ILLINOIS GROUP HOPES TO HELP SOVIET FARMING TRANSPORT POSES MAJOR PROBLEM

ILLINOIS GROUP HOPES TO HELP SOVIET FARMING TRANSPORT POSES MAJOR PROBLEM

The Illinois Department of Agriculture is spearheading a move to provide Western assistance to the Soviet Union's beleaguered agricultural industry.

Although nothing is firm, the department is looking to participate in a three-part deal involving itself, the Soviet Union and Doane Agricultural Management Services, a Cherry Hill, Ill., agricultural advisory firm.If the deal goes through as imagined, Doane would manage a Soviet collective farm, using Western technology and farm management techniques to improve productivity.

"They're (Soviet agricultural officials) definitely interested," said Perry Brown, head of international marketing for the Illinois Department of Agriculture. "We're optimistic that something can be worked out."

Mr. Brown, along with representatives of several Illinois companies and the University of Illinois' Agriculture Department, recently returned from what he termed a "fact-finding" trip to two farm collectives about 400 miles southeast of Moscow.

The group identified several areas where Western technology or farm management techniques could easily improve Soviet farm productivity, including fertilization, seed technology and harvesting equipment.

Mr. Brown noted that while the area visited by the group had a 90- to 110-day growing season, the Soviets were using seeds with a 120- to 130-day growing season. Western seed companies, he said, could easily provide more appropriate seeds.

However, the Illinois delegation warned the Soviets that unless they upgrade processing, storage and transport facilities, farm productivity gains would not put more food on the table of the average Soviet.

"If they improve productivity, the processing and transport facilities will be overloaded," said Dale Simpson, a project consultant with Doane Agricultural Management. "They wouldn't be able to make any more cheese or slaughter any more cattle."

In virtually every step of the agricultural production process, Mr. Simpson said, the Soviets lose food. The harvesting equipment is inefficient, causing grain to be left in the fields. Storage facilities are inadequate, causing grain to spoil. And transport over bumpy roads frequently leads to grain falling off trucks.

Given the urgent need to produce food in the Soviet Union, Mr. Simpson doubts whether the Soviets can afford to shut down processing facilities for rehabilitation. Consequently, he believes they will have to build completely new facilities.

"We're talking about major long-term capital investments that have to be made," Mr. Simpson said. "The problem is, where do they get the hard currency to pay for them?"

The question of where the Soviets will get hard currency is also the major problem facing Doane in its efforts to do business with the Soviets.

The Soviets have suggested that Doane export products from its venture to the West. However, poor transportation and inadequate health and hygiene production practices in the Soviet Union work against that possibility, Mr. Simpson said.

"It may be that we will have to be flexible and creative in doing business with the Soviets to get around the hard currency problem," Mr. Simpson said. "Maybe we'll have to look at barter."

Originally, when Doane first met the Soviets, it was prepared to manage a small Western-style model farm. Later, the Soviets asked Doane to consider managing an entire farm collective, consisting of about 300,000 acres.