TORONTO, June 23 /CNW/ - SunOpta Inc. (SunOpta or the Company) (NASDAQ:STKL) (TSX:SOY). Yesterday at the International Fuel Ethanol Workshop & Expo in Milwaukee, Wisconsin, SunOpta's BioProcess Group discussed developments in the cellulosic ethanol market in China and other parts of the world. Today, the Company is pleased to announce that it has signed a contract to sell a cellulosic ethanol pilot demonstration facility, which is based on SunOpta's patented and proprietary biomass conversion technology, to China Resources Alcohol Corporation (CRAC) for research and development on cellulosic ethanol production at their facility in ZhaoDong City, Heilongjiang Province. Based upon completion of final details, the companies anticipate that this cellulosic ethanol research facility will start up in late 2006. Terms of the sale were not disclosed. As part of the transaction, SunOpta and CRAC intend to enter into a Joint Development Agreement between SunOpta, CRAC and Novozymes for the development of cellulosic ethanol in the People's Republic of China. The Chinese central government recently announced a $5.0 Billion US capital investment over the next 10 years on ethanol capacity expansion with a focus on cellulosic ethanol. The SunOpta Bioprocess Group has been designing, building and optimizing biomass conversion plants for over thirty years. End products include cellulosic ethanol, cellulosic butanol, xylitol and dietary fibre for human consumption. Raw materials include wheat straw, corn stover, grasses, oat hulls, wood chips and sugarcane bagasse. CRAC is the second largest ethanol producer in China. CRAC's goal is to install 5,000 Tonnes per year (1.7 Million US gallons per year) of cellulosic ethanol capacity by the end of 2007 and 1,000,000 Tonnes per year (330 Million US gallons per year) by 2012 utilizing multiple lines of SunOpta's proprietary process technology and equipment. Novozymes (NASDAQ:NVZMF)(CSE:NZYM) is a world leader in the production of enzymes necessary to convert corn or agricultural waste, such as corn stover, wheat straw and wood chips, into fuel ethanol for automobiles. The Company has been instrumental in revolutionizing the production of transportation fuel through application of its enzyme technology for ethanol, both based on corn starch and agricultural residues such as corn stover. Murray Burke, Vice President and General Manager of SunOpta's BioProcess Group, commented that, "We are very pleased to partner with CRAC and Novozymes on this major roll out of cellulosic ethanol production in the People's Republic of China. This is a confirmation that SunOpta is a world leader in the development of cellulosic ethanol technology." About SunOpta Inc. SunOpta Inc. is an operator of high-growth ethical businesses, focusing on integrated business models in the natural and organic food markets. The Company has three business units: the SunOpta Food Group, which specializes in sourcing, processing and distribution of natural and organic food products integrated from seed through packaged products; the Opta Minerals Group, a producer, distributor, and recycler of environmentally friendly industrial materials; and the SunOpta BioProcess Group which is a world leader in biomass conversion technology for producing biofuels and other value added products from biomass. Each of these business units has proprietary products and services that give it a solid competitive advantage in its sector. Forward-Looking Statements Certain statements included in this press release may constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to references to business strategies, competitive strengths, goals, capital expenditure plans, business and operational growth plans and references to the future growth of the business. These forward looking statements are based on certain assumptions and analyses made by the Company in light of its experience and its interpretation of current conditions, historical trends and expected future developments as well as other factors that the Company believes are appropriate in the circumstance. However, whether actual results and developments will agree with expectations and predications of the Company is subject to many risks and uncertainties including, but not limited to; general economic, business or market risk conditions; competitive actions by other companies; changes in laws or regulations or policies of local governments, provinces and states as well as the governments of United States and Canada, many of which are beyond the control of the Company. Consequently all forward-looking statements made herein are qualified by these cautionary statements and there can be no assurance that the actual results or developments anticipated by the Company will be realized.