Corrects paragraph 5 to say that production of qualification rounds, not commercial production, would start inside this year

WARSAW, Feb 11 (Reuters) - U.S. defence supplier Northrop Grumman NOC.N and Polish arms group Niewiadow-PGM GNSP.WA aim to make more than 180,000 artillery shells annually in Poland, Northrop Grumman's managing director for Poland said on Wednesday.

Niewiadow said on Tuesday that the companies had signed a framework deal to jointly produce the 155-mm ammunition.

When asked about the expected production volume, Quinn Canole, Northrop Grumman's managing director for Poland, pointed at Niewiadow's output target of 180,000 shells per year.

"The capacities that we are able to support with our technology can support that level of production," Canole told Reuters.

Production of qualification rounds would start "definitely inside this year," he said, and future commercial production would cater to the U.S., Polish and broader European market. He did not rule out sales to Ukraine. The 155-mm shell is widely used by Ukraine in its war with Russia, but has been in short supply.

NORTHROP GRUMMAN ADVANCING TECHNOLOGY

Cooperation with Niewiadow would help Northrop Grumman further its Austempered Ductile Iron technology, an iron heat treatment and casting method, which uses cheaper and quicker-to-adapt commercial processes in artillery round production than traditional forging methods, Canole said.

"Given the strong need in this region, we felt that Poland was a natural location to help bring forward this technology on an international basis."

He added that using ADI enables boosting production.

"As this technology matures, as it gets out into the field, and as it proves itself over time, we're going to be able to scale that capacity greatly."

Also speaking to Reuters, Krzysztof Krystowski, Northrop's country manager for Poland, called the deal a "natural opportunity" given the ramp-up of defence spending in Europe. Poland expects to spend a NATO-leading 4.8% of its gross domestic product on defence this year.

Krystowski said the company decided about two years ago "that Poland would become a strategic continental Europe location of Northrop Grumman because of Poland's spending on defence and the importance of Poland from a security point of view, but also from an industrial point of view."

He added that separate talks with Polish state-controlled ammunition maker Mesko regarding co-production of 30-mm and 120-mm rounds were "very advanced."

"Poland is a strategic market for Northrop and for our plans related to the development of our industrial footprint in this country."

(Reporting by Karol BadohalEditing by Rod Nickel)

((karl.badohal@thomsonreuters.com;))