Bountiful Harvest, Bleak Outlook

By Barbara Rudolph

As combines rumbled through golden Dakota wheatfields last week, all signs pointed to a handsome harvest. The corn belt through Indiana, Illinois and Iowa was a healthy bright green, and soybean fields from Minnesota to Missouri sprouted lush and leafy plants. But bounty is a mixed blessing for American farmers, who are mired in a deepening agricultural depression. "This is the crop of our lives," says Roger Ellison, who farms 400 acres of corn and soybeans 45 miles north of Columbia, Mo. "The sad thing is, there's no price in the market for it."

A report released last week by the Department of Agriculture gave a preview of just how tough the market will be. The survey predicted that the corn crop will increase by 8% from last year, to a record 8.27 billion bu. The soybean harvest is expected to be up 5%, to 1.96 billion bu., while cotton production will rise 6%, to 13.8 million bales. These bumper crops are sure to depress agricultural prices, which are already at extraordinarily low levels. Corn is selling for $2.32 per bu., down from $3.36 in June of 1984. Soy beans, which sold for $8. 12 per bu. in May of last year, have sunk to $5.22.

The only glimmer of good news was the projection that the wheat crop, while plentiful, will dip by 8%, to 2.38 billion bu., its lowest level in six years. That decline will occur primarily because most wheat farmers harvested 30% fewer acres than last year in return for federal subsidies. Even after this cutback in production, wheat is selling for a mere $2.90 per bu., down sharply from a high of $4.21 in early 1981.

Meager prices will push more and more debt-ridden farmers off the land. The Agriculture Department says that the number of U.S. farms declined by nearly 2% during the past year, to 2.3 million. Last week Merlin Reiber of Griswold, Iowa, watched as an auctioneer sold his farm equipment. Said he: "I'm not going to roll over and play dead. But I don't have any idea what to do now."

Though agricultural prices are low, the cost of food at the grocery store is expected to rise as much as 4% this year. The increase reflects the higher costs of processing, packaging and distribution. Wholesale food prices jumped by 1.3% during July alone, the largest monthly advance in a year.

Farmers, who are not benefiting from the higher consumer prices, are increasingly frustrated and angry. To advertise his plight, Gary Seidenberger, 42, of St. Lawrence, Texas, used a harvesting machine to carve a series of pathways through his wheatfield that formed the shapes of letters. The field then contained the giant message FARMING STINKS!, which became a favorite view of commercial airline pilots and passengers.

The farm crisis will hurt efforts to bring the federal deficit under control. The budget compromise approved by Congress earlier this month called for farm aid over the next three years to be cut by 24% from previous projections, to $34.8 billion. That reduction will be difficult to make because of this year's bumper crops, which, by lowering agricultural prices, will raise the level of the Government's price-support payments. William Lesher, a former chief economist at the Department of Agriculture, predicts that the cost of Government farm programs next year will be between $5 billion and $7 billion more than the Administration had estimated. But even that increase may not begin to relieve the distress felt by America's farmers. --By Barbara Rudolph. Reported by David Beckwith/Washington and Lee Griggs/Chicago

With reporting by Reported by David Beckwith/Washington, Lee Griggs/Chicago