Portion of Proceeds to Fund Magnesium Refining Acquisition in China BOCA RATON, Fla., July 16 /PRNewswire-FirstCall/ -- China Direct, Inc. (OTC BB: CHND), a company maintaining active, majority stakes in a diversified portfolio of Chinese companies as well as offering consulting services for both private and publicly traded Chinese entities, announced today that the Company received $4,282,500 from the exercise of 1,427,500 of its Class B warrants pursuant to a special offer made by the company on July 9, 2007. The maximum amount of warrants eligible in the offer were exercised in a 3 day period. The company intends to use $3.35 million of the proceeds to complete the funding of its recently announced acquisition of 52% of Shanxi Jinwei Magnesium Company, Limited ("Jinwei"). Upon completion of the first stage of construction, slated for September of this year, Jinwei will have a production capacity of 12,000 tons of pure magnesium annually. The second stage of construction, will add an additional facility capable of producing an additional 8,000 tons of magnesium per year. It is estimated that Jinwei, when completed, will generate $45 to $55 million in annual sales capacity based on current magnesium price levels. The remaining proceeds coupled with cash flow generated in our operations will be used for working capital and to fund future acquisition opportunities as they arise. Marc Siegel, President of China Direct, commented, "This warrant exercise was a significant component to our company's expansion plans and we would like to thank our warrant holders for their belief in our company's strategic plan. The acquisition of Jinwei solidifies China Direct's position as a world leader in the production and distribution of pure magnesium. Additionally, these funds will enable us to maintain our opportunistic approach in making accretive acquisitions in China. We are pleased with the strong foundation we have created for continued growth as we position the company for 2008 and beyond." About China Direct, Inc. China Direct, Inc. (OTCBB: CHND) maintains active, majority stakes in a diversified portfolio of Chinese companies as well as offering consulting services for both private and publicly traded Chinese entities. China Direct provides a platform to develop and nurture these entities as they expand their businesses globally. As your direct link to China, our Company serves as a vehicle to allow investors to directly participate in the rapid growth of Chinese economy in a diversified and balanced way. For more information about China Direct, please visit http://www.cdii.net/. Safe Harbor Statement This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward- looking statements are based on current expectations or beliefs, including, but not limited to, statements concerning the Company's operations, financial performance and, condition. For this purpose, statements that are not statements of historical fact may be deemed to be forward-looking statements. The Company cautions that these statements by their nature involve risks and uncertainties, and actual results may differ materially depending on a variety of important factors, including, but not limited to, the impact of competitive products, pricing and new technology; changes in consumer preferences and tastes; and effectiveness of marketing; changes in laws and regulations; fluctuations in costs of production, and other factors as those discussed in the Company's reports filed with the Securities and Exchange Commission from time to time. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof. DATASOURCE: China Direct, Inc. CONTACT: Investor Relations: Alan Sheinwald, Partner, HC International, Inc., +1-914-669-0222, ; or Richard Galterio, Executive Vice President, China Direct, Inc., 1-877-China-57, Web site: http://www.cdii.net/

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