CONSTRUCTION on a $250-million grain export facility at Port Spencer on the Eyre Peninsula is slated to begin next month after Peninsula Ports secured funding for the development.

The deal will see WA-based commodity trading company Aria Commodities partnering with Peninsula Ports. Peninsula Ports’ former parent company, Free Eyre, will remain a shareholder.

The Port Spencer grain export facility will be located 20 kilometres north east of Tumby Bay. It will have the capacity to store 800,000 tonnes of grain.

Peninsula Ports said it is planned to be operational in time for the 2023 harvest. The port’s ship-loading capacity will be 2400 tonnes per hour.

Peninsula Ports chair John Crosby said Aria Commodities is expanding in Australia and it sees Port Spencer as the ideal location to support Eyre Peninsula farmers as they export their grains to countries throughout the world.

“Once the deep-water port is built there will be significant benefits for the region, and we hope it will provide an economic boost to not just the Eyre Peninsula, but to the state as a whole,” he said.

A statement from Peninsula Ports said there had been “serious” safety concerns in the Port Lincoln community about trucks carrying grain travelling through the city’s streets to access its port since the railway line grain service ceased in 2019.

Mr Crosby said once the Port Spencer facility was operational, it would significantly reduce truck movements – potentially removing thousands of truck movements from Port Lincoln’s roads – in providing an export alternative away from the city.

Peninsula Ports also said using the port could also save growers up to $20 per tonne in costs by eliminating double handling, with a streamlined process ensuring grain can be stored directly on site and then transported via conveyor belts onto ships.

The Aria Commodities funding agreement was approved at a board meeting held in Port Lincoln on 3 May.

“The directors of Free Eyre and Peninsula Ports are delighted to be able to take the final step towards building a new port to aid the further development of the grain industry on Eyre Peninsula, while maintaining the direct connection between farmers and their market,” Mr Crosby said.

Peninsula Ports said it had signed an Indigenous land use agreement with the Barngarla community and is working with local residents to ensure there are community benefits, including the surfacing of roads.