Wholesale prices, which foreshadow prices consumers eventually pay, rose by a slight 0.1 per cent in August. The increase was small mainly because of the fourth consecutive sharp decline in farm prices, the Department of Labor reported yesterday.

The 0.1 per cent rise in the wholesale price index follows declines of 0.1 per cent in July and 0.7 per cent in June. For the last three months, wholesale costs have been declining at a seasonally adjusted annual rate of 2.6 per cent.

Farm prices fell 4.3 per cent and feed prices dropped 0.8 per cent in August.

While farm prices fell sharply, prices of industrial commodities - such as metals, lumber and chemicals - which account for 70 per cent of the wholesale price index increased by 0.5 per cent.

Economists consider industrial price changes a better guide to overall inflation trends because they do not fluctuate as wildly as food prices.

White House spokesman, Jody Powell, called the 0.1 per cent rise "another very good performance" but said the administration still thinks the underlying inflation rate is about 6 per cent a year or "a little higher."

Treasury consultant Herman I. Liebling, a lafayette college economist said the three months of rosy wholesale price reports are misleading.

"If these price reports encourage anyone in the belief that the economy is entering a new stage in which price changes will be flat, that belief will quickly be shattered," Liebling warned.

He attributed the good wholesale price performance over the last few months to "temporary declines in food prices."

Those food price declines began showing up on the supermarket shelves in late June and July. Grocery store prices, which had risen sharply early in the year because of cold weather and natural gas shortages, fell by 0.1 per cent in July.

Prices for roods and feeds have been falling at an annual rate of 27.2 per cent during the last three months after rising at a similar clip earlier this year. While this may be good news for consumers, it is bad news for farmers.

White House spokesman Powell noted the "very serious" declines in farm incomes over the last several months. President Carter has proposed reducing wheat production by 20 per cent next year to hold down the supply and boost farm prices.

The Labor Department also reported that the finished goods index rose 0.1 per cent in August, after seasonal adjustment. This index measures price changes in goods which are sold only to final users - those who do not re-sell the goods.

The Labor Department's Bureau of Labor Statistics said it will feature the finished goods index along with the wholesale price index because the finished goods measure eliminates double-counting of price increases among wholesale products.

The Labor Department cited lower wholesale prices for green coffee, cocoa beans, eggs, livestock, grains, and live poultry. The prices of fresh and dried fruits and vegetables rose for the second month in a row.

The biggest increase in industrial commodities prices occurred among wood and lumber products, in large part a reflection of the boom in housing. Patricia R. Harris, Secretary of Housing and Urban Development has asked the White House inflation watchdog, the Council on Wage and Price Stability, to investigate the lumber price increases.

Lumber and wood products prices rose 4.1 per cent in August, after rising 4.2 per cent in July and 1.7 per cent in June.

Chemical product prices fell, while prices rose for nearly all other industrial products, although none as dramatically as lumber prices.

The wholesale price index is based on a collection of 2,700 different commodities. It stood at 194.6 per cent of its 1967 average in August, which means that a collection of goods which cost a businessman $100 in 1967 cost $194.60 last month.