War on Iran puts Made-in-Italy valves in crisis
Blocked orders, skyrocketing shipping costs: the region is worth 15% of exports, for some companies two thirds of business
by Luca Orlando
"What do some customers write to us? That due to force majeure they cannot collect the goods for the time being. And so they don't pay'. Luca Farina, CEO of Orion Valves, a manufacturer of valves for the oil & gas sector, which generates two thirds of its revenues in the Middle East and which a few weeks ago, before the crisis, fortunately managed to deliver a $3 million maxi-plant to Saudi Arabia, the largest valve in the world in its category. The difficulties of Arab customers in giving the go-ahead to ship these high-tech valves are now creating a - hopefully temporary - obstacle for the company worth a few million euros in lost revenue.
'Firm cargo creates problems,' the entrepreneur explains, 'and we are organising ourselves to find alternative routes, for example via Haifa and then by land. But freight rates have gone crazy'.
The attack on Iran and the blockade of Hormuz are certainly not the ideal scenario for the national sector most exposed to the area, with valves and taps accounting for 15% of total exports to the Middle East, almost four times the national average, around one billion euro per year. With difficulties concerning receipts but also logistics and future orders.
'This is definitely a labour-intensive area,' explains Lvf general manager Claudio Piccinini, 'and now everything is blocked. The orders we have reassure us for 2026, because the processing cycles in our sector are long. But the problem, if the situation does not unblock, will be for next year's volumes. Already on the alert, however, are customers in other areas, for example in the US, who are asking us about our supply chain problems: they want guarantees on future production, on which we see no problems.
'In the Emirates we have a sales branch with eight people,' says Vir owner Savino Rizzio, 10% of revenue in the Middle East, 'and for us this situation is a low blow. In the short term we manage, but we have to organise ourselves differently to ship goods: either we go via Suez or we have to circumnavigate Africa'.
