Tuesday, April 29, 2014

Armco Metals Holdings, Inc. (AMCO) On Pace with Growing “Green” Initiatives of Chinese Government

Since the Chinese government’s introduction of economic reforms in 1979, the Chinese economy has been growing like clockwork. The National Bureau of Statistics reports that from 1979 to 2012, China saw its economy grow on average by 9.8 percent per year. Average world economic growth, in comparison, was only 2.8 percent per year in that stretch of time.

Foreign nations’ reactions to these statistics have varied because of the Chinese government’s exchange rate policy. However, it is clear that China has emerged as a strong economic force to be reckoned with. Over approximately 35 years, the Chinese economy has jumped from the world’s tenth largest economy to the world’s second largest, behind the United States. And aggressive initiatives set by the Chinese government are in line with that trend. In the area of “green” initiatives, the Chinese government has been pushing for alternative, sustainable options for steel production. At present, China contributes a significant portion to global steel production. A Reuters article published in January 2014 notes that Chinese steel production accounts for almost half of global steel production output.

Specifically, the Chinese government is pushing for consumption of recycled scrap steel to increase from 15 percent in 2010 to 20 percent by 2015. But at present, it is reported that the fragment recycling industry in China is capable of meeting only 60 percent of that green initiative’s demand.

Recognizing the growing needs of China’s steel production industry, Armco Metals Holdings has stepped in as a provider of metal and non-ferrous metal ore sales and distribution solutions to companies in this space for over 10 years. In that time, Armco Metals Holdings has emerged as one of China’s leading metal recycling and metal distribution companies. The company’s emergence as an industry leader is strongly attributable to the company’s senior leadership, Mr. Kexuan Yao, and his business savvy and expertise. Under Mr. Yao’s leadership, Armco Metals Holdings has seen a surge in its company growth over the past seven years. Subsequently, it has moved from being a foreign enterprise with a specialization in metal ore trading to an international corporate body with integrated business activities in import, production, sales, and distribution operations.

On the sales side, Armco Metals Holdings has developed sales relationships with over 100 small-to-medium enterprises involved in metal manufacturing and over 10 international metal suppliers from countries including South Korea, India, Australia, and Brazil. For its business operations, the company works through five subsidiaries: Armco (Lianyungang) Renewable Metals, Inc.; Armet (Lianyungang) Holdings, Inc.; Armco Metals International, Ltd.; Henan Armco & Metawise Trading Co., Ltd.; and Armco Metals (Shanghai) Holding, Ltd. Armco (Lianyungang) Renewable Metals, Inc. remains the company’s core business asset.

In its financial results for Q4 2013, company revenue surged 74 percent to $66.2 million from Q4 2012’s revenue amount. The improved performance was attributed to the company’s strong metal trading performance. In 2014 Armco Metals Holdings has also been focusing on expanding its foreign market reach. Recently it announced its stock purchase agreement with California-based Draco Resources, a company that focuses on exploration, mining, and trading of iron ore and minerals. With due diligence and other conditions satisfied, Armco Metals Holdings will benefit from Draco Resources’ exclusive rights of management, operation, distribution, and sale of approximately five million metric tons of iron ore fine in the state of Alabama.

For more information about Armco Metals Holdings and its initiatives, please visit: www.armcometals.com

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