SAHA 2026: Turkish company ARCA to build ammunition factory in Estonia

Photo of 122 mm rocket production at an existing Arca plant. (Arca)

Estonian Defence Minister Hanno Pevkur and Ismail Terlemez, member of the management board, Arca Baltic Operations, signed an agreement at the SAHA Expo 2026 exhibition held in Istanbul from 5-9 May for the Turkish company to build an ammunition factory in Estonia.

The Estonian Centre for Defence Investments (ECDI) announced in a press release on 22 April that Arca would build an ammunition factory in the North Kiviõli defence industry park in Estonia. The ECDI said that Arca would invest approximately EUR300 million (over USD353 million) in the 141 ha site, with plans to start production in 2028.

Estonian Defence Minister Hanno Pevkur said on 22 April that, “with the establishment of large-calibre ammunition production, Estonia is taking an important step in developing its defence capabilities and ammunition industry. Arca is a rapidly expanding defence company that has in recent years developed a significant ammunition production hub in Turkey. Arca Baltics Operations, established in Estonia, will build a factory in North Kiviõli where the primary focus will be on producing large-calibre 155 mm ammunition, including extended-range variants.”

According to the Arca Defense website, the factory will produce M107 155 mm artillery shells, 60 mm, 81 mm, and 120 mm mortar shells, and 122 mm rockets with a range of 20 km.

An ECDI spokesperson declined to give the production capacity of the factory but told Janes on 5 May, “The ammunition will be first and foremost exported. Estonia has a possibility to buy as well.” Arca Baltics Operations said the factory will mainly produce long-range 155 mm artillery rounds for the European and US markets.