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U.S. chemical kingpin Dow Chemical’s (DOW - Analyst Report) joint venture chlor-alkali facility with Mitsui & Co., Ltd. of Japan has successfully commenced full-scale, commercial production. The facility, based in Freeport, TX, has been set up to produce chlorine and caustic soda used as feedstock in a number of industrial and chemical processes and products.

Dow’s share of the chlorine produced at the joint venture – Dow-Mitsui Chlor-Alkali – will be used to meet the increasing feedstock needs of its performance and market-driven businesses. The company will market the caustic soda on behalf of the joint venture.

The joint venture facility enables Dow to capitalize on its state-of-the-art membrane chlor-alkali technology. The Dow-Mitsui Chlor-Alkali joint venture boosts the integration strength of the chlorine value chain at Freeport, enabling the company to invest in businesses which are downstream technology and customer-driven with greater and more consistent earnings.

Dow, in late 2013, divulged its plans to shutter roughly 800,000 tons of chlorine and caustic equivalent capacity at its Freeport site. Supply from the world-class Dow-Mitsui Chlor-Alkali facility will replace the capacity being shut down on the site. The facility has annual production capacity of roughly 800 kilotons of chlorine.

Dow is benefiting from strong fundamentals in the agriculture and food markets, and is leveraging its North American feedstock advantage. A string of innovative products in its pipeline adds to its strength.

Moreover, Dow remains committed to its cost reduction and efficiency programs while reducing debt, improving cash flows and maximizing shareholder returns. The company also continues to invest in attractive regions through highly-accretive projects. Dow expects its strategic actions to drive earnings and enhance shareholder value in 2014.

Dow is a Zacks Rank #2 (Buy) stock.

Other companies in the chemical industry with favorable Zacks Rank include Methanex Corporation (MEOH - Analyst Report), PPG Industries Inc. (PPG - Analyst Report) and LyondellBasell Industries NV (LYB - Analyst Report). All retain a Zacks Rank #2 (Buy).

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