The partnership comes after KIPG bought ABB Grain's handling and storage facility on the island where up to 30,000t of grain can be stored.

The company also signed a long-term lease for a 6000t silo site at Kingscote.

More than 5000t of canola - nearly 75 per cent of the island's annual production - and 2000t of top-grade oats, 2000t of malting barley and 40t of canola honey will be sold as part of the deal, which also includes major Japanese companies Pal Systems, Kanematsu and Japan Seafoods. The Japanese will also look to source seafood from KI and the South Australian mainland.

KIPG has also made a historic agreement with Sealink Travel Group to guarantee carriage of a minimum of 20,000t of grain at reasonable freight rates to the SA mainland.

Sealink has also incorporated a new 5.30am ferry from the island, which will transport grain to Adelaide and return with products such as fertiliser - before business hours.

KIPG managing director Duncan MacGillivray said the arrangement was made possible because of the island's isolation and the premiums it could attract from 100 per cent traceability.

The company's ability to segregate varieties of grain and trace each load back to individual growers was appealing to participating Japanese companies, which would only import quality, safe, non-contaminated, eco-friendly food products.

"The non-GMO status for KI is crucial," Mr MacGillivray said.

* Full report in Stock Journal, October 1 issue.