US Missile Stockpiles 50% Depleted, South Korea's Defense Industry Steps In | April 23, 2026

Investment Implications

Half of America's Missiles Are Gone. South Korea Is Filling the Gap.

Seven weeks of war with Iran burned through nearly half of US missile stockpiles. Replenishment will take at least four to five years — and South Korean and Japanese defense firms are already stepping into the void.

According to CSIS analysis, the US expended at least 50% of its THAAD missile inventory, approximately 50% of Patriot air defense interceptors, and roughly 45% of its Precision Strike Missiles (PrSM) during seven weeks of war with Iran. Tomahawk stocks dropped about 30%, JASSM by over 20%, and SM-3 and SM-6 by approximately 20%. Replenishing these systems will take a minimum of four to five years.

The critical factor here is time. During that four-to-five-year replenishment window, the US industrial base alone cannot meet demand. Signals that this gap is translating into real orders for allied defense firms arrived simultaneously today.

Hanwha Aerospace signed an MOU with Northrop Grumman to co-develop the first-stage solid-fuel rocket for the Advanced Reactive Strike (AReS) missile system. A South Korean company is being directly integrated into a US defense prime's missile production line. On the same day, LIG Defense & Aerospace clinched a $94 million deal to export the Haegung surface-to-air missile system to Malaysia — the Haegung's first-ever export.

Japan is also moving. On Tuesday, Tokyo lifted restrictions on exporting finished defense equipment, clearing the way for sales of destroyers and other combat systems.

According to Yonhap, South Korea's defense exports exceeded $15 billion in 2025, with targets of $20 billion and 6% global market share by 2030. The South China Morning Post reports that the Cheongung-II surface-to-air missile system is priced at roughly one-third of the US Patriot, and combat-proven performance triggered urgent follow-on orders from the UAE. As US stockpiles drain, demand for price-competitive, battle-tested South Korean defense systems will only intensify.

What makes the South Korean defense sector worth watching isn't just rising exports. It's the structural integration into US missile production lines that's beginning. The Hanwha–Northrop MOU is the first case.

Key Developments

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