Grain for Ivan

U.S. farmers get a lot of bread

For months U.S. satellites arching high above grainfields of the Soviet Union have been sending back disturbing reports: floods followed by drought have badly damaged the crops. Last week, in a secret meeting in London, Soviet agricultural officials conceded to their American counterparts that the U.S.S.R. is headed toward one of its most disappointing grain harvests ever--about 185 million metric tons, way down from last year's 237 million metric tons. The Soviets asked to enlarge significantly their purchases of American wheat and corn, so that they will rival in magnitude the record Russian buying of 1972.

Right after the London meeting, Agriculture Secretary Bob Bergland unwrapped a package of measures intended to bring cheer--and perhaps as much as $1.8 billion in increased income during election year 1980--to the nation's farm lands. Over the next 14 months, the U.S. will sell the Soviets 10 million metric tons of wheat and another 10 million metric tons of corn; the wheat alone is enough to provide every Soviet man, woman and child with almost 100 1-lb. loaves.

To help U.S. farmers increase output, Bergland lifted the federal "set aside" requirement that has obliged them to keep 20% of their acreage out of cultivation.

And he expanded their credit by announcing a 150 increase, to $2.50 per bu., in the amount a farmer can borrow from federal agencies against his wheat crop.

At the same time, Bergland warned that under the 1977 farm law the federal support price will drop by 330, to $3.07 per bu., next year. That decrease will be more than offset by market forces. Because of the Soviet purchases, U.S. farmers stand to sell more grain than ever at prices somewhat higher than the present $4.22 per bu. for wheat and $2.77 for corn.

Department of Agriculture economists contended that the Soviet sales would not lead to a repeat of the 1972 episode, when the Soviets secretly bought nearly 20 million metric tons of U.S. grain and sent domestic food prices through the roof. Under a bilateral grain treaty, the Soviets cannot buy more than 8 million metric tons unless the U.S. has extra supplies. Since stockpiles are ample and a near record harvest is in view, the department's chief economist estimated that the huge Soviet purchases would add only .2% to the cost of living index.

Even such a fractional rise will irritate inflation-squeezed Americans. Nonetheless, higher exports of U.S. farm products are the best hope for reducing the nation's trade deficit, which is caused largely by oil imports. Since America's appetite for foreign oil will remain intense, it is necessary to sell more food abroad even if that means slightly higher supermarket bills at home.

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