Toronto, Oct 14, 2008 - SunOpta ("the Company" or "the Company's") today provided an update on initiatives undertaken by the Company's international sourcing and trading operations, specifically The Organic Corporation, operating as Tradin Organics. These initiatives expand SunOpta's organic sourcing and supply capabilities in Ethiopia.
Recently Tradin Organics finalized a joint venture agreement, through the Dutch government's Emerging Markets Cooperation Programme (PSOM), with an Ethiopian based partner and created Selet Hulling to source and produce organic sesame seeds for international distribution. Tradin Organics has a 35% ownership position in this venture and also has the exclusive rights for international distribution of the finished product. The mandate of the Selet Hulling joint venture is to set up a top quality HACCP operated organic certified sesame seed hulling operation and export the output to world markets via the Company's sales and logistics personnel. The project is expected to have a very positive impact on local development in Ethiopia, resulting in higher incomes for farmers, the creation of additional employment in the area, the introduction of the new dry hulling technology and the sharing of best practices and knowledge on sustainable organic agriculture. It is estimated that the joint venture will generate incremental profitable annualized revenues of approximately $4 million to $6 million commencing in 2009.
In addition, Trabocca BV ("Trabocca"), a subsidiary of Tradin Organics, has entered into an agreement to assume control of the organic coffee sourcing and processing assets from Alanheri Produkten BV ("Alanheri"), expanding its existing organic coffee platform. As per the terms of the agreement with Alanheri, Trabocca has assumed a number of existing supplier and customer relationships, as well as the organic certifications. It is estimated that these assets will further position Trabocca as a supplier of choice for certified organic Ethiopian origin coffee and will allow the Company to continue to expand its customer base. It is estimated that this expansion will generate incremental profitable annualized revenues of approximately $5 million to $7 million.
Both the Selet Hulling joint venture and the combination of the Alanheri coffee business with Trabocca will provide expanded Ethiopian based supply to the Company; thereby extending the Company's presence in this area of the world.
Gerard Versteegh, Director of The Organic Corporation commented, "We were particularly excited to undertake these two initiatives, not only do they provide good returns to the Company, but they demonstrate our Company's commitment to social responsibility and the environment."
Menno Simons, Managing Director of Trabocca commented, "Our agreement with Alanheri allows Trabocca to diversify its supply source in a key coffee growing region in the world. The employees at Trabocca are dedicated to working with our customers and suppliers in order to deliver high quality products. We welcome and look forward to working with our new customers and suppliers."
Steve Bromley, President and Chief Executive Officer of SunOpta Inc. commented, "These initiatives further expand our Company's organic sourcing and supply capabilities, one of the keys to our continued strategic growth plans. Beyond expanding supply, these initiatives also allow us to bring employment and sustainable agricultural practices to a part of the world that is in need of such support."