Mitsubishi Materials to boost silicon production

TOKYO, March 14 (Reuters) - Japan's Mitsubishi Materials Corp (5711.T: Quote, Profile, Research, Stock Buzz) said on Friday it would invest 33.5 billion yen ($334 million) to boost output capacity of a key ingredient used in solar batteries and semiconductors by 1,000 tonnes a year.

The nonferrous metal smelter and maker of electronics materials said it plans to increase polycrystalline silicon production to 4,300 tonnes a year by 2011, in response to expanding semiconductor markets in developing countries.

The company also said it expects demand for the silicon to strengthen as solar batteries gain popularity due to growing awareness about environmental protection.

Mitsubishi Materials said it would finish constructing a new polycrystalline silicon production facility next to an existing factory in Yokkaichi City of western Japan by 2010.

The firm, whose electronic materials segment makes up about 6 percent of its operations, aims to further raise its polycrystalline silicon production in the future, by an additional 3,000 to 4,000 tonnes, it said.

Prior to the announcement, shares of Mitsubishi Materials ended Friday morning trade up 1.6 percent at 447 yen, against the benchmark Nikkei's .N225 0.5 percent rise. (Reporting by Yoko Kubota; Editing by Chris Gallagher)