After Russia's full-scale invasion, Joakim Sjöblom wanted to enter the defence sector. A market analysis pointed to a bottleneck, and today his company SWEBAL is building Sweden's first TNT factory in thirty years, in Nora (central Sweden). The goal is 4,000 tonnes per year, which he says would increase Europe's supply by three quarters, yet would still only be enough for just over a month of war. The road there has gone through five permits and all the way up to the Supreme Court.

Nordic Defence Sector's editor-in-chief Jacob Wollheim meets Joakim Sjöblom over a cup of coffee in the press room at DALO Industry Days. Neither he nor co-founder Carl Duforce has a military background. Sjöblom sold his previous company in early 2024, around the same time as Sweden's NATO accession. After Russia's full-scale invasion, he wanted to enter the defence sector, and the starting point was a market analysis.

The trip to DALO Industry Days is sponsored by BAE Systems Bofors

"It was an analysis presented by the British institute RUSI (Royal United Services Institute), which compared European and Russian production capacity," says Joakim Sjöblom. "At that time it was roughly a 600 percent difference. Russia was producing, in that case, six times as much ammunition as the whole of Europe."

When he spoke with the industry about why Europe could not scale up, the same answer kept coming back: a shortage of components and input materials, from rare earth metals to semiconductors to explosives. The founders first looked at a complete 155 millimetre shell, but quickly realised that would make them a competitor to the large established companies.

"That's not a market position I want," he says. "So we chose a narrow area where we can be a partner to the established companies instead of competing with them."

That turned out to be explosives, specifically TNT.

Why TNT?

The main reason is the supply chain. TNT is manufactured from four chemicals, Sjöblom explains: toluene, oleum, sodium sulphite and nitric acid, all of which are available in Sweden or around the Baltic Sea.

"We have an extremely tight supply chain in our case. So how can we ensure that we can produce even during crisis and war?"

According to him, TNT has two distinct advantages. It is cheap, roughly a tenth of the cost of more sophisticated explosives, and it is easy to cast, with little risk of cracking or bubbles. Above all, it comes down to cost at large volumes. Shooting down a cheap Shahed drone with an expensive Patriot missile does not add up economically, he argues, and that is where TNT can help bring down the cost of air defence. The same applies to drone munitions, given the quantities being consumed in Ukraine.

The material cost of the explosive itself is not the major expense, he points out. The point is the supply chain. Many more sophisticated explosives still depend on chemicals that are harder to access, and therefore often on Asian suppliers.

"Then we won't reach the goal of autonomy and industrial depth, of being able to produce on a European basis," says Joakim Sjöblom.

He prefers to describe the company as a scaling machine rather than an innovator. Sweden had TNT production until 1998, then under the name Nobelkrut, today EURENCO, and the effects of losing that capability just over thirty years ago are still being felt.

"Those who actually know this kind of production are, if they're still alive, over 80 years old today," he says, laughing. "So we've gained a lot of extra fathers and stepparents in this process."

The company has found a machinery supplier that has built TNT production lines before, and what they produce follows a common NATO standard, so that all NATO countries buy the same quality.

"I usually say that we don't work with innovation," says Joakim Sjöblom. "Our innovation is how we can produce as much as possible in as short a time as possible of a product that is already established."

What has the permitting process been like?

The site chosen was Nora (central Sweden). The whole of 2024 was a roadshow, he explains, with visits to 38 municipalities between Ånge in the north and Lund in the south (both in Sweden), before the choice came down to Nora, Kristinehamn and Eksjö (all in Sweden). Nora carried the most weight, partly because of the area's history in the explosives industry.

"Some municipalities recoil when you talk about military-related establishments. Nora practically welcomed us with open arms," says Joakim Sjöblom. "The attitude was that this is something the town knows how to do, it has done it for 150 years."

The regulatory review has been all the more demanding. The establishment requires at least five permits. The most discussed is the environmental permit, which is assessed under the Environmental Code. Because the facility handles such large quantities of chemicals, it is classified as a Seveso operation with an A classification, the highest level, which means the permit is assessed directly by the Land and Environment Court. The ground surveys alone, covering seismology, geology and groundwater, cost nearly 20 million Swedish kronor, according to Sjöblom.

The permit was granted in December 2025, appealed by a nearby resident to the Land and Environment Court of Appeal, and then further to the Supreme Court, which ruled in the company's favour during the summer of 2026.

"Just the appeal period took longer than the Land and Environment Court's handling of the case, which some might consider absurd," he says.

And that is just one of five permits. Still outstanding is the detailed development plan, which falls under the municipality's authority and has not yet gained legal force, a permit from MCF (formerly MSB, the Swedish Civil Defence and Resilience Agency) under the Act on Flammable and Explosive Goods, an underwater line for electricity and water assessed by the County Administrative Board, and a reinforcement of the access road owned by the Swedish Transport Administration. Five authorities, and in practice five bodies, any one of which could stop the project.

Why get involved in something with so much uncertainty?

You have to carry out some kind of qualified risk analysis, he says, both as an investor and as an operator within the company. The first question is which permit is the hardest to obtain.

"By definition, the Environmental Code is the toughest law," says Joakim Sjöblom. "Since we have completed our environmental permit, statistically there should be no heritage or environmental obstacles in any of the other processes either."

The second question is who the counterparties are. If the municipality, the County Administrative Board or the Swedish Armed Forces had appealed, the risk would have been high, he argues. In SWEBAL's case, it is only civilian residents nearby.

"Then the risk that they will be granted a hearing in the review is comparatively low," he says.

Ground works such as forest clearance and excavation can begin now, but construction of the building itself requires the detailed development plan to gain legal force. The investment is close to one billion Swedish kronor, the facility is expected to create around fifty jobs in Nora, and TNT deliveries are planned for the second half of 2028.

What does 4,000 tonnes mean in context?

Four thousand tonnes per year is the target, and Sjöblom puts the figure in context. Today there is only one TNT factory in Europe, in Poland, producing 6,000 tonnes.

"We are increasing Europe's supply by 75 percent," he says. "Or put more simply: a 155 millimetre shell for, for example, the Archer artillery system contains ten kilograms of explosive. Four thousand tonnes would therefore be enough for 400,000 shells."

At the same time, Ukraine and Russia together consume 7,000 to 10,000 shells a day.

"Our annual production would cover roughly 40 days of active warfare. So we need considerably more," he says. "Europe's need is estimated at between 30,000 and 35,000 tonnes. And we will be producing four thousand."

The volume has been set based on what the company assesses it can sell, rather than on need. TNT is difficult to store, and unsold volume creates both costs and regulatory risks. The fact that the machinery supplier had already built production lines of roughly the same size also made the engineering work simpler. The company has purchased more land than a single production line requires, but the permit only covers the first factory.

"I've built companies for long enough not to spread my focus too thin," he says. "Once this factory is operational and generating cash flow, then I can consider the next step."

How do you avoid political dependencies?

Interest in replicating the model in other countries is significant, says Sjöblom, but he prefers cooperation within the EU, with bilateral trade arrangements where member states buy from one another instead of everyone producing everything. The company deliberately tries to avoid political dependencies, and SWEBAL never sells directly to a state.

"We only sell to producers," he says. "If Sweden were to buy ammunition from Rheinmetall, Nammo or BAE, then we could be a subcontractor there. We are not dependent on state ownership."

SWEBAL was one of five companies in the government's 500 million Swedish kronor investment to strengthen Sweden's security of ammunition supply. The support is a state co-financing of the companies' applications for EU funding under EDIP (European Defence Industry Programme), and the money comes from the 25 billion Swedish kronor for urgent procurement approved by the Swedish parliament (Riksdag) in the 2025 spring amending budget. EURENCO was also among the other companies included.

"It's encouraging to see that people are now starting to look at the component level," says Joakim Sjöblom. "It's not enough for us to be able to assemble a finished shell. We also need to look at where the semiconductors, the propellant and the explosives come from."

To others who want to enter the defence sector, he offers two pieces of advice. Do not build something that competes with the established players, who have strong lobbying power, but instead find a niche where you can coexist. And do not underestimate the step up to mass production.

"It's fairly easy to do the innovation work on ten units. Scaling up is a much bigger challenge," he says. "When you go from ten units to ten thousand, that's when all the permitting processes, billion-kronor investments and factory staffing come into play."