China Armco Metals, Inc. (CNAM), a distributor of imported metal ore and growing scrap metal recycler, today announced that Armco & Metawise (H.K.), Ltd. (“A&M”), the Company’s wholly owned subsidiary, has established a strategic partnership with TCG Commodity Management, LLC (“TCG”), a leading international market maker supplying high demand minerals and commodities to companies throughout Southeast Asia, to source a number of high demand minerals as part of the Company’s recent strategy to seek longer term supply contracts for distribution in China.
Following TCG’s commitment to sell a total of 800,000 metric tons of Manganese, the two companies began talks to pursue a partnership to secure a number of additional commodities for distribution into China resulting in today’s announcement. Under the framework of this strategic partnership, TCG has agreed to provide A&M preferential access to additional supplies of Manganese as well as Pig Iron and Iron Ore from Brazil, and Coal from Colombia.
Commenting on this partnership, Mr. Kexuan Yao, CEO and Chairman of China Armco Metals, Inc. stated, “There is currently a supply-demand imbalance in China, with many core industrial minerals and metals. While this is largely attributable to China’s strong growth, there are a number of other factors that contribute to this problem including market inefficiencies, differences in business culture and communication challenges. We believe these factors are very prominent in South America where a vast supply of these materials can be sourced into China. This is why we are convinced this partnership opens the door to a very large opportunity for us. First, TCG is unique because it has deep experience in Asia, with a management team that has been financing trades in the Asia region for decades, coupled with an established infrastructure in Brazil. TCG has a wealth of business relationships in Brazil in marketing, banking, and legal and has facilitated billions of dollars worth of international commodities transactions in numerous countries. We know of no other company with this particular balance. Second, TCG has direct access to mines and can enable us to obtain product without having to build our own origination system in South America.”
According to Van Carter, Chairman and CEO of TCG Commodity Management, LLC, “Our initial focus is on Manganese and Pig Iron from Brazil and Coal from Colombia.” He explained that, “This business is dependent upon four factors. First is the ability to bridge the differences in business culture, communication and regulation that exist between China and Brazil. Second is the ability within Brazil, to establish deep personal and professional relationships to secure access to mineral products. Third is the ability to secure favorable pricing and delivery terms, which is a direct function of our access to capital. Through our relationship with A&M, we now have direct access to end-users in China, which is the fourth essential element of a successful business. This is a win-win for both companies.”
TCG Commodity Management, LLC.
TCG Commodity Management is a subsidiary of TCG Worldwide Holdings, LLC. For Asian companies, the sale of Assets to Western companies and investors (or the purchase of Assets from them) can be especially challenging. At TCG, we are experts in these transactions, especially those that involve natural resources. In addition to managing the process, we can also fund the purchase of these Assets, thereby providing the key ingredient to a successful close. TCG has successfully facilitated billions of dollars worth of international commodity transactions for Asian companies. For more information please visit us at www.carteradvisors.com.
About China Armco Metals, Inc.
China Armco Metals, Inc. is engaged in the sale and distribution of metal ore and non-ferrous metals throughout the PRC and has entered the recycling business with the recent launch of operations of a 1-million ton per year shredder and recycler of metals located on 32 acres of land acquired by China Armco. China Armco maintains customers throughout China which includes the fastest growing steel producing mills and foundries in the PRC. Raw materials are supplied from global suppliers in India, Hong Kong, Nigeria, Brazil, Turkey, and the Philippines. China Armco’s product lines include ferrous and non-ferrous ore, iron ore, chrome ore, nickel ore, magnesium, copper ore, manganese ore and steel billet. The recycling facility is expected to be capable of recycling one million metric tons of scrap metal per year which will position China Armco as one of the 10 largest recyclers of scrap metal in China. China Armco estimates the recycled metal market as 70 million metric tons.
Safe Harbor Statement
In connection with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, China Armco Metals, Inc., is hereby providing cautionary statements identifying important factors that could cause our actual results to differ materially from those projected in forward-looking statements (as defined in such act). Any statements that are not historical facts and that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, indicated through the use of words or phrases such as “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimated,” “intends,” “plans,” “believes” and “projects”) may be forward-looking and may involve estimates and uncertainties which could cause actual results to differ materially from those expressed in the forward-looking statements. These statements include, but are not limited to, our guidance and expectations regarding revenues, net income and earnings. In addition, any such statements are qualified in their entirety by reference to, and are accompanied by, the following key factors that have a direct bearing on our results of operations:
We caution that the factors described herein could cause actual results to differ materially from those expressed in any forward-looking statements we make and that investors should not place undue reliance on any such forward-looking statements. Further, any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time, and it is not possible for us to predict all of such factors. Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. This press release is qualified in its entirety by our partner’s ability to complete its obligations to source various minerals and ores within acceptable specifications, demand and fluctuations in the prices of those minerals and ores, our ability to resell any sourced minerals and ores at current market prices and on favorable terms, our ability to finance the purchase price of any minerals and ores, and the cautionary statements and risk factor disclosure contained in our Securities and Exchange Commission filings, including our Annual Report on Form 10-K for the year ended December 31, 2009.
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