By design or not, Reagan administration farm-credit policies are pushing many of Mississippi's hard-pressed farmers to the edge of economic ruin.

Planting season is at hand, but uncertainty reigns. Tens of thousands of acres of cropland lie untouched by plows. Seeds and chemicals are not purchased, and plans are on hold as growers await word about loans from the Farmers Home Administration (FmHA).

It's not a household word in the big cities, but FmHA is vital to rural America.

It's the banker of last resort for about one of every 10 farmers, usually marginal or economically shaky growers who can't get year-to-year financing from commercial banks or farmer-run production-credit organizations.

FmHA assumes even more importance in a state like Mississippi, where about 60 percent of 23,000 farmers rely on loans from Uncle Sam, the highest percentage in the country.

With hard times in the farm economy, Congress and the administration have made more loan money available. But there's a block in the pipeline: Administration budget and personnel cuts in FmHA have left a shortage of hands to process loan applications.

Congress has just approved $6.5 million to hire more hands, but for many farmers here it's too late. Fears of foreclosures and voluntary close-out sales, already common every week here, run deep.

Agriculture Secretary John R. Block said in an interview that steps are being taken to beef up FmHA staffing, but he conceded that the sharp personnel cuts that began in 1981 may have had a crippling effect on the agency's ability to make and service loans in timely fashion.

"Unless there's a drastic change, there's no hope for farmers in this area," said Fred Klyce, a private banker who also farms here in Panola County. "Since Mr. Reagan went in, they've made it hard to get FmHA money . . . . If the government called its loans, they'd own 85 percent of Mississippi."

Part of the idleness here has been due to uncertainty over participation in the federal payment-in-kind (PIK) program to reduce crop surpluses and boost prices. Until they learned last week how much land they could remove from production, farmers were slow to put their tractors in the fields.

And while they think the PIK program will help them out of economic doldrums, farmers, agribusinessmen and bankers here say their greatest concerns about farming in 1983 are caused by FmHA loan delays.

President Reagan and Block have insisted that FmHA is on orders to take extra care to help distressed farmers, but reality in Mississippi is something else. FmHA is woefully short-handed.

Budget reductions in 1981 led to dismissal of about 1,200 employes from FmHA's nationwide network. In Mississippi, where at least 170 full-time loan officers have been cut, county branches are caught in a web of paperwork and are weeks and months behind in processing loan requests. Without loan approvals, or with more delays, many of these farmers will be out of business this year.

State FmHA director Pete Perry said he thought farmers' concerns were overstated and that more were getting loan approvals than was commonly believed, although he could provide no statistics. But he agreed that "there is a shortage of personnel now" and said that some of the furloughed loan officers are being rehired, although "it would have been easier to have had these people in place earlier."

But people like Joe Davidson, a Panola County farmer who was an FmHA loan officer until he quit last year, say it's too late--the damage has been done.

"We had five people on this assignment a year ago, and now they're all gone. Farmers are not getting waited on," he said. "FmHA has a policy that forces voluntary liquidations. They don't foreclose on you; they just put you off until you get out of farming."

Similar complaints about FmHA operations have been heard for more than a year across the country. And while officials from Secretary Block on down deny the charges, some farmers and members of Congress continue to allege that the administration is bent on forcing heavily indebted FmHA borrowers out of business.

The issues of farm loan foreclosures and FmHA policy have drawn repeated attention in Congress. It now is working on legislation to assure the leniency that Block says FmHA already exercises in dealing with hard-pressed farmers.

While the economic woes of farming are widely known and debated, and while farm debt since 1970 has risen about 400 percent (to a projected $215 billion this year), the number of farm close-outs nationally has not neared the high levels that many legislators and farm leaders have forecast for months.

FmHA reports that it foreclosed on 844 farmers last fiscal year, out of 270,000 borrowers. And, 6,000 liquidated their loans, 1,245 took bankruptcy under threat of foreclosure and about 3,000 more quit under other stress conditions. One-fourth of FmHA's clients are delinquent in their loan repayments, an ominous sign.

An American Bankers Association survey found that 2.2 percent of the nation's estimated 2.4 million farmers went out of business for various reasons during the year ended last June. Reports from other lending organizations indicate that liquidation rates continued upward last fall and winter.

Block insisted in the interview that the administration has held to a line of leniency in dealing with delinquent borrowers, lending additional money to those who can show a reasonable chance of success if they get their loans. He and FmHA officials calculate that no more than 3 percent of FmHA's borrowers will be foreclosed on.

None of this perspective means much to Mississippi farmers. They despair over continuing low prices for the wheat, soybeans, cotton and rice that are the predominant crops here. They are puzzled that even the best farmers can't seem to make it. They worry about their inability to repay loans and about losing their farms and equipment. And they're furious at the FmHA.

"We don't know what to do," said farmer Davidson. "My father was a sharecropper and I started that way, too. I'm 48 now, and I wonder what went wrong. Did I turn sour? Become lazy? Dumb? I'm scared to death I can't hang in there."

Billy Magee, a heavily indebted farmer from nearby Batesville, said, "I'm 46, farmed all my life. I borrow to pay off my debts. The FmHA will provide some money for me this year, but there are many who won't get help--or they won't get it in time."

At the Oxford Production Credit Association, which lends money to farmers in 10 counties, vice president Charles Rocconi said his farmer-operated agency is "trying to work out any way we can to stay with our borrowers. But land values have dropped 10 to 15 percent, and that affects how long you can go with a man . . . . If things don't get better, I guess from 5 to 10 percent of our borrowers will drop out."

Billy Ross Brown, chairman of the association's board, said, "About 29 percent of our portfolio is 'problem loan' . . . . We have to avoid losses. I think we're on a balance here. The next couple years are critical."

When farmers can't get financing from the commercial banks or the production credit associations, they turn to FmHA. Nationally, the agency accounts for only about 12 percent of U.S. farm credit, but when its clients can't get help at FmHA, they have little other recourse.

H.A. Arnold Jr., who runs a large John Deere equipment agency at Charleston, in Tallahatchie County, said, "No FmHA money has come. What's different here is that they've cut the FmHA staff in half this year . . . . Nine out of 10 farmers who get a loan more than 200 have to come here to pay their bills. We've had no FmHA loan money come through."

Jamie Carpenter, head of the state extension service at Starkville, didn't dwell on farmers' problems in getting FmHA money, but he said this:

"The agricultural outlook here is pretty gloomy. Most budgets here are not even on a break-even basis . . . the only people I've talked to who see any profit are those who can farm without credit. But those are few and far between in Mississippi."

"Being a good farmer ain't the problem," said Edgar M. Hood III, of Tunica, the first of five generations of farmers to borrow operating money.

"I'm with FmHA, but I don't know if I'll get my money," he said. "This year is it for me. Make or break. If Shuman FmHA Administrator Charles W. Shuman wakes up with a hangover, I'm done.

"Nobody around here can get a decision on their FmHA loans. It throws the timing off. The pitiful thing is that they have some very good county supervisors who really try their best."

But a veteran FmHA official at state headquarters in Jackson said the situation is beyond control of the county officers.

"There is no question that we are giving some farmers the runaround. With these low prices and the uncertainty about agriculture, the administration doesn't want to loan money . . . . If you delay and don't make a decision, there's no way a man can farm. You put him out and he'll never understand what hit him. That's the philosophy."

Sen. Thad Cochran (R-Miss.), chairman of the Appropriations subcommittee that oversees FmHA programs, is as perturbed by the situation as his constituents.

"It's inexcusable," he said. "The Office of Management and Budget ought to be given hell for this . . . . There's too little sensitivity in this administration to the farmers' problems."

Cochran said he was distressed by the administration's handling of the rush of loan applications.

"This administration should have demonstrated all along its support of farmers," he said. "They are a traditional Republican constituency. A year ago, the administration should have had a farm-credit initiative, but they sat around and sat around. Hell, the lending season's over now."

The impact of the agency's personnel cuts is clear in places like Sunflower County, whose FmHA office is regarded as one of the best in the state. A year ago, the office at Indianola had eight loan officers. Two weeks ago, it had three.

"It's ridiculous," said Bing Barner, the county supervisor. "I have two of the best assistants there are. We're blessed. But some other county offices have only one person--a supervisor."

Loan activity this year in Barner's office is as brisk as it was in 1982, however. Of the 91 farmers who got loans last year, 64 were still in arrears--which means those cases must be given extra attention. As of two weeks ago, Barner's staff had approved only 41 of 90 new loan applications. And of those 41, only 11 had received their loan money.

Yet for all the gloom and despair, there's still a special kind of spirit gliding over the fertile Delta and the scrubby hill country. Billy Magee, up to his eyebrows in debt, put it this way:

"You know, we wouldn't be here if it wasn't for the FmHA. Some of us may go out, but they can't let us all down . . . . I don't know how, but I'm going to whip this sumbitch."