Andre van Haelst won't argue with the suggestion that there is something wrong with the European Community's agricultural policies.

"There is too much milk, too much wheat, too much meat," the 43-year-old farmer said of the community's enormous surplus production, which last year drained away about $13 billion in price supports.

Showing a visitor his 300-acre farm on the Belgian-Dutch border, where he grows wheat, potatoes, sugar beets, pears and apples, van Haelst recalled that he used to join other farmers at demonstrations in Brussels against what they considered low commodity prices.

"But that was 10 years ago," he said, smiling. "Now we have a real problem. There's too much of everything."

Van Haelst has boosted the output of his own farm in recent years, looking for a greater return on his investments in farm machinery, and needing more money to support his growing family.

But in general, he said, "It was better when we EC farmers produced less. The prices were higher."

The realization that agricultural production must be tamed is widespread in the community today. Faced with increasing demands for money from other sectors of the community, and the expenses that will result from the membership of Spain and Portugal next year, the EC no longer has the funds to continue buying surplus production and bridging the gap between its farmers' prices and those on the world market.

If agricultural output is not slowed, one community official said, "we will be pricing ourselves out of the world market, and our excess will simply pile up automatically in intervention stores."

The official added that were the world market prices of the main EC export products to ease, "this would mean a formidable increase in costs, which we could not afford. A sharp drop in prices would be disastrous."

And while community officials insist that their export subsidies are in line with the rules of the General Agreement on Tariffs and Trade, EC farm surpluses and trade practices have caused serious difficulties with major commercial partners, such as the United States.

The feuding between the EC and the United States escalated recently when the Agriculture Department announced a $2 billion program that would use surplus farm commodities to boost U.S. exports.

The sales are intended to win back the part of the markets the United States has lost through what Agriculture Secretary John R. Block said were the "unfair" trading methods of the EC and other producers.

Reform of the community's farm program, which is known as the Common Agricultural Policy, or CAP, has been at the top of the agenda in Brussels for years. But politically, because of the strong influence of farmers over governments of the member states, the changes have proved extremely tough to introduce.

In the late 1960s, the commission put forward a plan to control production by using financial incentives to reduce the amount of land under cultivation and the number of farmers. The scheme was only adopted in a limited sense, but earned the plan's authors the wrath of farmers and the nickname "the peasant killers."

In recent years, the community has introduced punitive levies to curb excess milk production -- which is still expected to outstrip annual demand by about 11 million tons in coming years -- and reduced guaranteed prices when limits on production have been reached.

But current thinking on CAP reform has centered on prices. Although most of the EC's 8 million farmers maintain they have little margin to accept cuts, community officials argue that significant price reductions are the only effective method of bringing production under control.

This year, agriculture ministers of the 10 member states agreed on a price package for 1985-86 in mid-May, a month and a half after their normal deadline and following several round-the-clock meetings.

At dispute was a combination of modest price cuts for some products and increases for others, representing roughly an overall freeze on prices. In the end, though, concessions were made to ease the reductions for several products.

More significantly, West Germany blocked a 1.8 percent reduction in the key grain price sector, an amount that community officials said was merely a token cut, given estimates that the EC grain surplus will average 33 million tons annually until 1990.

The urgency of decreasing production was underscored by an estimate this month by the International Wheat Council that world wheat production in 1985-86 will be a record 524 million tons.

One U.S. official in Brussels said of the price package: "I'm not impressed." He added that leaving the responsibility for adopting price reforms in the hands of EC agriculture ministers was "like putting the fox in charge of the chicken coop."

On June 12, West Germany once again blocked agreement on a cereals price reduction, formally invoking a community rule that allows one member state to veto the decision of the others.

The European Commission, the community's executive body, which proposed the price cuts, decided a week later to enforce the 1.8 percent grain price reduction temporarily. The commission has argued that since it is charged with the efficient management of the agriculture markets, it must go ahead with the price cut to discourage farmers from selling their grain now in hopes of avoiding price reductions in the future. The issue appears to be headed for the European Court of Justice.

Frans Andriessen, the community commissioner, said the grains issue threatens the credibility of the community's agriculture policies, "not ony in the eyes of the European public, but also vis-a-vis our international trading partners."

In the meantime, the commission is undertaking yet another review of agricultural policies, and Andriessen has suggested several longer-term proposals to help restrain production and increase demand.

One would be to shift a substantial part of the agricultural spending from price supports to direct income aids for farmers, in the hope that they then would feel secure enough to accept major price cuts.

To boost exports, Andriessen said, the community could begin using export credits, longterm supply agreements and linkage between commercial exports and food aid.

Andriessen said the community was determined to maintain its position on the world market, and would continue to use export refunds and import levies in trade and give preference to community products.