The Reagan administration agreed today to provide an additional 15 million tons of grain to the Soviet Union over the next 12 months, boosting to a record level the availability of American wheat and corn to offset a poor harvest here.
Undersecretary of Agriculture Seeley Lodwick announced the agreement following two days of talks with senior Soviet officials. It raises to 23 million tons the amount available to the Soviet Union for the fiscal year starting today. At today's prices, 11.5 million tons of wheat and an equal tonnage of corn would be worth nearly $3 billion.
The Soviets have already purchased 7.7 million tons of grain for delivery under the 8-million-ton ceiling set by a previous long-term sales agreement covering the period.
U.S. officials said the largest previous Soviet purchase of American grain in a single crop year was 15.5 million tons in the 1978-79 period.
Former president Carter slapped a partial embargo on grain exports to the Soviet Union following the Soviet occupation of Afghanistan in December 1979. The ban exempted 8 million tons previously contracted under a five-year agreement that had been extended still another year.
President Reagan ended the partial embargo earlier this year, in keeping with his election campaign statements last fall that the ban was unfair to farmers.
Carter's cancellation of contracts for 17 million tons of grain -- above the exempted 8 million tons -- was the first significant use by the United States of food sales as a weapon in foreign policy. It was widely argued in Washington that the lifting of the restriction would send a wrong signal to Moscow.
Soviet negotiators are believed to have sought assurances from the U.S. side that unforeseen political developments would not lead to a new embargo.
U.S. officials briefing journalists here would not disclose whether any political considerations were raised. Lodwick had met, among others, Foreign Trade Minister Nikolai Patolichev and his deputy, Boris Gordeev.
In a prepared statement, Lodwick said it was his "best judgment" that the Soviets would purchase about 10 million additional tons, bringing the total U.S. exports to the Soviet Union to 18 million tons for the crop year.
Another official said later that the Soviets may take all available American grain if Argentina has a below-average harvest, as is expected.
The Soviets imported a record 34 million tons of grain last year after a disappointing harvest of 190 million tons. Latest estimates are that this year's harvest may fall below 180 million tons. This would mean that for the third year in a row the Soviet harvest would fall 40 million to 50 million tons short of the 1978 grain harvest of 236 million tons.
During the past two years the Soviets have been trying to diversify their food import sources. They bought almost 8 million metric tons of grain from Argentina and recently concluded an agreement with that country to import $1 billion worth of Argentine meat over the next five years.
Moscow also signed an agreement with Brazil to buy 2.5 million tons of soybeans and the same amount of corn over a five-year period. Similar purchases are being negotiated with Canada, Australia and several other countries.
Washington Post staff writer Dan Morgan added in Washington:
Private experts do not expect the agreement to have much impact on grain prices, and ultimately food prices, in the United States. Traders had been expecting an agreement by the U.S. government to sell additional grain to the Soviets, and the suggestion that the Soviets will not purchase the full amount authorized caused the grain markets to weaken somewhat at the close of trading.
American farmers are completing their harvest of large corn and soybean crops, and a record wheat crop was brought in earlier this year.
Experts feel this provides an adequate cushion against price inflation here, even if there is poor weather or crop failures elsewhere over the next 12 months.