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Huntsman profit falls as chemical selling prices decline

* Third-quarter EPS $0.26 vs $0.48 last year

* Adjusted EBITDA in its pigments business falls 52 pct

* Total costs rise 6 pct

Oct 29 (Reuters) - U.S. chemical maker Huntsman Corp reported a 45 percent decline in quarterly profit due to lower selling prices and higher raw material costs.

Lower selling prices in its biggest business, which makes polyurethane chemicals used to make foam materials and adhesives, led to a 12 percent fall in the unit's adjusted earnings before interest, taxes, depreciation and amortization (EBITDA).

Adjusted EBITDA in the pigments business fell 52 percent in the latest reported quarter due to lower selling prices even as sales volumes rose. The business produces titanium dioxide pigment used to give a white tint to everything from toothpastes to cars.

Huntsman's total costs of goods sold rose 6 percent.

"Earnings within our pigments business have been improving throughout the year and we are encouraged by industry trends," Chief Executive Peter Huntsman said on Tuesday.

The CEO has said he expects demand for titanium dioxide to improve in the coming quarters, partly due to a recovery in automobile and housing industries in North America.

Pigment prices have been on a roller-coaster for the past several years, largely due to surplus capacity.

The company agreed to buy Rockwood Holding Inc's titanium dioxide paints pigments business and other small businesses for $1.1 billion in cash last month.

Huntsman plans to spin off about 20 percent of the combined pigments business within two years of the deal closing in June.

The acquisition will take Huntsman's global titanium dioxide capacity behind that of DuPont's, which is also spinning off its titanium dioxide unit.

Net income attributable to Huntsman fell to $64 million, or 26 cents per share, in the third quarter ended Sept. 30, from $116 million, or 48 cents per share, a year earlier.

Excluding one-time items, Huntsman earned 54 cents per share.

Revenue rose 4 percent to $2.84 billion.

Analysts on average had expected earnings of 54 cents per share on revenue of $2.82 billion, according to Thomson Reuters I/B/E/S.

Huntsman shares closed at $21.71 on the New York Stock Exchange on Monday. They have risen about 40 percent so far this year to Monday close.