UPDATE 1-CRU/CESCO-Chile's Madeco to move to plastic from copper

(Adds CEO comment, details)

By Antonio de la Jara

SANTIAGO, April 1 (Reuters) - Chilean copper cable and pipe manufacturer Madeco MAD.SN(MAD.N) has decided to refocus its core business on plastics, citing slumping copper demand in Chile and Argentina.

Madeco Chief Executive Cristian Montes told Reuters at the CESCO Week/CRU copper conference in the Chilean capital Santiago that the copper cable and copper tube market had been hard hit by the global financial crisis.

He said the company would focus its business on making its resealable freezer bags, already a strong area of its business.

"In the mass consumption market, we are not expecting a big drop in demand for plastic bags, because people aren't going to stop eating," said Montes. "They may eat cheaper products, but all those products are associated with bags for storage."

He added, "From our perspective it is difficult to predict" when copper prices will improve. "All of our clients associated with the construction market are suffering, basically in Chile and Argentina."

Copper prices are less than half what they were a year ago, as the industry was hit by a demand slump sparked by the global economic crisis that sent many of the world's top economies into recession.

Montes said recent fiscal stimulus packages announced by the government and aggressive rate cuts by the central bank were encouraging and may reinvigorate the construction industry.

"We are very hopeful for the construction industry, especially in Chile and with plans for investment in infrastructure and housing. We are hoping this could help reactivate the sector," he said.

(Reporting by Antonio de la Jara; writing by Pav Jordan; Editing by John Picinich)

((antonio.delajara@thomsonreuters.com; 562 370 4261; Reuters Messaging: antonio.delajara.reuters.com@reuters.net)) Keywords: COPPER CONFERENCE/MADECO

(C) Reuters 2009. All rights reserved. Republication or redistribution ofReuters content, including by caching, framing or similar means, is expresslyprohibited without the prior written consent of Reuters. Reuters and the Reuterssphere logo are registered trademarks and trademarks of the Reuters group ofcompanies around the world.nN01471527