Friday, May 16, 2014

Armco Metals Holdings, Inc. (AMCO) Inks Scrap Steel Distribution Agreement with TEWOO Metals

Armco Metals Holdings, a distributor of imported metal ores and a steel recycler in China, announced today that its Armco (Lianyungang) Renewable Metals, Inc. subsidiary has entered into a steel scrap distribution contract with TEWOO Metals International Trade Co., Ltd. TEWOO Metals is the largest state-owned enterprise in Tianjin that engages in domestic and international trading, distribution, machining, delivery and E-commerce of metals and industrial commodities.

With registered capital of 700 million RMB, TEWOO Metals was established in May, 2006 through the merger of three companies; Tianjin Metal Material Company, Tianjin Xiantong Material & Trade Co. Ltd., and Tianjin Hopetone Co., Ltd. For fiscal year 2013, TEWOO Metals’ total sales revenue was approximately RMB 35 billion and its total sales volume in steel was approximately 14.2 million metric tons.

With the agreement, Renewable Metals will serve as a vendor to source, process, and distribute steel scrap from TEWOO Metals. The first shipment from TEWOO Metals will account for 2,000 metric tons. Armco Metals Holdings sees this agreement as one which will help strengthen the business relationship between the two companies. Additionally, the contract will increase processing capabilities and profit margin through mutually beneficial purchase and payment terms.

Kexuan Yao, Chairman and CEO of Armco Metals, said, “We are excited to work with TEWOO Metals through this new distribution agreement. Since 2014, Armco Metals Holdings has entered into supply agreements with industry leaders such as Mitsui & Co., Ltd., and Midland Resources (China) Company Limited under our ‘platform strategy’ where much of the costs are absorbed by the purchaser with our company receiving more stable and predictable processing fees. This agreement with TEWOO Metals enables us to better manage materials purchasing with a trusted partner on what we believe are very favorable payment terms to help us further leverage our cash to increase volumes and profitability. We believe this type of partnership, coupled with our platform strategy, will allow us to make further inroads to achieving long-term business growth and success.”

For more information about the company visit www.armcometals.com

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