Coming into focus
November 01, 1998
by Teresa Acklin
New milling technology driving growth as Braibanti Golfetto seeks dominant role in grain-based foods.
By Morton I. Sosland, Editor-in-chief
At a time when flour mill modernization and new mill building have reached their most active pace in many years, Golfetto, the milling equipment division of Braibanti Golfetto S.p.A., Padova, Italy, has invested heavily in positioning itself as uniquely committed to helping flour millers operate with ever higher levels of efficiency. It has sought to capture a dominant role for itself in grain-based foods by focusing not just on the total industry, but also on particular niches of this fast-growing sector of the food business.
In an interview conducted during this year's convention of the North American Millers' Association in Santa Barbara, California, U.S., Marco Rinaldi, managing director of the Braibanti Golfetto group, joined by Gerald Richardson, president of the Braibanti Group Corp., Millersville, Maryland, U.S., discussed the strategy for the group that has been formulated to assure not just participation in the exciting present of grain-based foods, but also to provide a base for fast growth wherever in the world these trends are favorable.
For Mr. Rinaldi, assuring that Golfetto ranks among the leaders in flour mill building, equipment manufacturing and engineering is a commitment that flows through the entire Braibanti Golfetto organization.
He also underscored his belief in the vitality of the U.S. market, which in his judgment offers greater promise for companies like his to do business than almost any other part of the world. This is especially the case, he said, when it comes to new investment in flour milling.
Golfetto since 1992 has participated in about 40 flour mill projects a year, divided about equally between new mill construction and plant modernization and expansion. About 90% of those projects have been outside Italy and a great number have been in North America.
The United States has a greater potential as a milling engineering and equipment market than even an emerging economy like China, Mr. Rinaldi said.
Some of Golfetto's largest projects have been in the United States, including the 860-tonne Italgrani durum mill in St. Louis, Missouri, which is considered the largest durum mill in the world, and the mammoth 950-tonne modern mill complex owned by Amber Milling Co. in Kenosha, Wisconsin. This year, Golfetto began work on its 18th milling unit in North America in 10 years an 360-tonne flour mill for Dakota Valley Mills L.L.C. in Fairmount, North Dakota.
NEW TECHNOLOGY DRIVING GROWTH.
The attraction for millers to invest in new equipment, Mr. Rinaldi said, has been provided by considerable increases in milling yields that are realized from technology introduced in recent years.
A new mill built today assures not only a 2% to 3% yield increase but also incomparable advantages as to quality and consistency, he said, even considering the more restrictive rules regarding hygiene and sanitation. Moreover, he added, a new mill can operate for 365 days a year, with an efficiency near 100%.
Turning to durum milling, where Golfetto has carved out a special niche and where it has enjoyed considerable success, Mr. Rinaldi described what he viewed as “an unbridgeable economic gulf” between what is achievable with a new durum mill as compared with a durum mill of age.
In extraction alone, the difference is immense, he said. A new mill can produce semolina at about a 73% extraction rate, contrasted with 65% in older plants. “There are also great quality differences,” Mr. Rinaldi said, pointing out that a new durum mill introduces product versatility and possibilities that were unheard of in conventional mills of the fairly recent past.
Mr. Rinaldi proudly noted Braibanti Golfetto's leading role in providing both durum milling and pasta manufacturing equipment for American Italian Pasta Co., Excelsior Springs, Missouri, U.S. Both of AIPC's plants the Excelsior Springs facility, which recently has been doubled in size, and the newly opened plant in Columbia, South Carolina, U.S. have integrated durum milling with pasta manufacturing.
AIPC's durum mill in Columbia is the first such plant in the world to operate its third shift on a “lights out” basis, or without any workers in the plant, he added.
Mr. Rinaldi said it was not likely that such mill-product manufacturing would extend into baking. Baking, he noted, requires a broad quality range of flour for a broad range of products, whereas an integrated durum mill and pasta plant often attains its maximum level of efficiency when the mill is designed to produce only a single grade of semolina. “The explosion in demand for specialty baked goods rules out mill-bakery integration,” he said.
Following the growing demand for specialized baking products, primarily those of ethnic origin, Golfetto has made extensive investments in gaining expertise in automation as well as in flour blending systems. “Yes, we are specialists, in automated milling, in blending, in mixing, in offering millers an ensemble of equipment that we believe will do the best job to help them serve this rapidly changing market,” Mr. Rinaldi declared.
COMMITMENT TO QUALITY.
Citing the “snowball effect” that follows in the wake of new mill projects in an industry as competitive as U.S. milling, Mr. Rinaldi said Golfetto's participation in a wide range of U.S. milling projects was not just a reflection of the group's engineering and manufacturing skills, but also of its absolute commitment “to the highest possible quality at the lowest possible cost.” This quality, he said, includes a commitment to assuring millers of maximum attention to sanitation as well as to systems that minimize maintenance expenses while sharply reducing downtime.
He called attention to “The Miller,” a system developed in 1996 by Golfetto that is in reality a computer that samples the mill flow and automatically sets the rolls to conform with instructions regarding the grade of flour desired. This advanced automation of milling works on a cycle of milling machinery adjustments, he noted.
Mr. Rinaldi said that he does not expect huge changes to occur in the future in how flour is milled, but that instead “the same basic technology will continue for the foreseeable future.” He certainly did not rule out all change.
“Small things happen, and this will be reflected in all the mill's equipment,” he said. “There's no question but that the roller mills and the sifters will become more efficient. The mill of the future will require less energy to operate.”
Mr. Rinaldi also expressed great enthusiasm about the internet and its contribution to milling engineering, regardless of where a project is under way. He estimated that by using the internet to move drawings around the world, costs have been reduced and the building process itself has been speeded up to a significant degree.
“I would estimate that more than 70% of our contract drawings move between the construction site and our engineering headquarters over the internet,” Mr. Rinaldi said. He contrasted the speed that this system has introduced into plant construction and machinery installation with pre-internet processes that often involved days of delay in approving drawings.
Mr. Rinaldi has been at the operating helm of the Braibanti Golfetto group since 1989 when Braibanti, a family-owned manufacturer of pasta-making equipment, joined with Intercoop, an Italian engineering group, to acquire on a 50-50 basis the Golfetto milling engineering business.
Golfetto, founded in 1928, had fallen on hard times, largely because the founding generation tried to operate the company without capital and overlooked the growing international market.
Mr. Rinaldi initially represented Intercoop on Golfetto's board, and quickly perceived the opportunities for joining the business into a single group. This occured in 1996 when the Braibanti family assumed 100% control of the three companies Braibanti, Golfetto and Simer. Mr. Rinaldi was named managing director and the company's headquarters was established in Padova.
Ownership is now totally with the second generation of the Braibanti family in the equipment business, with Ennio Braibanti as chairman and his brother-in-law, Cesare Valletti, as vice-chairman.
The Braibantis bring an unusual perspective to the business. Originally pasta manufacturers with a factory in Parma, the group began developing its own manufacturing equipment. A leaning toward engineering finally prompted the decision made about 20 years ago to sell the pasta side of the group to Barilla, Italy's leading pasta manufacturer, in order to focus exclusively on pasta-making equipment and plant engineering.
Once the dominant company globally in pasta-making equipment, Braibanti lost that position through market share gains by new competitors.
The same enthusiasm reflected by Mr. Rinaldi about flour mill building and engineering ruled in regard to his company's position in providing pasta equipment and pasta manufacturing plants through its Braibanti division. In the pasta-making area, Mr. Rinaldi left no doubt but that he has every intention of trying to regain the No. 1 market share the group once held as a supplier to the pasta industry. He acknowledged that this leadership was lost by the company not reacting swiftly and strongly enough when new competitors appeared.
The smallest of the group's divisions in grain-based foods is Simer, an Italian manufacturer of equipment for baking “anything that is not a pan loaf,” Mr. Rinaldi explained, once again defining the specialty aspects of the group. He described how Simer had carved out a special niche in making baking equipment to produce specific products, such as pizza crusts, filled frozen pizza, ciabatta, baguettes and specialty breads made from a continuous dough sheet without any damage to the internal structure of the dough.
The group's focus on this aspect of baking, he said, reflects a belief that this is the direction in which baking is moving toward specialty products that appeal to modern-day consumers looking for different foods. Currently, Simer offers bakers five different production lines for specialty products, and Mr. Rinaldi said he was committed to expanding this range to biscuit and confectionery while still excluding entry into equipment for pan loaf, high-capacity production.
SYNERGIES THROUGH INTEGRATION.
Integrating the three divisions milling, pasta and baking has produced synergies in marketing, engineering, technology and manufacturing, and has improved Braibanti Golfetto's purchasing power, reduced costs and improved company performance, Mr. Rinaldi said.
Since 1989, Braibanti Golfetto has been growing at a rate of about 20% per year. The current combined turnover is U.S.$140 million, of which Golfetto accounts for about $84 million; Braibanti, $39 million; and Simer, $17 million.
Mr. Rinaldi pointed out that Golfetto, where he has primarily been involved, has grown to its present volume from hardly a U.S.$10 million annual rate in 1989. On the other hand, Braibanti nine years ago was doing an annual business on the order of U.S.$70 million, highlighted by building in one year 16 new pasta-making lines in the United States, but that volume has fallen recently.
The Simer business a decade ago was “very small in a huge market,” Mr. Rinaldi said, “and we look for it to grow, particularly in the U.S. market.” He attributed the recent rapid growth to “several huge projects in Russia,” as well as the decision of the Braibanti family to reinvest in the business and not take dividends.
Braibanti Golfetto has a staff of nearly 600, of whom 130 are engineers. About a third of the engineers are general engineers, another third are in flour milling, and the balance are in pasta and baking.
In addition to the Millersville, Maryland, headquarters of the Braibanti Group Corp., offices and spare parts depots are maintained in Moscow; Kuala Lumpur; Beijing; Puebla, Mexico; and Caracas, Venezuela.
Considerable rationalization of the group's equipment making has been carried out under Mr. Rinaldi's direction. Padova continues to be the headquarters for milling equipment. The facility in Padova has been enlarged and renovated in order to house the entire Braibanti Golfetto group.
Most of the baking and pasta equipment manufacturing, as well as a new research and development center, has been located in Rovereto, about 150 kilometers from Padova. Mr. Rinaldi estimated that the group had invested $20 million in recent years in expanding the manufacturing and research facilities in Rovereto.
Mr. Rinaldi noted how manufacturing decisions by both Golfetto and Braibanti led to the creation of new competitors. In Golfetto's case, a decision to stop buying foundry products from Sangati and make its own prompted Sangati to enter into the milling equipment business. Similarly, a decision by Braibanti to make its own dryers instead of buying from Fava meant that the latter company is now a competitor in pasta-making equipment.
In looking to Braibanti Golfetto's future, Mr. Rinaldi said he did not expect the 20% annual growth rate of the past decade to continue. “Instead,” he said, “we need to focus on consolidating our business and in making sure that we are prepared to serve our clients throughout the world.
“It's our expectation that the milling equipment business will be fairly evenly divided around the world in five ways Europe, North America, the Mediterranean area, Russia and eastern Europe, and Asia, including China. We will be very happy if that balance is maintained, even though the U.S. market presents the most complex situation and the greatest opportunities and also is the place where the greatest change could occur.”