James Brooke, “Soviets Return to the US Grain Market: Purchases May Aid Farmers, Hurt Consumers”,

Wall Street Journal, 6 January 1988


          This article reports the large increase in Soviet purchases of agricultural commodities in 1989 and speculates that the resultant increase in soybean prices could lead to higher meat prices for American consumers.  Not since 1985 had Soviet purchases been at this level, and the almost $1.9 billion spent on U.S. agricultural commodities this fiscal year (1988) is nearly three times the amount spent in the previous year (1987). 


          All of this was forecasted to help farmers greatly, allowing many to turn a profit and maybe even leave the safety net of US farm programs.  But this new increase in Soviet purchases was not expected to be sustained by most.  In fact, the article states, a main reason for the increase in Soviet purchases this year was low US corn prices and that the US government sharply subsidized the Soviet’s wheat purchases.  Soybean purchases were the only commodity purchase that was forecasted to remain at higher levels, due to the USSR’s programs to improve the meat supplies.  This would help US farmers, but how much so depended on the government farm programs.   Although world demand for soybeans had increased steadily during the previous three years (1985 – 1988), US production had shrunk over the same period.  Most analysts, the article reports, agreed that failing to increase production would be a big loss, and many worried that the government was forcing so much land out of production that the US may cut itself out of the world soybean market just as the market was getting good.  Brazil and Argentina, the two other big soybean producers, were expected to increase output the next fall. 


Jeremy Austin Purcell

19 March 2002