China Halts Gunpowder Cotton Supply to FN Herstal

China has ceased supplying nitrocellulose — the essential chemical base for smokeless gunpowder — to Belgian arms manufacturer FN Herstal, a move that threatens to disrupt production at one of Europe’s most strategically important small arms companies. The supply halt, first reported by Belgian newspaper De Morgen, is a direct consequence of China’s decision in April to place seven European defense entities on its export control list over alleged arms sales to or collusion with Taiwan.

Context: What Is at Stake

Nitrocellulose, also known as gun cotton or “schietkatoen” in Dutch, is the fundamental propellant in virtually all modern ammunition, from pistol cartridges to artillery shells. It is produced by treating high-purity cellulose — typically derived from cotton linters — with nitric and sulfuric acids. Without it, ammunition production grinds to a halt.

China dominates this critical supply chain. According to industry analysis, China controls approximately 46% of global chemical sales and provides more than 70% of the cotton linters used by European ammunition producers. This dominance creates what analysts have described as a “strategic liability” for European defense manufacturers.

FN Herstal, founded in 1889 and headquartered in Herstal, Wallonia, is far from an ordinary arms manufacturer. It is one of the world’s oldest and most prestigious firearms companies, the largest exporter of military small arms in Europe, and a key supplier to NATO forces with weapons used by over 100 countries. Its iconic designs include the FN FAL, M249 SAW, SCAR, MAG, and Minimi machine guns. The company posted a profit of 75 million euros on 908 million euros in revenue in 2023, its second-highest ever, and employs approximately 3,000 people. It is owned by the FN Browning Group, which is ultimately controlled by the regional government of Wallonia.

The Export Control Measures

On April 24, 2026, China’s Ministry of Commerce added seven European entities to its export control list, prohibiting the export of dual-use items to them. The listed entities include FN Herstal and Fabrique Nationale de Herstal (Belgium), FN Browning (Belgium), HENSOLDT AG (Germany), and four Czech-based firms: OMNIPOL a.s., EXCALIBUR ARMY spol. s r.o., SPACEKNOW INC., and VZLU AEROSPACE a.s.

As EU Today reported, the Chinese Ministry of Commerce stated that the measures target “a few EU military-related entities that were involved in arms sales to or collusion with Taiwan.” Beijing emphasized that the restrictions apply solely to dual-use items and should not affect normal trade and economic exchanges between China and the EU.

The practical effect, however, is far-reaching. Dual-use controls cover goods, technologies, and services with both civilian and military applications — including electronic components, specialist materials, sensors, and manufacturing inputs. For FN Herstal, the immediate consequence is the loss of access to Chinese nitrocellulose, a material for which few alternative suppliers exist at sufficient scale.

The Broader European “Powder Gap”

The FN Herstal supply halt is the most visible symptom of a deeper crisis in European ammunition production. European gunpowder plants import over 70% of their nitrocellulose from China, a dependency that the war in Ukraine has thrown into sharp relief. As European governments urgently expand ammunition production from tens of thousands to millions of shells annually, the upstream supply of nitrocellulose has emerged as a critical bottleneck.

The European Union has recognized the severity of the problem. Its ASAP plan allocates 2 billion euros for ammunition manufacturers, with 75% designated for building new powder plants. French gunpowder producer Eurenco is multiplying its powder production tenfold, with new production lines in Bergerac expected by 2027. German defense giant Rheinmetall acquired Hagedorn-NC in April 2025 to vertically integrate nitrocellulose production. Norwegian firm Nammo is leading research into wood-pulp-based nitrocellulose as an alternative to Chinese cotton linters.

But these efforts take years to materialize. In the short term, FN Herstal and other affected European defense companies face difficult choices: find alternative suppliers in an already capacity-constrained market, seek special export licenses from China’s Ministry of Commerce, or reduce production.

Strategic Implications

China’s decision represents a significant escalation in Beijing’s use of economic statecraft. By linking Taiwan-related activity to European defense supply chains, China has demonstrated that it is willing to leverage its raw material dominance to achieve geopolitical objectives. The timing is particularly strategic — the measures come as Europe is urgently trying to rearm and resupply Ukraine.

According to Wikipedia, FN Herstal’s firearms are used by the armed forces of over 100 countries, making any disruption to its production a matter of global concern. The company’s weapons are integral to NATO’s small arms inventory, and production delays could affect ammunition stockpiles and Ukraine aid commitments.

The EU is already weighing new supply-chain rules to reduce dependence on China, as reported on June 6. The broader question for European defense planners is whether China’s action signals a more assertive willingness to use export-control tools against European firms over Taiwan-related activity — and how to build resilience against such leverage in the future.

What to Watch For

Several open questions remain. Has FN Herstal been forced to halt or reduce specific production lines? Has the company applied for a special export license from Beijing? What is the official response from the Belgian and EU governments? And critically, can European nitrocellulose producers scale up quickly enough to fill the gap left by Chinese supplies?

The answers will determine not only FN Herstal’s immediate production outlook but also the future resilience of Europe’s defense industrial base. What began as a narrow export control measure has exposed a vulnerability at the heart of European security — one that will take years of investment and strategic planning to address.