Ottawa earmarks $1.4 billion for key munitions production in Quebec, Ontario

National Defence Minister David McGuinty speaks with media before attending cabinet meeting on Parliament Hill, Tuesday, Feb. 3, 2026 in Ottawa. THE CANADIAN PRESS/Adrian Wyld

OTTAWA -- The federal government is pouring $1.4 billion into the munitions industry to build up the domestic supply of heavy artillery shells and reduce Canada’s reliance on foreign suppliers.

Ottawa will put public funds toward new facilities in Ingersoll, Ont., and Repentigny, Que., for producing components used to make heavy artillery shells.

The funding will be split between IMT Precision and General Dynamics Ordnance and Tactical Systems Canada. General Dynamics Ordnance, a subsidiary of the major U.S. defence contractor General Dynamics, will get the lion’s share of the funds.

The goal is to quickly ramp up production of 155-millimetre artillery shells and to start production of nitrocellulose, a compound used as a propellant in artillery shells.

China currently dominates the global nitrocellulose market on which NATO countries rely. Western nations also have sanctioned nitrocellulose firms supplying Russia, further tightening the supply.

National Defence says it’s looking to get production of nitrocellulose up and running in the next three years.

The federal money is going in part to production of M795 shells. Canadian manufacturers produce a variant of the 155 mm shell known as the M107, a shorter-range and lower-power shell used for training and enemy harassment.

Defence Minister David McGuinty said the funding is “essential to national security” and will lead to new jobs.

“The ability to produce our own ammunition is not optional. It’s essential,” he said at a Wednesday news conference.

The industry has been waiting a long time for this.

The Canadian Association of Defence and Security Industries, which represents hundreds of domestic defence firms, has been aggressively pushing the government to restock the Canadian military’s ammunition stores and convert domestic munitions lines.

“It’s something that’s been dangling there for years, since the start of the war in Ukraine, really,” Christyn Cianfarani, the organization’s CEO, said in an email. “So it’s good to see they’re starting to roll this out.”

Canada has struggled with the task of replenishing its munitions stocks and has donated ammunition to shell-hungry Ukraine for use in its war against Russia.

Christian Leuprecht, a professor at the Royal Military College of Canada and Queen’s University, said this a good start but the federal government is still short a robust, sovereign supply chain that could get it through more than a few days of a shooting war.

“This stuff, we should’ve been doing a long time ago. Everyone wants to talk about drones but this is bread-and-butter stuff that the army desperately needs,” Leuprecht said.

He added that Ottawa needs to stop being squeamish about entering into long-term munitions contracts.

“Canada is notorious for, `Oh yeah, we’ll order 3,000 shells this year and the next year we’ll order 5,000.’ If you’re industry, you’re not going to invest hundreds of millions of dollars if you have no idea how much you’re going to be able to sell,” Leuprecht said.

McGuinty unveiled the funding at an IMT plant in Ingersoll, a community still reeling from layoffs at the General Motors’ CAMI Assembly factory. He pledged the new facility will lead to some 400 jobs.

McGuinty did not answer when asked about the prospect of converting the CAMI plant to the manufacture of military vehicles.

But the minister said the federal government is in talks with major car manufacturers about converting auto facilities to defence production and “will have more to say about this in due course.”

The funding breakdown has IMT receiving up to $305 million for a new factory to produce metal casings for 155 mm projectiles.

General Dynamics Canada will get just over $1 billion in funds.

The biggest chunk of that, $642 million, will go toward a plant to make 155 mm high‑explosive projectiles.

A further $355.7 million goes to setting up the nitrocellulose facility, while $57.9 million has been set aside to create Canada’s first plant making the M231 and M232 charges used in 155 mm artillery rounds.

The funding all falls under the new Canadian Defence Industry Resilience program, part of the Liberal government’s new defence industrial strategy aimed at building up domestic military supply chains and production capacity.

The Liberals are seeking to spotlight components of that strategy with a series of funding announcements this week.

This report by The Canadian Press was first published March 18, 2026.

Kyle Duggan, The Canadian Press