Shin-Etsu to spend Y100 bln in US vinyl chloride plant

TOKYO, April 4 (Reuters) - Japan's Shin-Etsu Chemical Co will spend 100 billion yen ($1.06 billion) to build a plant in the United States to boost production of input material for vinyl chloride resin, the Nikkei business daily reported on Sunday.

Shintech Inc, a wholly owned subsidiary based in Texas, is expected to build the new plant at a complex in Louisiana, which began operations in October 2008, the newspaper said.

The new plant's annual output capacity of the liquid input material is expected at 800,000 tonnes, doubling Shin-Etsu Chemical's U.S. capacity to 1.6 million tonnes in 2011, Nikkei said.

The new plant will help reduce Shin-Etsu Chemical's reliance on other companies for input material procurement and used as a basis for exporting more products from the U.S. to emerging markets like South America, the newspaper said.

Shin-Etsu currently procures 70 percent of such input material from other firms, mainly Dow Chemical Co, and the Japanese firm wants to bring that ratio below 40 percent to reduce costs, Nikkei said, without citing sources.

Shin-Etsu Chemical, the world's top maker of vinyl chloride resin, used in construction materials and water pipes, also plans to double its annual output of sodium hydroxide to 1.06 million tonnes, the newspaper said.

Shin-Etsu officials were not immediately available for comment.

($1=94.58 Yen)

(Reporting by Chikako Mogi; Editing by Sanjeev Miglani)

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