Tuesday, September 30, 2014

Armco Metals Holdings, Inc. (AMCO) – From Niche Entity to Diversified Business

Armco Metals, a California-based metal ore distributor and scrap steel recycler focused on China, continues to evolve. Once a foreign company specializing exclusively in metal ore trading, the company is now an international entity with integrated business lines covering the:

•           Import, production, sale, and distribution of processed and non-ferrous metal ores that cater to China’s emerging steel manufacturing industry;

•           Recycling of scrap steel throughout China; and

•           Mostly recently, the sale and supply of wood chips to pulp mills in China.

Armco has grown significantly since it was founded a decade ago. It has strengthened its existing metal sales and distribution business, expanded its scrap steel recycling capacity, and started offering sourcing and pricing services for assorted metals.

The company’s growth has been propelled by many factors—its management team’s direction, a forward-looking operating strategy, widespread industry management experience and deep wisdom and vision. Regardless, the company continues to fine tune its business approach, developing and adopting more efficient methods so that its customers, suppliers, and investors can reap the rewards.

Early in September 2014, Armco branched out into its newest business: the sale and supply of wood chips to paper manufacturers. The company signed an agreement to purchase, in the next month, a trial shipment of Eucalyptus Nitens wood chips weighing approximately 50,000 Green Metric Tons (GMT) from a Chilean supplier. If the trial shipment is successful, Armco would then purchase a full year’s total importation, or approximately 600,000 GMT, which has an estimated market value of $63 million (according to the present market price in China). Should the full purchase occur, Armco hopes to realize a 10% gross margin on the sale of the entire product.

While China is the world’s biggest paper and paperboard producer, there is a noticeable lack of high quality wood fiber supply in the region. As a result, new pulp mills have been looking to expand the importation of wood chips from plantation-rich countries so as to meet their growing needs. Armco is hoping to capitalize on this unmet need by adding the wood chip business to its international trading line.

For more information, visit www.ArmcoMetals.com

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