Report of grain in island (4)
I believe the answer is:
bali
'island' is the definition.
(Indonesian island)
'report of grain' is the wordplay.
'report of' shows a homophone (sound like).
'grain' becomes 'barley' (barley is a kind of grain).
'barley' sounds like 'BALI'.
'in' acts as a link.
(Other definitions for bali that I've seen before include "Indonesian island, capital Denpasar" , "Holiday island to the east of Java" , "Indonesian holiday destination" , "Bail out of the island" , "mountainous island" .)