DuPont to build South Korea factory to make chip materials

SEOUL, Jan. 10 (UPI) -- DuPont plans to channel $28 million over the next two years to build a factory for chip materials in Cheonan, South Korea, the industry ministry said Thursday.

South Korea welcomed the investment from the U.S. chemical giant, not for its size but because the factory south of Seoul will churn out photoresists.

Photoresists, required to manufacture computer chips, have been subject to Japan's export curbs on South Korea. Amid a row over wartime laborers last July, Tokyo tightened controls on Seoul-bound exports of three key substances used in chips and displays, including photoresists.

The measure made South Korea scramble because the semiconductor powerhouse heavily relies on Japan for the supply of various materials. Japan holds more than 90 percent of the global photoresist market.

South Korea is home to the world's largest memory chip producer, Samsung Electronics, and No. 2 player SK hynix.

Late last year, Japan eased the regulations on the shipment of photoresists to South Korea, but tensions have remained.

The export restrictions on two other key substances - fluorinated polyimides used to produce smartphone displays and hydrogen fluoride used in chips - remain intact.

"Even though Japan eased export bans of photoresists, it is not a fundamental solution," Korea's Trade, Industry and Energy Minister Sung Yoon-mo said in a statement.

"We will continue to put forth efforts to diversify our supply chain of key materials, parts and equipment."