Mar 13, 2009. /Lesprom Network/. Japanese Mitsui & Co. this summer will begin Australian production of wood chips for making paper to ensure stable supplies of raw materials as regional demand rises, as Trading Markets informed Lesprom Network. The trading firm plans to double chip procurement from Australia to 2.7 million tons annually to supply countries such as China, where paper demand continues to grow. It also hopes to capture Japanese demand for paper made exclusively from reforested trees. South West Fibre Pty. Ltd., a joint venture of Mitsui and major Australian wood chip producer Midway Pty. Ltd., will construct a plant capable of churning out 1.3 million tons of chips a year. The facility will start operating this summer. The new plant will be located in the southwestern part of the state of Victoria, near an area where Mitsui has been conducting a reforestation program on more than 20 thousand hectares as a joint venture with Nippon Paper Group Inc. Trees grown through that project will be harvested to produce the wood chips. In conjunction with the new factory, Mitsui has acquired rights to use wood chip harbor facilities at an area port.