Sumitomo Chemical is planning to build a ArF photoresist factory in South Korea.
Its subsidiary Dongwoo Fine-Chem will build the factory at its Iksan plant.
The new factory will start operations in 2024.
The material is used in advanced semiconductor production.
Japan’s Nikkei said the chemical firm is expected to spend 10 billion yen on the new factory.
Its completion will increase Sumitomo’s photoresist production by 2.5 times, it said.
The material is used to draw the electrical circuit on the silicon wafer.
The new factory will be Sumitomo’s first foreign factory for photoresist.
Since the trade restrictions imposed by Japan against South Korean companies in 2019, South Korea chip firms had asked its suppliers to diversify their production facilities.
Other Japanese material companies are also increasing their spending in South Korea.
Daikin said in October that it plans to spend 4 billion yen for a new hydrogen fluoride factory in South Korea.
TOK built a new EUV photoresist factory last year and has already started production.
Kanto Denka has begun production of carbonyl sulfide at its new plant at Cheonan since last year.