The Carter administration is preparing a plan to combat the growing surplus of unsold U.S. wheat by idling millions of acres of productive farmland, starting this fall.
Sources said an announcement of the first major land retirement program since 1973 could come soon, and in no case can be delayed much past the end of the month. About three-quarters of the country's annual wheat crop is sowed in September and October, and wheat farmers from Texas to the Dakotas are now making final planting preparations.
Administration officials are aware of the humanitarian arguments against such a cutback in food output, given the persistence of world hunger. But they say the surplus is reaching such proportions that steps must be taken urgently to prevent the stockpiles from becoming unmanageable and more costly to taxpayers.
About 30 million metric tons of wheat harvested in 1976 - about half the U.S. crop - still have not been sold, and U.S. wheat farmers have just brought in another bumper crop of nearly 60 million additional tons.
This surplus, combined with good harvests and ample stocks abroad, have driven U.S. wheat prices in some locations down to $2 a bushel, the lowest level in five years.
A four-year farm bill that will to to the President soon guarantees wheat farmers up to $3.10 a bushel, starting next year. Agricultural planners say that production cutbacks should help revive the sluggish wheat markets, raise wheat prices, and reduce the amount of money the government has to pay wheat farmers in 1978. A number of countries, such as Argentina and Turkey, have been underselling the United States in would markets. Congressional source said yesterday that there is solid support for the administration plan. They said the plan will signal to other countries the United States' refusal to hold a food reserve for the would in the form of unsold grain.
The plan being worked out at the Department of Agriculture would not order the wheat groweers to plant fewer acres, but it would give them strong incentives to do so. Farmers who did not voluntarily reduce their plantings would be ineligible for price supports and government payments. They would also be ineligible for those benefits if they planted other crops, such as corn or soybeans, on the idle acreage.
For this year's crop, farmers planted 74.4 million acres of wheat and harvested 65.6 million acres. Sources said it was likely that the cutbacks would be from 12 million to 17 millionacres. Reductions of that magnitude would decrease the size of the country's wheat crop to 45 million or 50 million tons.
Wheat surpluses have been a problem for Republican and Democratic administrations alike since the early 1950s. Agriculture Secretary Earl ,. Butz was sharply criticized for idling land in 1973, the year when severe grain shortages set off the world food crisis of 1973 and 1974.
Butz answered his critics by saying the Republican administration was getting the government out of grain markets and saving taxpayers billions of dollars in storage costs. In the 1950s and 1960s, the government accumulated millions fo tons fo grain through the price support program.
Butz and the Republican succeeded in getting rid of the vast government stocks. But the previous administration was never put to the test of falling grain prices and large surpluses, as the Carter adiministration now is.
So far, lthe government has avoided acquiring large amounts of grain, but that possibility could arise next year if surpluses continue.
Farmers pawned to the government more than 10 million tons of wheat harvested in 1976 under the price support program. The government gave those farmers loans and accepted the wheat as collateral. Starting next year, the farmers will have the option of forfeiting the wheat and keeping the loan money.
However, a new administration program gives incentives to farmers to extend those loans and to contract with the government to store the grain until prices in the marketplace reach more profitable levels. In that way, the administration hopes that the government can avoid owning the grain.