Banner Graphic, Volume 12, Number 95, Greencastle, Putnam County, 30 December 1981 — Page 5

Cash, futures prices have tumbled

Crisis in Poland already has cost U.S. grain farmers heavily

_e. 1981 \.Y. Times , 'NEW YORK Whatever the outcome of the Polish crisis in economic terms, American grain farmers have already paid a heavy price, and may be called upon for even greater sacrifices. Ail this despite the fact that another curtailment on grain shipments to the Soviet bloc has only been hinted by the administration since the Polish government began its repressive 1 moves two weeks ago. Since then, grain and soybean cash and futures prices have tumbled. Using the active near March Chicago contracts as a yardstick, wheat fell to $3.89 a bushel from $4.13 in the two >veeks; corn, to $2 68 from $2.72; soybeans, to $6.28 from $6.49. Actual cash prices received by farmers are usually much lower and depend on geographic, quality and other considerations. The Polish crisis erupted at a time when grain and soybean farmers had been paying heavily for producing record crops f his season. Indeed, farm prices have plunged since the harvests were gathered This has been reflected in the slowing of the rise in consumer prices the past tew months Even before the crisis, grain farmers were being driven in increasing numbers to pawn their crops with the government, not

Improve system of germplasm, USDA warned

WASHINGTON (AP) - The General Accounting Office has told the Agriculture Department improvements are needed in the national system for storing seeds and other ‘‘gernriplasm" as a genetic back-up for U.S. crop production. Plant scientists have been warning for many years that the genetic base of U.S. crops has been shrinking and that this represents a potential danger to future production. For example, if most or all of a crop is produced from the same or very similar genetic stock it could become vulnerable to disease, thus wiping out most of that year’s production. •T*Genetic vulnerability of Ireland's potato crop the 1830 s led to famine and the death of 2 million people when “a previously unknown disease” struck the harvests, the GAO Said. The GAO, an auditing agency :of Congress, submitted its report recentlyto Agriculture Secretary John R. Block, with Copies also going to key members of Congress. 3 A national germplasm sysDairy farmers are honored * Three Putnam County dairy iarm operators were among ihose receiving recent awards for superior performance, according to an announcement from the Indiana State Dairy Association (ISDA). ;! From Roachdale, Arvel Norion received a silver medal and Brookshire Farms, Inc. received a bronze medal. Verlin and Steve Cash, Fillmore, were Recognized for improvement in Average milk production. I The ISDA determines these Awards in cooperation with the Jlairy extension division of Pursue University’s Animal Sciences Department. ; • The awards cover production jif herds from October, 1980, jhrough September, 1981. The >ward certificates are to be presented at the 92nd annual of the Indiana State Jjairy Association.

FmHA revises housing loan guideline

- WASHINGTON (AP) The Farmers Home Administration has made some changes in regulations it says will “make it possible for more people” to get housing loans. - Charles W. Shuman, administrator of the Agriculture Department agency, said Tuesday the revisions change the income eligibility standards, permit funds for approved solar heating, and make “numerous changes” to clarify and simplify operations of the singlefamilly housing programs. The FmHA, as the agency trails itself, has a wide range of housing programs, including piortgage loans for single-fami-

Market reports INDIANAPOLIS f AP) Grain prices Tuesday at In-dianapolis-area elevators: Corn, N 0.2 yellow shelled 2.202.40, Feb. 2.38-2 44, Mar. 2.40-2.43; Oats, N 0.2 white 2.00; Soybeans, No.l yellow 5.71-5.88, Feb. 5.84-5.95; Wheat, N 0.2 soft red 3.35-3.50, new 3.42-3.46.

tern was designed to help guard against such losses by preserving the base stock germplasm of domestic and wild food plants. It is a cooperative system involving the department, state experiment stations and private germplasm preservers. “Historically, the United States has been able to return to areas of genetic diversity to collect germplasm for further breeding programs,” the GAO said. “However, in the last decade Mexican farmers have planted hybrid seed corn from a U.S. seed firm; Tibetan farmrs have planted barley from a Scandinavian plant breeding station; and Turkish farmers have planted wheat from the Mexican wheat program. "Each of these areas of cropspecific genetic diversity is rapidly becoming an area of seed uniformity, resulting in loss of genetic diversity.” The GAO report said the reason for concern about the loss of native strains is “the irreplaceable nature of genetic diversity.” The only place genes can be stored is in living systems such as the embryo in a kernel of corn or wheat. “The native varieties can become extinct once they are replaced in favor of seed introduced through plant breeding. The genetic heritage of a thousand years in a particular area can be lost in a single year.” it said. “A time may come when man is totally dependent on the genetic strains he has preserved.” The report said the department has exhibited “insufficient managment attention” regarding germplasm collection, storage and maintenance. Actions for improvement “should include identifying all curators; implementing a policy for backup storage; determining the viability of the small grains collection; and assuring that germplasm is adequately stored, monitored and replenished as needed.”

ly homes, housing repair and rehabilitation. Shuman said one of the major changes is the elimination of a single, nationwide income eligibility level. Previously, only families with incomes below $15,600 a year were eligible for FmHA housing loans, except in Alaska and Hawaii. Income ceilings now vary “by economic areas and are based on a percentage of the area median income.” Median income means half earn more than the median, half less. Low-income is defined as 80 percent of the area’s median income. Applicants who qualify for

waiting for the final details of the administration’s new fouryear farm bill, which was signed by the president two weeks ago. “The new farm price support levels are not the answer to the problems faced by the nation’s heavily indebted farmers, but they do provide some measure of relief,” said Sherman L. Levin, agriculture research chief at Paine Webber Jackson & Curtis, Chicago, in an interview last week. “But this relief is a season away .” Basically, the new farm bill raised both the “target” and crop loan rates in stages over a four-year period. When cash prices fall below the target level, the government pays the farmer the difference between the target and loan prices. For example, the target level for wheat in the current crop year that ends next May 31 is now $3.81 a bushel, while the loan rate at which farmers may pawn their grain is $3.20. The federal interest rate on the pawned grain is 14.5 percent a year. But farmers who place their crops in the three-year reserve program only pay interest on the first year. Even so, not many farmers are expected to redeem their grain because its quality and, consequently, market value, rarely improves with time.

Despite diplomat hassles, farm sales to Iran booming again

WASHINGTON (AP) Although Iranian and U.S. diplomats continue to officially ignore each other, Iran is again becoming a lucrative market for American farmers, an Agriculture Department researcher says. The estimated S3OO million in commodity sales to Iran this year compares with about $8 million in 1980, said John B. Parker of the department’s Economic Research Service. But the projected 1981 sales are significantly below levels established before U.S. hostages were taken in Tehran two years ago. Even though the Iranian government had begun to wind down purchases of U.S. food before Iranian militants took embassy personnel hostage Nov. 4, 1979, sales still totaled $415 million that year. haven’t returned fully to us as a supplier of anything but wheat,” Parker said.

egional hearings in February

Overhaul of beef grading standards under study

WASHINGTON (AP) - A proposal to overhaul federal beef grading standards will be discussed at a series of public hearings in February, says the Agriculture Department. Under the proposal, leaner beef would qualify for Prime and Choice grades but would “not significantly lower the palatbility” or taste of either grade. Beef in the Good grade “would be leaner with lowered palatability.” The proposal, which was announced Tuesday, is mostly in line with a recommendation by

Exports total nearly one-third of U.S. farm production

WASHINGTON (AP) Not only have U.S. agricultural exports shown a steady overall increase for more than a decade, they now represent almost a third of total production by the nation’s farmers. According to a recent Agriculture Department analysis, 30.2 percent of the total value of

moderate-income loans those above the low-income rating will pay the prevailing interest rate when the loan is closed. Currently, FmHA charges 13.25 percent. For qualified low-income borrowers, the agency provides interest credits which reduce the amount of interest the borrower pays, sometimes to as low as 1 percent. The FmHA, using information developed by the Department of Housing and Urban Development, is now setting income eligibility limits in more than 500 “economic areas” nationwide, Shuman said.

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the National Cattlemen’s Association to allow less fat “marbling” in the top grades of beef. However, the department’s proposal calls for somewhat more marbling than the cattlemen had wanted. By having leaner beef qualify for the top grades, producers will not have to fatten their cattle as much, thus saving an estimated SIOO million or more in annual feed costs. Prime has the most marbling, followed the the remaining federal quality grades: Choice, Good, Standard, Commercial,

commodities marketed by farmers in 1980 was exported. That compared to 14.4 percent in 1970, says the department’s Economic Research Service. The agency’s report showed that 5.6 percent of the value of livestock marketings was exported in 1980, compared to 2.9 percent in 1970. Exports of

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Under the new farm bill, the government cannot sell the grain it acquires through defaults on its reserve program at, in effect, less than 110 percent of current release price, a market level at which farmers are required to redeem their crops. As Levin observed; “In the case of corn, it means that the Commodity Credit Corporation could not sell the grain at less than 80 cents a bushel above the current price level on the farm. But farmers needn’t worry about the government’s stocks of grain. Much of it could be disposed of through donations to needy countries under various relief programs.” The threat of Government stocks acquired through default on loan programs had been a market depressant in past years of burdensome surpluses. What still frightens the farmers is the threat of another embargo. Not only would it shut off sales to an important customer, but also strengthen foreign competition. In June 1973, President Nixon, reacting to a possible shortage of soybeans, embargoed exports of the oilseed and caused panic buying by Japan, which depends on it for much of its imported protein. As a result, Brazil, then a minor soybean producer, was encouraged by Japanese and other investors to sharply increase

The U.S. hostages were released in January after more than 16 months of captivity. President Reagan told Congress last month: “It appears that full normalization of commercial and diplomatic relations between the United States and Iran will require more time. ” His assessment was contained in a message informing Congress he was keeping in force a declaration of emergency issued by then-President Carter after the hostages were seized. Parker said he expects U.S. wheat sales to Iran this year to be around 1 million metric tons or more, compared with 50,000 tons last year, 611,000 tons in 1979 and 1.2 million tons in 1978. U.S. rice sales to Iran may total about 100,000 tons in 1981, Parker said. None was sold last year, but 285,500 tons went to Iran in 1979.

Utility, Cutter and Canner. However, grades that consumers see at retail meat counters are mostly the top three. Some consumer groups, including the Community Nutrition Institute, also advocated leaner beef under the grading system but wanted to change some of the names of the grades to help enhance consumer acceptance of them. Under the institute’s plan, for example, Standard would be changed to Lean as a way of telling consumers more precisely what they were buying.

crops amounted to 54.3 percent of 1980 marketings, compared to 30.5 percent a decade earlier. “It became apparent in the early ’7os that production in many areas of the world, particularly in less-developed countries, would not be able to keep pace with population growth,” the report said.

Grange backs grain embargo

WASHINGTON (AP) - The National Grange has told President Reagan it would support an across-the-board embargo of trade with the Soviet Union to counter Soviet activity in Poland. Edward Andersen, master of the Grange, explained his organization’s feelings in a letter

The proposal made by the department, however, calls for elimination of Standard, a recommendation made by the cattlemen. Ellen Haas, the institute’s consumer director, called the department’s proposal “just a reshuffle of standards without any consumer benefit.” Besides its provisions for altering the fat marbling specifications, the proposal calls for changing the related standards for grades of slaughter cattle to reflect changes in the grades proposed for carcass beef. No

“In addition, rapid income growth and significant trade policy changes increased effective demand for agricultural products. The United States responded by removing production control programs in 1980.” Because of the greater demand, particularly for grain and oilseeds, 40 percent

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December 30,1981, The Putnam County Banner-Graphic

output. Today, Brazil is the second major exporter of soybeans and bean oil and meal. In January 1979, President Carter imposed a partial embargo on grain exports to the Soviet Union following its military intervention in Afganistan the month before. This vastly stimulated grain production in Argentina, Western Europe and other countries. A recent report by Bache Halsey Stuart Shields Inc. noted that Thailand and South Africa had greatly stepped up corn exports to such important American markets as South Korea, Taiwan* the Soviet Union and Japan. Typically, a recent Thailand-Soviet barter deal involved the exchange of 4 million bushels of corn for 50,000 metric tons of fertilizer, Bache noted. In fact, the Soviet Union has succeeded in diversifying its imports of grain since President Reagan lifted the partial curtailment last May. How much so will be revealed after the Southern Hemisphere’s grain crops are harvested next March and April. Farmers here also fear that after an unprecedented three consecutive poor crop years experienced by the Soviet Union, the odds against a fourth one next year have fallen sharply.

to Reagan. “We want you to know that the National Grange will support economic sanctions against the Soviet Union. However, we cannot support a trade embargo that solely applies to the trade of agricultural commodities,” Andersen saiid. “We urge you to end all trade

Wheat and rice make up about 80 percent of the food sales to Iran, with corn, sugar, corn oil and a small quantity of cheese making up most of the rest, he said. Iran formerly was a significant buyer of U.S. soybean oil but turned to Brazil the past couple of years, Parker said. Parker said Iran’s food imports from all sources the United States and other countries “are really up in the air” and may reach a record $3.4 billion this year. Iran does not have a large trade deficit because its total import bill for all items is “not much more than they’re getting from petroleum,” Parker said. “The $3.4 billiion for food items apparently is not as big a problem as people thought it was,” he said. “Probably the logistics of paper work and banks is more of a problem than the money to pay for it.” for church pg...,

changes would be made in the “yield” grade standards which indicate the cutability of beef carcasses. Federal grading is a voluntary service paid for by those who request it, and not all beef is graded. In 1980, about 56 percent of total commercial beef production was graded. But approximatedly 75 percent of the “fed” beef supply was graded. It makes up most of the beef consumers buy as retail cuts, while “non-fed” beef cows and other animals

million metric tons of the world agricultural trade volume in 1980 came from the United States, compared to 25 percent in 1970. “Food grains (wheat and rice) are produced primarily for exports, while two-thirds of the feed grain production is retained in the United States to

to the USSR and other Eastern European countries,” he said “At the same time, we as a nation must insist upon complete cooperation from Western Europe and the industrialized nations in involving similar economic sanctions, including the postponement of the construction of the Siberian pipeline.”

that are not fattened on grain rations goes into hamburger and other processed items. The grading service with its familiar blue stamp on beef cuts was first offered in 1927. There have been a number of changes in the grades since then, including some modifications in 1975. Public hearings on the grading proposal, each starting at 9 a.m. local time, will be held: Feb. 9, Salt Lake City; Feb. 11. Atlanta; Feb. 16, Washington; Feb. 22, Des Moines, Iowa; and Feb. 25, Dallas.

support the livestock and poultry industries,” the report said. “About 55 percent of U.S. soybeans are exported either as beans or meal.” The report showed that last year 65 percent of the wheat crop and 68 percent of the rice was exported.

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