OCTOBER 2010
                                        

China Armco reports financial results for the second quarter

China Armco Metals, Inc., a distributor of imported metal ore and metal recycler in China, announced its financial results for the second quarter of 2010.

Net revenues for the first six months of 2010 were $25.6 million compared to the $27.9 million recorded in the first six months of 2009. The decrease in revenue is largely due to a sharp decline in customer demand midway through the second quarter of 2010 resulting from the Chinese government measures to restrain the real estate industry from overheating. As a result, net revenues for the second quarter of 2010 were $17.0 million compared to the $22.5 million recorded in the second quarter of 2009. In the second quarter China Armco experienced a significant decline in metal ore sales as purchasers curtailed orders in light of these policies.

China Armco recorded a net loss of $248,000 for the second quarter of 2010 compared to a net income of $3.1 million recorded for the second quarter of 2009. This resulted in a loss per diluted share of $0.02 as compared to earnings per diluted share of $0.31 in the second quarter of 2009. The net loss for the first six months of 2010 was $194,408 or $0.02 per diluted share as compared to net income of $3.4 million or $0.34 per diluted share in the first six months of 2009.