CDII Trading, Inc. in Contract to Supply Manganese Ore to a Manganese Trading and Refining Company in China
2010-05-14
China Direct Industries, Inc. ("China Direct Industries") (CDII 1.35, +0.02, +1.50%), a U.S. owned holding company operating in China in two core business segments, pure magnesium production and distribution of basic materials, announced today that its wholly owned subsidiary, CDII Trading, Inc. ("CDII Trading"), has entered into a contract to supply manganese ore over the next 12 months to a privately held China-based trading and refining company.
CDII Trading expects to supply manganese ore to its China-based buyer to be obtained under a signed purchase agreement with a Chilean mining company over a twelve-month period. CDII Trading is in the process of finalizing financing for its supplier to produce the required quantity of ore to fulfill this contract and expects to begin the first shipment in July 2010. Upon successful completion of this shipment, CDII Trading expects to supply additional shipments to its China-based buyer on a monthly basis over a twelve-month period. CDII Trading estimates that the sales contract has the potential to generate up to $18 million in revenue over the course of the twelve-month period.
Commenting on these contracts, Mr. Ross A. Friedman, Vice President of Commercial Trading at CDII Trading, stated, "This agreement to secure the quantity of manganese ore from our Chilean miner is pivotal to our future success. Upon completion of the first shipment and the buyer's approval for future shipments in China, we believe this contract represents a potential long term continuous revenue stream for us. We anticipate it will also set the stage for other similar arrangements for other miners that we are in various stages of negotiations with for numerous ores such as Iron, Chromium and Copper, to name a few. We believe that tapping into the vast mineral reserves in Chile in this fashion will truly be a springboard to a rapid acceleration of growth in our trading operations."
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