The United States opened sensitive agricultural trade talks with its major European allies yesterday, under the gun of possible Reagan administration action to make American farm products more competitive on world markets if the Europeans don't lift their export subsidies.
Although both sides are being quiet about the substance of the talks to avoid the harsh rhetoric that in the past caused fissures in the Atlantic alliance, Reagan administration officials have publicized proposals to stimulate foreign sales of U.S. farm products if the Europeans refuse to change their policies. Any substantial increases in U.S. farm sales likely would result from cuts in sales by other exporting nations such as the Europeans.
The Agriculture Department, pushed by American farm groups and farm-state representatives, argued for action before the talks started to push the Europeans into making concessions, but pulled back under pressure from the State Department.
But U.S. Trade Representative William E. Brock told a news conference at the American Farm Bureau Federation meeting in Dallas that the administration is considering giving surplus grain as a bonus to countries that increase their purchases of American farm goods this year.
Brock said, however, that the proposal might not be implemented if there is progress in the trade talks between the United States and the 10-nation European Economic Community, known as the Common Market.
The talks mark the third time in three months that the Reagan administration finds itself in the midst of a ticklish trade dispute with the European powers that form a cornerstone of the Western alliance. The other disputes concerned the Soviet gas pipeline and steel shipments to the United States.
The current talks are an attempt to smooth over the deep splits that developed between the United States and Europe over agricultural subsidies after November's ministerial meeting of the General Agreement on Tariffs and Trade.
The Common Market nations consider subsidies to their farmers, amounting to about $8.8 billion a year, a key element of the economic community, while the Reagan administration says they give Europeans an unfair advantage in world markets where American farmers have been losing sales.