Reagan Extends Price Supports to Grain Stored on the Ground : Defends Soviet Wheat Sales in Illinois Address

President Reagan, trying to boost Republican election chances in the Midwest grain belt, offered new aid to farmers today and defended his decision to subsidize wheat sales to the Soviet Union.

In a speech at the Illinois State Fair, Reagan announced that, for the first time, farmers will be able to get price-support loans for grain stored on the ground, as well as in approved storage facilities such as silos or grain elevators.

“With bumper harvests here in the Midwest, storage is scarce and some producers fear lack of space in elevators or farm bins will make their crops ineligible for price-support loans,” Reagan said.

“Farmers need these harvest loans and we intend to see they get them, regardless of problems with storage that are beyond their control,” he added.

Light Applause

The announcement was greeted by light applause.

White House and Agriculture Department officials said they could not estimate how much the decision would cost taxpayers.

Before his speech to a crowd of thousands in the sun-drenched grandstand at the fair, Reagan walked through a livestock display barn--shaking hands and presenting blue ribbons to young men and women who were winners in livestock competitions.

He then traveled 200 miles to Chicago to attend political fund-raisers for Gov. Jim Thompson, seeking a fourth term, and Judy Koehler, trying to win the Senate seat of Democrat Alan Dixon.

Facing ‘Hard Times’

With low prices, sagging agricultural exports and overproduction, Reagan acknowledged in his speech that farmers are facing “some of the hardest of the hard times” despite farm support programs that will cost taxpayers $26 billion this year.

He called his decision to subsidize wheat sales to the Soviets “our most dramatic initiative to expand farm exports.”

Without mentioning Secretary of State George P. Shultz by name, Reagan said, “For some this is difficult to understand; after all, the Soviets are our adversaries. And I’ve never been accused of being naive.

Decision for Farmers

“The truth is, I didn’t make this decision for them; I made it for the American farmer and all Americans. Because if that grain isn’t sold to the Soviets, most of it will be stockpiled, costing the taxpayers and depressing grain prices here at home.”

Reagan said the subsidized grain will be sold “at the same price the Soviets would pay to buy it from one of our foreign competitors. Meeting world competition this way is fair to American taxpayers, fair to our trading partners and, most of all, fair to American farmers.”

The sale, involving 4 million metric tons, has been attacked by Australia, Canada and other grain-exporting countries.