LATEST NEWS RELEASE

China Direct Industries Provides Financial Outlook for Fiscal 2010 Ending September 30, 2010

Deerfield Beach, Fla. - China Direct Industries, Inc. ("China Direct Industries") (NASDAQ: CDII), a U.S. owned holding company operating in China in two core business segments, pure magnesium production and distribution of basic materials, announced today its financial outlook for its fiscal 2010 year ending September 30, 2010.

As a result of improved visibility in the operations of its subsidiaries in China, coupled with continued price stabilization and improvement in demand in its magnesium segment, management has decided to reinitiate providing an annual financial outlook. Management sees improvement across all its business areas resulting in revenues for the full fiscal year of 2010 ranging between $130 and $150 million with net income ranging from $8 to $10 million. This guidance is predicated on management's believe that magnesium prices and demand will continue to gradually improve in the fiscal year. Management also believes its consulting operations will improve significantly as global markets continue to strengthen for small to medium sized Chinese entities.

Commenting on its outlook, Dr. James Wang, Chairman and CEO of China Direct Industries, Inc. stated, "We have navigated the company through unprecedented difficulties and have worked diligently to remain in a solid financial position with operations capable of resuming growth when markets improved. We believe that that time is on hand in 2010 and we intend to work diligently on a return to profitability and a resumption of growth for all our businesses in China and the U.S. We are confident in our ability to deliver and optimistic that our end markets will continue to solidify and improve as we move throughout fiscal 2010."

Company Snapshot

China Direct Industries was created in recognition of the market need for both investment capital and management acumen for small to medium sized business entities in the PRC with annual revenues under $100 million. Our mission is to provide a platform to support, develop and nurture these businesses which play a vital role in the ongoing expansion of the Chinese economy. We offer Chinese entities business solutions which foster growth and the ability to compete successfully on a global scale.

China Direct Industries is a holding company operating in two primary business segments: Magnesium and Basic Materials. We also provide advisory services to Chinese companies to assist them in competing in the global economy. As a direct link to China, our organization serves as a vehicle to allow investors to participate directly in the rapid growth of the Chinese economy.

Corporate Profile

China Direct Industries, Inc. ("CDII") is a rapidly growing holding company. Our common stock is listed on the NASDAQ Global Market under the symbol CDII.

We are a U.S. company doing business in China. We acquire controlling interests of Chinese business entities. We are committed to improving the quality and performance of each subsidiaries by providing an array of resources to augment their efficiency and growth. These resources include management advice, investment capital, business development services, strategic planning, internal control, macroeconomic industry analysis, and financial management. Through this ownership control, we provide resources, enabling these subsidiaries to successfully expand their operations.

In addition, we provide consulting services to Chinese entities seeking to compete in a global economy. These services include M&A strategy planning and analysis, financial management, SEC filings, SOX 404 compliance, legal counsel, merger & acquisition, accounting management, etc.

CDII with offices in the United States and China, is comprised of both Chinese and American business professionals eager to develop creative solutions to access the growing Chinese economy. Employing a multicultural team which has been operating successfully within the landscape since 2001, our organization presents a series of advantages critical to the success of Chinese entities.

Why Consider CDII

Strategy

China's development of infrastructure and related construction has been growing rapidly and is expected to continue to grow fueling demand for basic materials. We believe demand will continue to be strong for basic materials, such as industrial chemicals, basic metals and minerals, forestry and wood products, and other basic resources. China Direct Industries has been operating successfully within the landscape since 2001, our organization presents a series of advantages critical to the success of Chinese entities.

Leadership

A significant component of our capabilities lie in the quality of our personnel. Our success in a variety of cross border transactions is proof of our experience. China Direct Industries has been instrumental in guiding our clients through the rigorous process of accessing the U.S. capital markets.

Our organization has the unique ability to provide comprehensive services relevant to conducting business with China. Our knowledge of the innate practices of Chinese commerce blended with our experience within the U.S. capital markets offers a compelling advantage to capitalize on the growth of the Chinese economy.

Our Sino-American team has the critical edge that offers portfolio companies the necessary Chinese investment savvy and international management expertise to facilitate sound investment choices in China.

We seek to help navigate through what are often confusing cultural and legal challenges. Members of our team possess a working knowledge of the unique characteristics of business operations in China. Employing a multicultural team, both in our U.S. and Shanghai offices, our organization presents a series of advantages critical to the success of these Chinese entities.

Consulting Services

We offer a comprehensive suite of services tailored to meet the needs of each individual client. A significant component of our competitive advantage lies in the quality of our personnel. Members of our team possess a working knowledge of the unique characteristics of business operations in China. Our function is to provide the necessary resources for Chinese entities to effectively compete in the global economy.