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Buhlmann: Assessing Project Pipelines and Remaining Optimistic

By Peter Appleby | Thu, 09/17/2020 - 09:44

Q: In which areas of the value chain is Buhlmann most involved?

A: Buhlmann is a premium distributor that specializes in pipes and fittings for several market niches. The most important niches for us are refinery and petrochemical applications and, our strongest area, power plants based on combined-cycle plants. Oliver Buhlmann, our CEO, is the Buhlmann family’s third-generation. We have a turnover of more than €300 million around the world, with warehouse facilities concentrated in Germany, Netherlands and Singapore. The Americas is not our main market yet, but we are considering more activity here. The company employees around 700 people in 20 countries.

As a distributor, we have a broad range of agreements and working relationships with worldwide key manufacturers and suppliers of pipes, fittings and flanges. This, gives us flexibility and we can offer competitive advantages to our customers by offering immediate availability of our owned stock or third-party supply program and, in case of unavailability from one manufacturer or supplier, we have some other options or alternatives to our customers.

 

Q: What does the journey for Buhlmann’s products look like before arriving to Mexico?

A: Any of the products we deliver to Mexico usually arrive through the major ports and airports. If products are coming from Europe, they will normally arrive at the Port of Altamira or Veracruz. Pipes are heavy and are generally transported by ships. When we move fittings, they are often flown directly into Mexico City Airport. Products that come from Asia, including China, South Korea and Singapore, are shipped directly to the Port of Mazanillo on Mexico’s Pacific Coast. From there, we transport them to their final destination by trucks. Delivering that final mile is no problem for us as we have many years experience delivering directly to the customers´ sites, when required.

 

Q: How have the restrictions on movement impacted the company’s ability to transport products?

A: We have been affected, but thankfully not too heavily. While order numbers have certainly fallen, the orders we have received are robust enough for us to continue working. We have continued operations at our offices and warehouses, providing support for inquiries, offers and expediting to our clients. We have not canceled the projects or plans that we had foreseen for Mexico at the start of the year. My primary role at Buhlmann Mexico is to expand the company’s presence in the country, and this goal has not been negatively impacted by the pandemic. We will maintain our progress targets, although our plans may be adapted, or we may see slight delays, further along the line.

 

Q: What sets the quality of Buhlmann piping and fixtures apart?

A: A real benefit for clients is our large portfolio of products with reliable supply channels worldwide, combined with technical expertise and highly qualified staff. Not all players can offer all materials, but we are flexible to provide the majority of them by offering quality products from premium suppliers. Alloy and special steels are our main specialty that not everybody can provide. One of our competitive advantages for our customers is our supply program based on seamless and welded pipes in diameters up to 1,016 mm and wall thicknesses up to 110 mm, including pipe and pipe fittings from carbon steel through stainless to titanium and nickel alloys. Our product range includes all regular EN, ASTM/ASME and API Standards.

Materials origins are coming from any place, the US and China, though the majority comes from Europe. Price differential is also an important matter. When we get large orders of many items, we are able to offer different suppliers, not only from Europe but from China and USA to put together the best package deals for the clients. The larger the order, the better the quote we could provide to the client from different sources and suppliers. We have succeeded in working with some of Mexico’s major players because Buhlmann has an integrated QEHS management system, according to ISO 9001, ISO 14001 and OSHAS 18001, combined with high-performance logistics: direct delivery wherever and whenever it is needed and extensive experience of customs regulations in Mexico. This is required by the industry, which is highly specialized.

 

Q: What projects would Buhlmann like to work on in Mexico in the future?

A: The Dos Bocas refinery is the largest project in Mexico. With PEMEX projects there are a number of different players, including national and international EPC contractors. These companies have different scopes and, therefore, require different materials. Despite COVID-19, we continue operations at our headquarters, warehouses and offices, providing support for inquiries, offers and expediting to our customers. Buhlmann is doing business with companies in Mexico, but there is currently a three to four-months delay for main projects in general. We are also involved in some of the maintenance and rehabilitation projects of other PEMEX refineries since the administration is injecting resources to recover the production capacity. We expect this work to continue in the long run. Additionally, Buhlmann is also interested to participate in combined cycle power plants sponsored by with CFE. There are many changes happening on these projects, including the slowdown produced by COVID-19 with consequences for CFE to search for a different financing mechanism. We believe that, sooner or later, these projects will continue and contracts will be tendered by end of the year.

The chemical and petrochemical industry in Mexico is also a source of work for Buhlmann. There are several large companies in the market here and they need regular maintenance works. These companies are also preparing to move ahead with new plants and we want to be part of their plans.

 

Q: What will Buhlmann be focusing on in the coming months?

A: Buhlmann must prioritize the projects on which we are planning to work in the near future. With the current instability in the market, there is the risk that poor selection of projects will result in lost resources. Therefore, we must be selective and pay attention to details in order to increase our projects´ hit rates and company´s success. The industry’s major projects have not been canceled. As a result, we are optimistic about the future, expecting that some projects to be delayed by up to 18 months in some cases. Nevertheless, many of them will become active to enable our initial expansion plans in Mexico to continue in the next years.

 

 

Buhlmann is a family-owned German distributor specialising in tubes, pipes and fittings in carbon, alloy and stainless steelwith 136,000 m2 warehouse capacity and stocking approximately 60,000 tons. The company specializes in providing piping systems to process plants, combined cycle power plants, refinery and petrochemicals and has a presence in 20 countries.

Peter Appleby Peter Appleby Journalist and Industry Analyst