COLUMN ONE : Nicaragua’s Main Crop Is Turmoil : President Chamorro needs farm exports to revive the economy. But ‘counterreforms’ are stirring labor unrest, and production targets are threatened.

It was payday on this state-owned rice farm, but that was just half the excitement. A mysterious Cessna, the first aircraft seen up close in years, circled low over the flat green fields, dropped a small plastic bag and disappeared into the overcast.

“ Saludos to everyone in Cuatro Palos,” a handwritten note in the bag said. It was signed “Iliana, Klaus, Juergen, Peter, Tom and Inge.”

Older field hands understood at once, and word spread quickly: Klaus Sengelmann, minister of agriculture in the dictatorship toppled 11 years ago by the Sandinista guerrillas, was back from exile with his entire family to reclaim their plantation.

The sensation that Sengelmann caused, without even setting foot on the land, is a sign of the unsettled times in rural Nicaragua as the elected government inaugurated in April moves to dismantle the Sandinistas’ land reform program. After 146 of his former employees signed a petition begging Sengelmann to come back, 15 were fired by the Sandinistas who still run Cuatro Palos and are determined to keep it.

President Violeta Barrios de Chamorro drew the battle lines May 11 with two strokes of a pen. One decree set up a five-member board to restore property rights of Nicaraguans dispossessed by the Sandinistas in the name of the landless rural poor. The other decree allows state farms to be rented out to private managers while the claims, already numbering more than 1,000, are reviewed.

The “counterreform” decrees have met stiff resistance from the Sandinista-run Farm Workers Assn., which has a stake in managing the state farms. Armed union activists seized at least 32 private plantations last month, disrupting cultivation of cotton and coffee, the country’s most valuable exports.

The ideologically charged dispute is less visible than the Sandinista-led civil servants’ strike that brought the government to a six-day standstill last month, but it is potentially more costly: Chamorro’s plans to revive the economy depend on a boom in farm exports.

Nicaragua’s cool mountain valleys and steaming coastal plains are bursting into life with the start of the six-month rainy season. This year’s greening comes with two good omens--settlement of the eight-year Contra war and a renewal of U.S. aid, a $300-million package that will boost farm credit by $10 million.

But farmers and agriculture specialists interviewed recently in Managua and four northern provinces--Leon, Chinandega, Esteli and Matagalpa--warn that production targets for cash crops and basic grains are threatened by Sandinista labor unrest on the larger farms and uncertainty over the survival of smaller ones.

“The new government seems determined, at any cost, to bring back the bourgeois capitalists, the people it is counting on to get this country going in the long run,” said Paul Rice, an American economist in Esteli who worked for the Sandinistas’ Agrarian Reform Ministry. “Changing the rules of the game to get these people back seems more important to (Chamorro) than having a good crop year.”

Land reform was a cornerstone of the Sandinista revolution and a flash point of conflict in the Contra war. Thousands of acres were confiscated from the deposed dictator Anastasio Somoza, members of his family and his allegados , a term stretched to dispossess anyone vaguely associated with him. Other properties were seized because they were judged to be unproductive or because the owners had left Nicaragua, joined the rebels or simply criticized the Sandinistas.

About half the peasants in Nicaragua became landowners under the reforms. Most of them, about 110,000, were organized into cooperatives now covering 20% of all farmland. Plantations kept by the state, which make up 13% of the land, are managed with active participation by Sandinista unions representing 60,000 permanent field hands. Both kinds of farms were armed against the Contras.

Under the new free-market regime, Chamorro’s advisers say, all state farms will be privatized over the next two years except those that once belonged to the Somoza family or to people who depended on Somoza financially.

Land occupied by co-ops will not be returned as long as they are productive, the officials say; former owners will be compensated. But after years of Sandinista debt writeoffs that amounted to subsidies, the co-ops are being told to swim or sink financially.

To ease the uncertainties caused by years of hyperinflation, the government is promising all farmers world market prices and stable interest rates of 13% to 15% a year. Both are being calculated in a still-to-be-issued new currency, the gold cordoba, that will start out trading on a par with the dollar.

But farmers interviewed at co-ops said nobody has explained how they are supposed to make a profit in the new currency, especially with inflation still rampant. Many said they are convinced that the government wants the co-ops to fail so it can repossess their land and sell to big landowners.

“If they try to do that, we’ll fight,” said Mercedes Arce, president of the Noel Gamez cattle and grain co-op in Esteli. The 11 families there all own assault rifles.

Like other co-ops, Arce’s is cutting its acreage to minimize indebtedness. As a result, the planting of corn, beans and other grains for the home market is slightly diminished from last year across Nicaragua, despite an officially estimated 20% increase in sown acreage for all crops.

The government is more concerned about boosting farm exports. Last month the Agriculture Ministry forecast a doubling of cotton output and smaller increases for sugar, tobacco and bananas. But officials now admit that the seizure of plantations has shaken the confidence of big growers.

“We have warned the Farm Workers Assn. that their anti-democratic, inflexible attitude--taking over farms at the start of the crop cycle--could endanger the country’s future,” Agriculture Minister Roberto Rondon said in an interview. “If there is a situation of instability, the producer will not invest, and we need his investment to come out ahead.”

In the last week of May, the union paralyzed 12 private farms in Leon and Chinandega that produce 10% of Nicaragua’s cotton and 20 private coffee plantations in Matagalpa with slightly less acreage.

Uncertain of her control over the Sandinista-led police, the president ordered the conflicts settled by negotiation. Most of the strikes have ended with short-term wage increases.

Juan Jaime Deshon, a leader of the Cotton Growers Assn. in Chinandega, said that two out of five producers cannot afford the new labor costs of $2 a day per worker. He estimated that the annual sowing of cotton, instead of doubling from last year’s 28,800 acres, will not exceed 43,200 acres nationwide.

“Some producers are already complaining that things were more stable under the Sandinistas,” Deshon said.

Coffee growers in Matagalpa say labor unrest could cut their production this year.

One wealthy producer, Julio Rivera, refuses to negotiate with the 16 armed union activists enforcing a strike at his 105-acre farm and is resigned to leaving it in their control. He has turned down Chamorro’s offer to head the national coffee marketing institute.

“If the police cannot get these vagrants off my land, how am I going to manage the production of the whole country?” he asked bitterly. “Dona Violeta has to take a hard line. If this scandal continues, what use is the $300 million (in U.S. aid)?”

Most of the action against private farms is led by union activists from nearby state plantations. Arguing that Chamorro listens to the big private owners, the union has threatened to hold two of their farms hostage for every state farm given away.

At stake for the state farm workers are schools, day-care centers, health services, subsidized food prices and steady employment--Sandinista-era benefits they fear losing now. State farms offer better living conditions and are generally more productive, the union contends.

“The new decrees were written by people with the mentality of cavemen,” said Farm Workers Assn. President Edgardo Garcia. “Behind them is an interest in striking a deep blow to the working class.”

Here at Cuatro Palos, the rhetoric of class struggle doesn’t quite fit and the issues aren’t so simple.

Klaus Sengelmann, who managed the 865-acre plantation for his German-immigrant family, is denounced by union leaders as a “bloodsucker” and a Somocista . But workers’ opinions are divided. Some say he never paid overtime or Christmas bonuses. Others remember him as a benevolent boss who flew the sick to hospitals. Some of these workers hate their Sandinista bosses for forcing them to join the army.

Duilio Baltodano, head of the new property claims board, says that Sengelmann made his money independently of Somoza and cannot be denied his land for having served in the dictator’s Cabinet.

“He’s the kind of honest, hard-working entrepreneur we need in Nicaragua,” said Rondon, the agriculture minister.

Does that mean the plantation and its workers will be better off under the former owner?

Antonio Delgado, the Sandinista who has run Cuatro Palos since 1981, admits that Sengelmann paid comparable wages and that the farm needs a subsidy to operate now. But he has expanded acreage, doubled Sengelmann’s payroll to 200 permanent workers, allowed them to own milk cows and built a day-care center.

Fearing a loss of those benefits, the union has vowed to bar Sengelmann from the property.

“We’ll seize the farm and run it ourselves,” union leader Francisco Altamirano said.

After the Cessna swooped down here May 5, Sandinista news media reported that Sengelmann had tossed down wristwatches and money to bribe his way back. In fact, it was his brother, Juergen, who made the flight and dropped only a bag of clothing for the family’s former maid.

Klaus Sengelmann, who manages a rice mill in Florida and is secretary of the Florida Rice Council, visited Nicaragua last month but stayed clear of the farm.

“I was anxious to drive out there and talk to the workers, but I didn’t want to stir up any more trouble,” he said in an interview. “I really don’t know what’s out there. I don’t know whether the farm can still make a profit and keep so many people employed. I see a risk of anarchy, but we’re willing to look at it.”