UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM l0-QSB



(Mark One)

(X) QUARTERLY REPORT UNDER SECTlON 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2000

( ) TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from______ to_____



Commission File Number 33-18582



ITRONICS INC.

(Exact name of small business issuer as specified in its charter)







TEXAS
                                          
        
75-2198369

(State or other jurisdiction of
                      
(IRS Employer Identification Number)

incorporation or organization)

6490 S. McCarran Blvd., Bldg C-23, Reno, Nevada 89509

(Address of principal executive offices)





Issuer's telephone number, including area code: (775)689-7696



NO CHANGE

Former name, former address and former fiscal, if changes since last
report.

Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been subject to
such filing requirements during the past 90 days. Yes (x) No ( ).



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APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:

As
of July 31, 2000, 73,464,080 shares of common stock were outstanding.

Transitional Small Business Disclosure Format (Check one): Yes ( ) No (X)



2

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ITRONICS INC. AND SUBSIDIARIES

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION



Item 1. Financial Statements

Condensed Consolidated Balance Sheets  June 30, 2000 and December 31, 1999
               4

Condensed Consolidated Statements of Operations and Comprehensive Income

for the Three and Six Months Ended June 30, 2000 and 1999.
                             
6

Condensed Consolidated Statements of Cash Flows for the Six Months

Ended June 30, 2000 and 1999.
                                          
                
7

Notes to Condensed Consolidated Financial Statements
                                     
8



Item 2. Management's Discussion and Analysis or Plan of Operation
                       
10



PART II- OTHER INFORMATION

Item 1. Legal Proceedings
                                          
                     
14

Item 2. Changes in Securities and Use of Proceeds
                                       
15

Item 6. Exhibits and Reports on Form 8-K
                                          
      
15



3

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PART I - FINANCIAL INFORMATIONON

Item 1. Financial Statements



ITRONICS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

JUNE 30, 2000 AND DECEMBER 31, 1999

(UNAUDITED)

ASSETS

June 30, 2000
    Dec. 31, 1999CURRENT ASSETSCash
    $1,326,643
    $ 142,287Accounts receivable
    197,677
    225,089Account receivable, equipment financing
    2,733
    133,669Note receivable, subscriptions of stock
    9,849
    13,591Inventories
    278,733
    54,981Deferred loan fees, current portion
    14,307
    7,923Prepaid expenses
    155,739
    94,669Total Current Assets
    1,985,681
    672,209PROPERTY AND EQUIPMENTLand
    215,000
    215,000Building and improvements
    977,010
    787,526Plant design/construction in progress
    32,499
    681,225Leasehold improvements
    900
    14,212Equipment and furniture
    1,455,152
    433,316Vehicles
    98,437
    69,155Equipment under capital lease
    844,539
    803,5553,623,537
    3,003,989Less: Accumulated depreciation and amortization
    382,862
    336,3263,240,675
    2,667,663OTHER ASSETSIntangibles
    66,246
    71,219Marketable securities, available for sale
    239,852
    165,660Investment in non-public company
    30,000
    30,000Deferred loan fees, less current portion
    50,313
    31,694Investment in American Gold & Silver Ltd.
    9,250
    9,250Deposits
    45,001
    29,647440,662
    337,470$5,667,018
    $3,677,342


See Notes to Condensed Consolidated Financial Statements



4

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ITRONICS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

JUNE 30, 2000 AND DECEMBER 31, 1999

(UNAUDITED)

LIABILITIES AND STOCKHOLDERS' EQUITY

June 30, 2000
    Dec. 31, 1999CURRENT LIABILITIESAccounts payable
    $ 424,382
    $ 382,882Accrued management salaries
    12,068
    15,513Accrued expenses
    115,262
    88,491Insurance contracts payable
    28,478
    16,127Interest payable
    9,207
    12,490Current maturities of long-term debt and leases
    193,200
    162,855Current maturities of advances and leases fromstockholders
    17,209
    35,785Other
    13,931
    13,131Total Current Liabilities
    813,737
    727,274LONG-TERM LIABILITIESLong-term debt and leases, less currentmaturities
    881,552
    777,960Convertible promissory notes
    2,668,000
    100,000Accrued interest, convertible notes
    100,805
    -Accrued salary due stockholder
    25,854
    29,454Deferred gain, less current maturities
    29,043
    34,209Total Long-Term Liabilities
    3,705,254
    941,6234,518,991
    1,668,897STOCKHOLDERS' EQUITYPreferred stock (-0- shares outstanding)
    -
    -Common stock (73,391,613 shares outstanding atJune 30, 2000 and 70,828,231 outstanding atDecember 31, 1999)
    73,392
    70,828Additional paid-in capital
    9,130,862
    8,013,746Accumulated deficit
    (8,091,654)
    (6,276,762)Common stock to be issued
    89,141
    104,061Accumulated other comprehensive income
    (37,362)
    92,799Common stock options outstanding, net
    (16,352)
    3,7731,148,027
    2,008,445$5,667,018
    $3,677,342




See Notes to Condensed Consolidated Financial Statements



5

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ITRONICS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND

COMPREHENSIVE INCOME

FOR THE THREE AND SIX MONTHS ENDED JUNE 30,2000 AND 1999

(UNAUDITED)

Three Months Ended June 30,
    Six Months Ended June 30,2000
    1999
    2000
    1999REVENUESFertilizer
    $ 49,905
    $ 21,428
    $ 61,280
    $ 33,609Photobyproduct recycling
    46,011
    31,580
    92,854
    59,535Silver
    15,904
    49,910
    50,496
    70,944Mining technical services
    138,956
    88,977
    327,784
    159,290Total Revenues
    250,776
    191,895
    532,414
    323,378COST OF SALES
    287,225
    246,252
    618,878
    451,065Gross Profit
    (36,449)
    (54,357)
    (86,464)
    (127,687)OPERATING EXPENSESDepreciation and amort.
    44,668
    19,527
    72,883
    34,176Research and development
    11,668
    13,111
    24,727
    26,148Sales and marketing
    531,824
    191,748
    969,391
    376,554Plant start-up costs
    64,009
    3,885
    121,491
    26,706General and admin.
    236,804
    145,146
    432,012
    258,542888,973
    373,417
    1,620,504
    722,126Operating Income
    (Loss)
    (925,422)
    (427,774)
    (1,706,968)
    (849,813)OTHER INCOME (EXPENSE)Interest expense
    (109,586)
    (22,539)
    (154,146)
    (38,174)Interest income
    24,866
    6,466
    46,222
    7,648Total Other Income (Expense)
    (84,720)
    (16,073)
    (107,924)
    (30,526)Income (Loss) before provision for income taxes
    (1,010,142)
    (443,847)
    (1,814,892)
    (880,339)Provision for income taxes
    -
    -
    -
    -Net Income (loss)
    (1,010,142)
    (443,847)
    (1,814,892)
    (880,339)Other comprehensive incomeUnrealized gains (losses) on securities
    (133,033)
    4,638
    (130,161)
    4,638Comprehensive Loss
    $(1,143,175)
    $(439,209)
    $(1,945,053)
    $(875,701)Weighted average number of sharesoutstanding (1,000's)
    73,277
    66,172
    72,543
    61,985Earnings (loss) per share
    $(0.0138)
    $(0.0067)
    $(0.0250)
    $(0.0142)


See Notes to Condensed Consolidated Financial Statements

6

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ITRONICS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30,2000 AND 1999

(UNAUDITED)



Six Months Ended June 30,2000
    1999CASH FLOWS FROM (FOR) OPERATING ACTIVITIESNet income (loss)
    $(1,814,892)
    $(880,339)Adjustments to reconcile net income (loss)to cash used by operations:Depreciation and amortization
    72,883
    34,176Interest on convertible notes
    100,805
    -Option compensation
    14,928
    -Bad debts
    2,073
    -Other
    4,516
    -Expenses paid with issuance of common stock
    488,251
    97,914(Increase) decrease:Trade receivables
    25,339
    (4,394)Interest receivable-stock subscription
    -
    917Inventories
    (223,752)
    (5,533)Prepaid expenses
    (31,428)
    (40,607)Deposits
    (15,354)
    (11,532)Increase (decrease):Accounts payable
    41,962
    (42,800)Accrued expenses and contracts
    32,877
    (84,955)Accrued interest
    (
    3,283)
    (
    7,970)Net Cash Used by Operating Activities
    (1,305,075)
    (945,123)CASH FLOWS FROM (FOR) INVESTING ACTIVITIESAcquisition of property and equipment
    (609,974)
    (455,852)Acquisition of marketable securities
    (204,353)
    (12,158)Acquisition of intangibles
    (1,518)
    (27,250)Net Cash Used by Investing Activities
    (815,845)
    (495,260)CASH FLOWS FROM (FOR) FINANCING ACTIVITIESProceeds from sale of common stock
    553,281
    1,847,839Proceeds from debt
    2,883,000
    40,000Payments on debt
    (131,005)
    (108,384)Net Cash Provided by Financing Activities
    3,305,276
    1,779,455Net Increase (Decrease) in Cash
    1,184,356
    339,072Cash, beginning of period
    142,287
    348,829Cash, end of period
    $1,326,643
    $
    687,901




See Notes to Condensed Consolidated Financial Statements

7

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ITRONICS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2000

(UNAUDITED)



1. The unaudited condensed consolidated financial statements printed
herein have been prepared in accordance with the instructions to Form 10-QSB and do not
include all of the information and disclosures required by generally accepted accounting
principles. Therefore, these financial statements should be read in conjunction with the
consolidated financial statements and related footnotes included in the Company's Form
10-KSB for the year ended December 31, 1999. These financial statements reflect all
adjustments that are, in the opinion of management, necessary to fairly state the results
for the interim periods reported.

2. The results of operations for the three and six months ended June
30, 2000 are not necessarily indicative of the results to be expected for the full year.

3.

New lease financing on plant equipment during the first quarter
amounted to approximately $206,000, of which $174,000 was received in cash. In addition,
the purchase of a new service truck was financed with a promissory note amounting to
approximately $30,400.



4. Following is financial information for each of the Companys
segments. No changes have occurred in the basis of segmentation since December 31, 1999.

Reconciliation of segment revenues and operating income (loss) to the
respective consolidated amounts and to consolidated income (loss) before taxes:

Three Months Ended June 30,
    Six Months Ended June 30,2000
    1999
    2000
    1999Revenues:Photobyproduct Fertilizer
    $ 111,820
    $ 102,918
    $ 204,630
    $ 164,088Mining Technical Services
    138,956
    88,977
    327,784
    159,290Consolidated Revenues
    $ 250,776
    $ 191,895
    $ 532,414
    $ 323,378Operating Income (Loss):Photobyproduct Fertilizer
    $(816,329)
    $(368,796)
    $(1,504,836)
    $(692,526)Mining Technical Services
    (109,093)
    ( 58,978)
    (202,132)
    (157,287)Consolidated Operating Income (Loss)
    (925,422)
    (427,774)
    $(1,706,968)
    (849,813)Other Income (Expense)
    (84,720)
    ( 16,073)
    (107,924)
    (30,526)Consolidated Net Income(Loss) before taxes
    $(1,010,142)
    $(443,847)
    $(1,814,892)
    $(880,339)




8

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ITRONICS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2000

(UNAUDITED)

Identifiable assets by business segment for the major asset
classifications and reconciliation to total consolidated assets:

June 30,
    December 31,2000
    1999Current Assets:Photobyproduct Fertilizer
    $ 718,171
    $ 261,740Mining Technical Services
    327,164
    233,8221,045,335
    495,562Property and Equipment, net:Photobyproduct Fertilizer
    2,856,073
    2,432,872Mining Technical Services
    384,602
    234,7913,240,675
    2,667,663Other Assets, net:Photobyproduct Fertilizer
    53,181
    45,434Mining Technical Services
    2,120,836
    2,926,2062,174,017
    2,971,640Total Assets:Photobyproduct Fertilizer
    3,627,425
    2,740,046Mining Technical Services
    2,832,602
    3,394,819Total Segment Assets
    6,460,027
    6,134,865Itronics Inc. assets
    12,441,760
    9,528,737Less: intercompany elimination
    (13,234,769)
    (11,986,260)Consolidated Assets
    $5,667,018
    $ 3,677,342




9

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Item 2. Management's Discussion and Analysis or Plan of Operations

I. Results of Operations

The Company reported a net loss of $1,010,142 or $0.0138 per share for
the quarter ended June 30, 2000, compared to a net loss of $443,847 or $0.0067 per share
for the comparable 1999 period. For the first six months of 2000 the loss was $1,814,892
or $0.0250 per share, compared to a loss of $880,339 or $0.0142 per share for the 1999
comparable period. The primary factor contributing to the increased loss for the quarter
was increased operating costs of $515,600. The increased operating costs are due primarily
due to increased corporate and product marketing and administration costs for financial
management. The purpose of the substantial change in cost structure is to convert the
photobyproduct fertilizer segment from a small scale semi-works operation to full
commercial scale operation. Management focus is now on expanding sales. Sales and
marketing expenses increased by $340,100 over the 1999 second quarter. Additionally,
general and administration costs increased by $91,700 and plant moving and start-up costs
increased $60,100. General and administration costs increased primarily due to additional
management personnel and related costs. The plant moving and start-up costs are discussed
more fully below.

To provide a more complete understanding of the factors contributing to
the changes in sales, operating expenses and the resultant operating loss, the discussion
presented below is separated into the Company's two operating segments.

PHOTOBYPRODUCT FERTILIZER

This segment, managed by Itronics Metallurgical, Inc., operates a
photobyproduct recycling plant, which includes related silver recovery. As part of the
recycling process, the Company manufactures and markets a line of liquid fertilizer
products which are being introduced into the markets in California, Nevada, Oregon, and
Hawaii. Revenues are generated from photobyproduct management services, silver sales, and
fertilizer sales.

____________________________________________________________________________________________________________

Three Months Ended June 30,
    Six Months Ended June 30,2000
    1999
    2000
    1999Sales revenue
    $  111,820
    $  102,918
    $    204,630
    $  164,088Operating income (loss)
    $(816,329)
    $(368,796)
    $(1,504,836)
    $(692,526)




____________________________________________________________________________________________________________





Total segment sales for the second quarter of 2000 were approximately
$111,800, compared to $102,900 for the comparable quarter of 1999, an increase of 8.6%.
Fertilizer sales for the quarter were approximately $49,900, compared to $21,400 for the
1999 second quarter, an increase of 133%. Photobyproduct recycling revenue for the quarter
increased by $14,400 on an increased volume of 44%, compared to the second quarter of
1999. Silver sales decreased $34,000 from the second quarter of 1999, a decrease of 68%.
Silver sales for the quarter do not include any sales of refined silver from the
Companys refinery due to the Chapter 11 bankruptcy filing of Handy & Harman
Refining Group, Inc. The status of silver refining is more fully discussed under new
developments. Cost of sales for the second quarter of 2000 decreased $4,500 from the 1999
second quarter. The decrease was due to a reduction in combined direct material costs
resulting from decreased silver sales. These factors resulted in a gross loss of $59,000
for the second quarter of 2000, compared to a gross loss of $72,400 for the second quarter
of 1999.



10

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Segment operating expenses increased approximately $460,900 over the
second quarter of 1999, due to increases of $308,400 in sales and marketing, $70,700 in
general and administration, $60,100 in plant start-up costs, and $23,100 in depreciation.
The increase in sales and marketing reflects expenditures for corporate marketing, product
advertising and brand name establishment, expansion of the fertilizer sales department,
greater participation in industry trade shows, and the ongoing introduction of Goldn
Gro fertilizer products to the Western Farm Services sales force in California and
expansion of the Goldn Gro fertilizer sales program in Northern Nevada. The plant
moving and start-up costs relate to moving equipment from the pilot plant to the new
manufacturing facility and completion of the clean-up of the pilot plant. In addition,
management determined that future management of manufacturing and Company administration
functions required the acquisition of Enterprise Resource Planning (ERP) computer software
and related hardware upgrades. A software package that specializes in managing a
"process flow" type of manufacturing was acquired late in the first quarter. The
software was operational in early July 2000. The costs related to training personnel in
the operation of the ERP system and to convert data from the previous system are being
charged to plant start-up costs. Final implementation costs of the ERP system will be
ongoing into the third quarter.

These factors resulted in a 2000 second quarter segment operating loss
of $816,300, compared to a loss of $368,800 for the second quarter of 1999, an increased
operating loss of $447,500.

For the first six months of 2000 segment sales totaled $204,600,
compared to $164,100 for the first six months of 1999, an increase of 25%. Operating loss
for the first six months of 2000 was approximately $1,504,800 compared to $692,500 for the
first six months of 1999. The primary factor contributing to the larger loss was increased
operating costs related to converting the segment from an R&D stage to a commercial
stage.





MINING TECHNICAL SERVICES

This segment, known as Whitney & Whitney, Inc., provides mining and
materials management, geology, engineering and economics consulting, and publishes
specialized mineral economics and materials financial reports. It employs technical
specialists with expertise in the areas of mining, geology, mining engineering, mineral
economics, materials processing and technology development. Technical services have been
provided to many of the leading U.S. and foreign mining companies, several public
utilities with mineral interests, to various state agencies, the U.S. and foreign
governments, and the United Nations and the World Bank.

_________________________________________________________________________________________________________

Three Months Ended June 30,
    Six Months Ended June 30,2000
    1999
    2000
    1999Sales revenue
    $ 138,956
    $ 88,977
    $ 327,784
    $ 159,290Operating income (loss)
    $(109,083)
    $(58,978)
    $(202,132)
    $(157,287)




_________________________________________________________________________________________________________



Mining technical services revenue was approximately $139,000 for the
quarter ended June 30, 2000, compared to $89,000 for the comparable quarter of 1999, an
increase of $50,000, or 56%. The sales increase reflects the addition of a new gold mining
exploration client late in the first quarter of 1999, increased activity on ongoing mining
technical services projects, and the completion of two small projects in industries
unrelated to mining. One of the projects was for a photo finishing company and the other
was a chemical analysis project. Although the gold market remains depressed, the new
mining client has the potential to develop into a significant long term client
relationship. Cost of sales increased by $45,400, due to an increase of $41,200 in
pass-through costs. These factors resulted in a gross profit for the segment of $22,500
compared to $18,000 for the prior year second quarter.



11

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Segment operating expenses increased by $54,600 due primarily to
increases of $31,600 in sales and marketing costs and $21,000 in general and
administrative costs. The increase in sales and marketing expense reflects both the
allocable portion of increased corporate marketing and increased efforts in marketing
technical services.

The combination of these factors resulted in a 2000 second quarter
segment operating loss of $109,100, compared to a loss of $59,000 for the second quarter
of 1999, an increased operating loss of $50,100.

For the first six months of 2000, segment revenue totaled $327,800
compared to $159,300 for the first six months of 1999, an increase of 106%. Operating loss
for the period was $202,100 compared to an operating loss of $157,300 for the comparable
1999 period. The primary factor contributing to the decline was increased expenditures for
marketing and financial management.

SUMMARY

On a consolidated basis, the various changes in revenues and operating
expenses resulted in a second quarter 2000 operating loss of $925,400 compared to an
operating loss of $427,800 for the second quarter of 1999, an increased loss of $497,600
Consolidated operating loss for the first six months of 2000 was $1,707,000 compared to
$849,800 for the first six months of 1999.



II. Changes in Financial Condition; Capitalization

Cash amounted to $1,326,643 as of June 30, 2000, compared to $687,901
as of June 30, 1999. Net cash used for operating activities was approximately $1,305,100
for the first six months of 2000. The cash used for operating activities during the period
was financed primarily by the private placement of $2.6 million in proceeds from 9%
convertible promissory notes. A total of $610,000 was invested in property and equipment
during the period, primarily for completion of the manufacturing facility and for computer
hardware and software. Approximately $204,400 was invested in marketable securities. The
majority of this investment was for acquiring 5.2% of Verdant Brands, Inc. This investment
is more fully discussed under new developments. The value of these investments was reduced
by $133,000 during the quarter due to declines in the stock price for both Golden Phoenix
Minerals, Inc. (GPXM) and Verdant. It appears that GPXMs price declined due to a
sell-off after the price nearly doubled in value during the first quarter from its
December 1999 price. As a penny stock, such volatility is not unusual and the price is
expected to rebound as the company moves forward with its plans. Verdants price
declined during the period Whitney & Whitney, Inc. was acquiring the Verdant shares.
While the price decline has resulted in an unrealized loss on the investment, it was
beneficial in that the objective of acquiring more than 5% of Verdant was reached at
substantially less cost than was anticipated.

Total assets increased during the six months ended June 30, 2000 by
approximately $1,990,000 to $5,667,000. Current assets increased approximately $1,313,500
due to increases in cash of $1,184,400, inventory of $223,800, and prepaid expenses of
$61,100. These increases were partially offset by decreases of $27,400 in accounts
receivable and $130,900 in receivable from equipment financing. The increase in inventory
is due to a build-up of silver products in anticipation of future sales and to the lack of
sales of refined products related to the H&H problem discussed above. The increase in
prepaid expenses is due primarily to consulting expenses that are paid quarterly in
advance. Much of these expenses are stock based and consequently, the value of the
expenses has increased substantially, in proportion to the rise of the Companys
stock price during the first quarter.



12

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Current liabilities increased by approximately $86,500 and total
liabilities increased by $2,850,100. The increase to total liabilities is related
primarily to the private placement of $2.6 million of 9% convertible notes as discussed
above and lease financing of $206,000 in equipment, which was partially offset by debt
payments of $131,000.



III. Working Capital/Liquidity

During the six months ended June 30, 2000, working capital improved by
approximately $1,227,000 to $1,172,000. Management has continued the Company's ongoing
program of improving working capital and liquidity through exercise of warrants and
payment of consulting and other labor services with common shares. In addition, a private
placement of $2.6 million of 9% convertible promissory notes was completed during the
first quarter. During the six months ended June 30, 2000, a total of $553,300 was received
from the exercise of warrants and options and approximately $488,300 in various expenses
were paid with common shares.

The Company is presently reviewing available alternatives for raising
from $5 to $15 million in equity funds over the next two years. These funds will be used
to meet working capital requirements and for planned acquisitions.

IV. New Developments





The University of California at Davis has agreed to continue an
expanded nutrition evaluation program for diseased wine grapes. Protocols and products
that are to be used have been provided by the Company. The results of the 1999 test
applications were positive and the information has been used to revise the Goldn Gro
product application parameters for wine grapes. This application program is now being
evaluated in the central coast area and is being introduced to the wine grape growers in
that area of California.

Research to develop an application for citrus has been underway for
several years and a set of foliar application products and parameters have now been
developed. These product applications were tested on lemon and valencia orange trees in
April with positive results. An application demonstration program is now underway in
southern California and is expected to be on-going for one or more years. A second
application demonstration program is being developed with a large southern California
citrus grower and the University of California at Riverside. This program will be a
multi-year program and is being planned to launch in the fourth quarter of this year.
Research conducted by the University of California at Riverside has shown that both the
quantity and quality of oranges can be increased with the use of foliar applied lo-biuret
urea at appropriate times during the year. This information has been used to develop the
Goldn Gro application program for citrus.



13

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Planning is underway to expand on site tank storage for finished liquid
fertilizer products and a tank truck loading and unloading facility. The Company is also
developing a consumer sales product plan and is planning to install a small packaging line
to package the consumer products. This is being planned for completion in the first
quarter of next year.

The Company had originally planned to expand the refining operations
once the plant was operational. The bankruptcy of H & H has caused the Company to
implement this expansion sooner than was originally planned. The new silver refining
process produces high purity silver bullion and reduces the cost of silver refining by
more than 50%. A replacement refining and sales agent has been found and silver bullion
shipments began in the third quarter.

During the quarter the Company initiated its acquisition program by
entering into discussions with companies that it has identified which will, if acquired,
accelerate the companys internal product sales growth. Future acquisitions are
planned to acquire market access to expand fertilizer sales and to expand photochemical
handling services. The types of companies being considered are either fertilizer marketing
companies or photochemical service companies. The acquisition program is being focused to
speed up the companys geographic expansion and the rate of market penetration.
Presently the Company does not have funding specifically allocated to make acquisitions,
which is the reason for the previously stated goal of raising an additional $5 million to
$15 million over the next 2 years. The Company is also seeking funding that will be used
to expand the new Stead manufacturing plant. The first expansion, which is now being
planned, is expected to require between $1 million and $1.5 million to complete.

In late July the Companys subsidiary, Whitney & Whitney, Inc.
(WWI), completed the acquisition of a 5.2% interest in Verdant Brands, Inc., a publicly
traded company that is listed on the Nasdaq National Market System (Verdant)(NASDAQ:VERD),
as a strategic investment. Verdant is a leading fertilizer marketing company and is a
developer, manufacturer and supplier of pest control products and fertilizers to the
retail, agricultural and professional markets utilizing a variety of national, proprietary
and private label brands. Verdant has pursued a strategy of growth through merger and
acquisition since 1996, joining four businesses together and increasing sales revenues
from approximately $15 million to $75 million in 1999. While successfully building the
revenue base, the complexity of the businesses acquired, combined with decreased demand
for some product lines because of industry changes and unfavorable weather patterns, has
led to ongoing losses and cash flow problems. Verdant recently named new management and is
restructuring the companys operations. In WWIs opinion, a major part of
Verdants difficulties are due to a lack of adequate permanent working capital. Now
that WWI has established an equity interest in Verdant, it is in a position to support
Verdant managements restructuring efforts. WWI will continue to evaluate the
potential acquisition of additional shares from time to time, although no decisions on the
number of shares or the timing of purchases has been made.

V. Forward-Looking Statements

The statements in this Form 10-QSB that are not historical facts or
statements of current status are forward-looking statements (as defined in the Private
Securities Litigation Reform Act of 1995) that involve risks and uncertainties. Actual
results may differ materially.

PART II- OTHER INFORMATION

Item 1. Legal Proceedings



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1. The former president of Seahawk, Inc. (Seahawk) filed suit on June
30, 1995 in the Superior Court of California, County of Orange, against the Company,
W&W, and several W&W employees, alleging libel and slander resulting from
consulting work W&W had done for Seahawk. The suit sought unspecified damages to be
proven at trial, plus punitive or exemplary damages. W&W's liability insurance carrier
defended against the suit, and in March 1997, the suit was dismissed. The individual has
filed an appeal of the dismissal. In February 1997, this individual served a second suit
that includes the Company, W&W, and a key employee as codefendants, along with several
unrelated parties. The suit alleges breach of contract and other causes of action and
seeks in excess of $5 million plus punitive damages. The Company's liability insurance
carrier has agreed to assume the defense of this action with a reservation of rights,
including the right to disclaim insurance coverage. Management believes the allegations
are without merit and is vigorously defending against the suit.

In May 1998 agreement was reached with the plaintiff that if the appeal
of the first suit fails, the second suit will be dropped. Due to a civil court backlog,
the appeal hearing has been delayed for several years. As of the date of this report, a
hearing date has not been set.

Item 2. Changes in Securities and Use of Proceeds

(c) Recent Sales of Unregistered Securities:

Following is a summary of sales of unregistered securities for the
three months ended June 30, 2000. All securities were issued as restricted common shares
which are subject to Rule 144 of the Securities and Exchange Commission. Generally, Rule
144 requires shareholders to hold the shares for a minimum of one year before sale. In
addition, officers, directors and more than 10% shareholders are further restricted in
their ability to sell such shares. There have been no underwriters of these securities and
no commissions or underwriting discounts have been paid.

Shares
    ValueIssued
    ReceivedExercise of warrants for cash
    210,122
    $115,591Labor services of management,directors and consultants
    25,000
    9,275Other
    1,409
    750236,531
    $ 125,616




The above transactions qualified for exemption from registration under
Sections 3(b) or 4(2) of the Securities Act of 1933. Private placements for cash were
non-public transactions. The Company believes that all such investors are either
accredited or, either alone or with their purchaser representative, have such knowledge
and experience in financial and business matters that they are capable of evaluating the
merits and risks of the prospective investment.



Item 6. Exhibits and Reports on Form 8-K



(b) No reports on Form 8-K were filed by the Company during the quarter ended June 30,
2000.



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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.



ITRONICS INC.



DATED: August 10, 2000
                                          
    
By: JOHN W. WHITNEY

John W. Whitney

President, Treasurer and Director

(Principal Executive Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has
been signed below by the following persons on behalf of the Company and in the capacities
and on the dates indicated.





DATED: August 10, 2000
                                          
    
By: JOHN W. WHITNEY

John W. Whitney

President, Treasurer and Director

(Principal Executive Officer)



DATED: August 10, 2000
                                          
    
By: MICHAEL C. HORSLEY

Michael C. Horsley

Controller

(Principal Accounting Officer)



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