PHP XML parser, I cant find bug :-( [on hold]

I got a gigantic XML that I would like to insert to my database. I have searched a lot solutions, but cant make anything to work actually. This one seems great, if it worked. Can you help me please?

XML FILE:

<EXPORT>
 <PRODUCT>
  <ID>1070</ID>
  <CATALOG_NUMBER>plwcx100</CATALOG_NUMBER>
  <IMAGES>
    <IMAGE_URL>http://ift.tt/1BpM7Lw;
  </IMAGES>
  <PARAMETERS>
    <ITEMS>
      <PARAMETER_NAME>Rozteč</PARAMETER_NAME>
       <PARAMETER_VALUE>5x108</PARAMETER_VALUE>
    </ITEMS>
    <ITEMS>
      <PARAMETER_NAME>Průměr kola</PARAMETER_NAME>
       <PARAMETER_VALUE>16&quot;</PARAMETER_VALUE>
      </ITEMS>
  </PARAMETERS>
   </PRODUCT>
   <PRODUCT>...</PRODUCT>
</EXPORT>

PHP CODE:

$xml = new XMLReader();
$xml->open('product_example.xml');
while ($xml->read()) {

if ($xml->nodeType == XMLReader::ELEMENT) {

    switch ($xml->name) {

        case 'PRODUCT':

            $cat = new SimpleXMLElement($xml->readOuterXML());

            echo '<pre>'; print_r($cat); echo '</pre>';unset($cat);
            /* I would like to insert values into database here */
            break;
      }
   }
}

But this code doesnt work at all :-( I dont know why. When I put "EXPORT" into case statement I get what I need, but it is just in one cycle and thats too much for memory for the big XML files. Can anyone see a bug , or what can I change? I am solving this for too long. Thank you so much!