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EXHIBIT 99.1

|          |  |                                                                                   |  |                                                     
|--------- |  | --------------------------------------------------------------------------------- |  | ----------------------------------------------------
|Contacts: |  | Jeffrey T. Cook
President and CEO
Penford Corporation
425-462-6000
jcook@penx.com |  | Stephen Davis
MWW/Savitt
206-505-8380
sdavis@mww.com

PENFORD CORPORATION ANNOUNCES
STRATEGIC RESTRUCTURING;
APPOINTS THOMAS D. MALKOSKI AS CEOCorp. Headquarters to be Relocated to Denver; Jeffrey T. Cook Remains as Board
Member

BELLEVUE, Wash., January 4, 2002 Penford Corporation (Nasdaq: PENX) announced
today that it will strategically restructure business operations to strengthen
the Companys position as a market leader in delivering
technically-differentiated, specialty ingredients to the food, paper and
textile industries. The restructuring comes as a result of the rapid growth of
its North American food ingredients business, the addition of Penford Australia
Limited last year and the changing landscape of the North American paper
industry. Penford will relocate corporate headquarters from Bellevue,
Washington to Denver, Colorado, a location more central to customers and
operations, as well as the base of its fast-growing food ingredients business.
Penford anticipates completing the restructuring during the 2002 fiscal year
and expects to record a restructuring charge in its second fiscal quarter
ending February 28, 2002.

Penfords board of directors has appointed Thomas D. Malkoski to serve as the
new CEO of the Company, as Jeffrey T. Cook, the current president and CEO, will
not be relocating to Denver for personal reasons. Malkoski will join Penford
effective immediately as its new CEO and as a member of its board of directors,
while Cook will remain president until an effective transition is completed.
Cook also will continue as a member of Penfords board of directors.

Malkoski brings extensive branded foods and specialty food ingredients
experience to Penford Corporation. He also has significant knowledge in
running complex organizations the size of Penford. Malkoski spent the last
four years as president and CEO of North American operations for Griffith
Laboratories, a specialty food ingredients business. Prior to this, he worked
for Chiquita Brands International, successfully managing its Asian and South
Pacific operations for





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several years. Malkoski began his career with Procter and Gamble in 1980 where
he progressed to major product category management responsibilities.

Upon being named chief executive officer, Malkoski stated, I am very pleased
to join
Penford at this point in its development. Penford has important strategic
assets in its market positions, products, and people. We will work aggressively
to achieve our strategic objective of building shareholder value by delivering
total solutions to our customers through products and services combined with
efficient utilization of all resources.

Cook added, Its important that Penford makes these restructuring moves at
this time. By relocating corporate headquarters to Denver, we can leverage
our unique product advantages in the marketplace more effectively, maximizing
the value we can bring to our shareholders, customers and employees. While it
is unfortunate that my personal circumstances will not allow me to lead this
effort from our new Colorado-based headquarters, I am looking forward to
supporting Tom in his new role and watching Penford continue to grow and
prosper in the years ahead.

William G. Parzybok, Jr., chairman of the board of Penford, said, Jeff has
been an excellent, dedicated leader for Penford Corporation handling a variety
of responsibilities over the past twenty years. Numerous milestones have been
achieved in his tenure as CEO, including the successful acquisition of Penford
Australia Limited. The Board is particularly grateful for Jeffs leadership
and strong support in this latest evolution of Penford. We respect his
decision to remain in the Seattle area and appreciate his continued commitment
to positioning Penford for even greater customer value, focus and market
leadership. Penford is also very fortunate to now look to Tom Malkoski to lead
the Companys strategic direction, strengthen its operational efficiencies, and
deliver improved shareholder value. Toms expertise and experience are major
strengths that he brings to the growth opportunities we have at Penford.

About Penford Corporation

Penford Corporation develops, manufactures and markets specialty natural-based
ingredient systems for various applications, including papermaking, textiles
and food products.





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This press release contains forward-looking statements concerning the Companys
future performance and the benefits of a planned restructuring. There are a
variety of factors which could cause actual events to differ materially from
those projected in the forward-looking statements such as unanticipated
expenses or timing delays associated with this restructuring or the possible
ineffectiveness of the restructuring, as well as other factors listed in the
Companys SEC reports, including the report on Form 10-K for the year ended
August 31, 2001.