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Betting on Industrial Valves and Fittings

MES-Betting-on-Industrial-Valves-and-Fittings

At MES Inc. we acknowledge the importance and relevance of industrial valves and fittings manufacturing for a myriad of industries in North America. Although we have witnessed a slow-down of the heavy manufacturing and drilling activities over the past few years, the demand for valves, pumps and fittings has remained relatively constant. While industry revenues declined 5.2% in 2015, and is forecast to decline a further 2.8% in 2016, the industry revenue is expected to grow an annualized 1.6% to $23.2 billion over the five years to 2016 (IBISWorld).

The estimated growth is not so much related to a rebound of the petroleum production and refining industries. But because valves remain a vital component in a wide range of manufacturing processes and manufacturing activity and aside from petroleum refining and distribution, valves have applications in markets that range from construction to pharmaceutical manufacturing and wastewater treatment.

The construction of new water and sewage pipelines and systems and the refurbishing of aging infrastructure relies heavily on valves and related parts. New residential construction activity has increased considerably since the housing market crisis, with the housing market expected to increase at an annualized 13.5% over the five years to 2016. The value of utilities construction is expected to rise 5.5% per year on average over the same period. Improved construction activity has helped boost demand for industrial valves used in waterworks projects, indirectly boosting demand for hydraulic valves used in the manufacture of construction vehicles and other mobile applications.

According to IBISWorld, one in two valves purchased in the US is imported, most likely from China or Mexico, which has intensified price-based competition on industry operators. Because of the variety in products, their applications and markets, the industry as a whole is fairly fragmented with some big names controlling a specific product or application. For example, Tyco Flow Control, the largest manufacturer, accounts for less than 10% of industry sales. This leaves room for the Asian valve suppliers to compete internationally.

MES Inc. is proud to announce that it is expanding the industries it serves to include hydraulics. We have acquired the assets of Salcon Valve took over their key customers including Siemens, Emerson and Dresser Rand. This constitutes the first of a series of mergers and acquisitions meant to strategically boost the growth of MES and integrate those capabilities valued and sought by our customers. Counting on the support of industry experts, we are happy to grow our expertise and extend our reach as well as diversify our portfolio of products and clients.