Lihua breaks ground on second copper recycling facility
Company acquires 50 year land use rights from Jiangsu Provincial Government

Lihua International, Inc., a Chinese developer, designer and manufacturer of alternatives to pure copper products, including refined copper products and superfine and magnet wire, as well copper clad aluminum (CCA) wire, announced that it has broken ground on its second copper recycling facility. The groundbreaking follows Lihua’s acquisition of land use rights from the Jiangsu Provincial government.

The new recycling and smelting facility, which is expected to open during the second half of 2011, is being built on approximately 30 acres of land located adjacent to Lihua’s existing copper recycling facility in Danyang, China.

Based on the company’s construction plan, the facility will initially house two smelters, and will increase Lihua’s annual refined copper production capacity to 100,000 tons from current annual capacity of 50,000 tons. Total costs associated with the new facility, including the acquisition of 50 year land use rights, construction and equipment are expected to total $35 to $40 million. The construction and all associated costs will be fully funded from Lihua’s cash on hand, which totaled $87 million as of June 30, 2010.

“We are pleased to…break ground on our second copper recycling facility, which will provide us with a much needed increase in refinery capacity as we work to keep up with the tremendous demand that exists for our products in the Chinese market,” said Jianhua Zhu, chairman and CEO of Lihua. “We have received 2011 copper anode supply contracts and customer demand indications totaling 110,000 metric tons, which exceeds our estimated refinery capacity for the full year, reinforcing our belief in the sizeable market opportunity that exists for this product and supporting our decision to launch the anode product line during the second quarter of 2010. Demand for our other products remains strong as well, and we believe that this capacity addition will allow Lihua to capture an additional share of the Chinese copper market.”

Zhu added, “Similar to our current facility, this new facility is designed and constructed to meet the most stringent environmental standards, and includes a smoke collection system to filter the exhaust, as well as a water collection system which allows Lihua to recycle the water used for the cooling of molten copper, in addition to a variety of other technologies. Our recycled copper products carry numerous ecological benefits over products made from newly-mined copper.”