UPDATE 1-Mitsubishi, others eye non-food ethanol fuel plant

(Adds background, Mitsubishi denial)

TOKYO, June 20 (Reuters) - Top Japanese trading house Mitsubishi Corp (8058.T), oil refiner Idemitsu Kosan Co (5019.T) and two others are considering building an ethanol factory using non-food feedstocks to meet growing demand for alternative auto fuel, Mitsubishi said on Friday.

Mitsubishi said the two, together with a Honda Motor Co (7267.T) subsidiary and Japan's Research Institute of Innovative Technology for the Earth (RITE), met at the end of May to discuss the issue and are now conducting a feasibility study.

The Nikkei business daily said on Friday that Mitsubishi and Idemitsu would invest 10 billion yen ($92 million) to build a factory in North America, China or Southeast Asia, with output of 200,000 to 500,000 kilolitres a year by 2011, the paper said.

Honda R&D Co and RITE, a government-affiliated research institute, have jointly worked on a technology that enables production of bio-ethanol from waste biomass.

Last August, a senior Mitsubishi manager told Reuters the trading house was aiming to take a slice of the world's growing green fuel market and would target an annual 2 million kilolitres of green ethanol output capacity by 2017. [ID:nT165410]

Idemitsu, Japan's third-largest oil refining company, was not immediately available for comment. ($1=107.96 Yen) (Reporting by Risa Maeda and James Topham; Editing by Hugh Lawson)