, Poongsan inked a 116.7 billion won supply deal with the state-run Defense Acquisition Program Administration (DAPA), a 293.4 billion won contract with Hyundai Rotem Co., and a 164.7 billion won deal with Hanwha Aerospace Co., as per FSS data.
Although Poongsan did not disclose specific details about the recent deals, industry observers suggest that a significant portion of the contracts with the three local firms involves 155 mm artillery shells for DAPA and Hanwha’s K9 self-propelled howitzers, along with 120 mm tank shells for Hyundai Rotem’s K2 Black Panther battle tanks.
Analysts attribute Poongsan’s robust sales partly to the prolonged conflict in Ukraine. Another Korean defence company Hyundai Rotem delivered the first batch of 10 K2 Black Panther tanks to Poland in December, part of a larger $3.4 billion contract for 120 tanks.
Similarly, Hanwha Defense Co. sent the initial 24 K9 self-propelled howitzers to Poland, part of a broader $15 billion deal between Korean weapons makers and Poland’s defense authorities, including the purchase of 980 units of K2 tanks, 648 units of K9 self-propelled howitzers, and 48 units of the FA-50 light combat aircraft.
Poland, a NATO member bordering Ukraine and the Russian enclave of Kaliningrad, has actively supported Ukraine by sending warplanes and other weapons.
As the geopolitical landscape evolves, with various nations prioritizing defense and security, Korean defense companies’ aspirations to establish a presence in the American market reflect their commitment to international partnerships and the pursuit of new opportunities. This move could lead to strengthened alliances, innovation exchanges, and mutually beneficial collaborations between Korean and American defense entities.