UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   FORM 10-Q


            QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
              EXCHANGE ACT OF 1934

For the quarterly period ended November 30, 1997

                                       or

            TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
              EXCHANGE ACT OF 1934


For the transition period from _____________ to _____________.


Commission File Number:   2-67985


                           FARMLAND INDUSTRIES, INC.
             (Exact name of registrant as specified in its charter)



Kansas                                                              44-0209330
(State of incorporation)                  (I.R.S. Employer Identification No.)

3315 North Oak Trafficway, Kansas City, Missouri                    64116-0005
(Address of principal executive offices)                            (Zip Code)



                                  816-459-6000
              (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.  Yes    No 

                         PART I - FINANCIAL INFORMATION

ITEM 1.     FINANCIAL STATEMENTS

                  FARMLAND INDUSTRIES, INC. AND SUBSIDIARIES

                     CONDENSED CONSOLIDATED BALANCE SHEETS

                                     ASSETS
<TABLE>
<CAPTION>
                                                                  August 31               November 30
                                                                    1997                     1997
                                                                        (Amounts in Thousands)
<S>                                                            <C>                     <C>
Current Assets:
  Accounts receivable - trade...............................   $        589,028        $        635,777
  Inventories (Note 2)......................................            745,301                 776,870
  Other current assets......................................             94,239                 120,414


       Total Current Assets.................................   $      1,428,568        $      1,533,061




Investments and Long-Term Receivables (Note 4)..............   $        266,554        $        272,501



Property, Plant and Equipment:
  Property, plant and equipment, at cost....................   $      1,585,824        $      1,611,877
     Less accumulated depreciation and
     amortization...........................................            802,716                 822,975


  Net Property, Plant and Equipment.........................   $        783,108        $        788,902



Other Assets................................................   $        167,082        $        178,739

Total Assets................................................   $      2,645,312        $      2,773,203


FN>
See accompanying Notes to Consolidated Financial Statements.
</TABLE>


                  FARMLAND INDUSTRIES, INC. AND SUBSIDIARIES

                     CONDENSED CONSOLIDATED BALANCE SHEETS

                            LIABILITIES AND EQUITIES
<TABLE>
<CAPTION>
                                                                           August 31          November 30
                                                                             1997                  1997
                                                                              (Amounts in Thousands)
<S>                                                                   <C>                   <C>
Current Liabilities:
    Checks and drafts outstanding...................................     $       47,243         $     112,817
    Demand loan certificates........................................             50,523                40,792
    Short-term notes payable .......................................            258,342               345,474
    Current maturities of long-term debt ...........................             91,643                92,027
    Accounts payable - trade........................................            366,345               410,889
    Other current liabilities.......................................            372,261               269,608


        Total Current Liabilities...................................     $    1,186,357         $   1,271,607


Long-Term Liabilities:
    Long-term borrowings (excluding current maturities).............     $      580,665         $     606,149
    Other long-term liabilities.....................................             33,480                31,124


        Total Long-Term Liabilities.................................     $      614,145         $     637,273


Deferred Income Taxes...............................................     $        3,974         $       6,584


Minority Owners' Equity in Subsidiaries.............................     $       18,843         $      18,693


Net Income (Note 1).................................................     $           -0-        $      17,333


Capital Shares and Equities:
  Common shares, $25 par value--Authorized
     50,000,000 shares..............................................     $      442,012         $     502,013
    Earned surplus and other equities...............................            379,981               319,700


        Total Capital Shares and Equities...........................     $      821,993         $     821,713




Contingent Liabilities and Commitments (Note 3)





Total Liabilities and Equities......................................     $    2,645,312         $   2,773,203


<FN>
See accompanying Notes to Consolidated Financial Statements.
</TABLE>


                   FARMLAND INDUSTRIES, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
                                                                           Three Months Ended
                                                                   November 30           November 30
                                                                      1996                  1997
                                                                         (Amounts in Thousands)
<S>                                                              <C>                    <C>
Sales.........................................................   $    2,389,279         $    2,283,846
Cost of sales.................................................        2,272,215              2,164,675


Gross income..................................................   $      117,064         $      119,171


Selling, general and administrative expenses..................   $       94,312         $       97,648


Other income (deductions):
   Interest expense...........................................   $      (16,019)        $      (17,109)
   Other, net.................................................            9,131                  7,975

Total other income (deductions)...............................   $       (6,888)        $       (9,134)


Income before income taxes, equity in net income of
    investees and minority owners' interest in
    net loss of subsidiaries..................................   $       15,864         $       12,389

Income tax expense............................................           (3,051)                (2,088)


Income before equity in net income of investees and
    minority owners' interest in net loss
    of subsidiaries...........................................   $        12,813        $       10,301
Equity in net income of investees
   (Note 4)...................................................            10,002                 6,897

Minority owners' interest in net loss
   of subsidiaries............................................             1,077                   135


Net income ...................................................   $        23,892        $       17,333



<FN>
See accompanying Notes to Consolidated Financial Statements.
</TABLE>


                   FARMLAND INDUSTRIES, INC. AND SUBSIDIARIES
               CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                                        Three Months Ended
                                                                                 November 30         November 30
                                                                                     1996                1997
                                                                                      (Amounts in Thousands)
<S>                                                                               <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income..................................................................      $    23,892         $    17,333
Adjustments to reconcile net income to net cash
  provided by (used in) operating activities:
     Depreciation and amortization..........................................           22,822              23,466
     Equity in net (income) of investees....................................          (10,002)             (6,897)
     Other..................................................................            4,843               1,510
    Changes in assets and liabilities:
       Accounts receivable..................................................             (869)            (48,287)
       Inventories..........................................................            6,827             (31,569)
       Other assets.........................................................           22,128             (29,432)
       Accounts payable.....................................................          (23,973)             44,580
       Other liabilities....................................................           42,272             (49,986)

Net cash provided by (used in) operating activities.........................      $    87,940         $   (79,282)


CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures........................................................      $   (30,163)        $   (28,302)
Distributions from joint ventures...........................................           28,868               4,046
Additions to investments and notes receivable...............................          (34,251)             (9,603)
Acquisition of other long-term assets.......................................          (6,947)              (4,415)
Proceeds from disposal of investments and notes receivable..................            1,968               3,673
Proceeds from sale of fixed assets..........................................            4,182               2,982
Other.......................................................................           (3,515)                 -0-
Net cash used in investing activities.......................................      $   (39,858)        $   (31,619)


CASH FLOWS FROM FINANCING ACTIVITIES:
Payments of dividends and patronage refunds.................................      $   (32,459)        $   (40,231)
Payments for redemption of equities.........................................          (25,258)            (28,457)
Proceeds from bank loans and notes payable..................................           88,127             133,342
Payments on bank loans and notes payable....................................         (191,217)            (19,590)
Proceeds from issuance of subordinated debt certificates....................           30,216              17,011
Payments for redemption of subordinated debt certificates...................          (16,493)             (7,017)
Increase of checks and drafts outstanding...................................          101,130              65,574
Net decrease in demand loan certificates....................................           (2,129)             (9,731)
Other ......................................................................                1                  -0-

Net cash provided by (used in) financing activities.........................      $   (48,082)        $   110,901


Net increase in cash and cash equivalents...................................     $        -0-        $        -0-
Cash and cash equivalents at beginning of period............................              -0-                 -0-

Cash and cash equivalents at end of period..................................     $        -0-        $        -0-

<FN>
See accompanying Notes to Consolidated Financial Statements.
</TABLE>


                   FARMLAND INDUSTRIES, INC. AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


(1)  INTERIM FINANCIAL STATEMENTS

      Unless the context requires otherwise, (i) "Farmland" or the "Company"
herein refers to Farmland Industries, Inc. and its consolidated subsidiaries,
(ii) all references herein to "year" or "years" are to fiscal years ended August
31 and (iii) all references herein to "members" are to persons eligible to
receive patronage refunds from Farmland including voting members, associate
members and other patrons with which Farmland has a currently effective
patronage refund agreement.

      In view of the seasonality of the Company's businesses, it must be
emphasized that the results of operations for the periods presented are not
necessarily indicative of the results for a full fiscal year.

      The information included in these Condensed Consolidated Financial
Statements of Farmland reflects all adjustments (consisting only of normal
recurring accruals) which, in the opinion of management, are necessary for a
fair statement of the results for the interim periods presented.

      The Company's revenues, margins and net income depend, to a large extent,
on conditions in agriculture and may be volatile due to factors beyond the
Company's control, such as weather, crop failures, federal agricultural
programs, production efficiencies and U.S. imports and exports.  In addition,
various federal and state regulations to protect the environment encourage
farmers to reduce the use of fertilizers and other chemicals.  Global variables
which affect supply, demand and price of crude oil, refined fuels, natural gas,
livestock, grain and other commodities may impact the Company's operations.
Historically, changes in the costs of raw materials used in the manufacture of
the Company's finished products have not necessarily resulted in corresponding
changes in the prices at which such products have been sold by the Company.
Management cannot determine the extent to which these factors may impact future
operations of the Company.  The Company's cash flow and net income may be
volatile as conditions affecting agriculture and markets for the Company's
products change.

      In accordance with the bylaws of Farmland and its cooperative
subsidiaries, the member-sourced portion of income before income taxes is
determined annually and distributed as patronage refunds to members of Farmland.
The member-sourced portion of such income is determined on the basis of the
quantity or value of business done by Farmland with or for members during the
year.  As this determination is made only after the end of the fiscal year, and
since the appropriation of earned surplus is dependent on the determination of
the amount of patronage refunds, and in view of the fact that the portion of the
annual patronage refund to be paid in cash and in Farmland equity (common stock,
associate member common stock or capital credits) is determined (by the Farmland
Board of Directors at its discretion) after the amount of the annual patronage
refund has been determined, Farmland makes no provision for patronage refunds in
its interim financial statements.  Therefore, the amount of net income has been
reflected as a separate item in the accompanying November 30, 1997 Condensed
Consolidated Balance Sheet.

(2)  INVENTORIES

      Major components of inventories at August 31, 1997 and November 30, 1997
are as follows:

<TABLE>
<CAPTION>
                                         August 31              November 30
                                            1997                    1997
                                                (Amounts in Thousands)
<S>                                  <C>                   <C>
Finished and in-process products......$     625,577        $     638,178
Materials.............................       62,001               87,285
Supplies..............................       57,723               51,407

                                      $     745,301        $     776,870
</TABLE>



(3)  CONTINGENCIES

  (a)  TAX LITIGATION

      In July 1983, Farmland sold the stock of Terra Resources, Inc. ("Terra"),
a wholly owned subsidiary engaged in oil and gas exploration and production
operations, and exited its oil and gas exploration and production activities.
The gain from the sale of Terra amounted to $237.2 million for tax reporting
purposes.

      On March 24, 1993, the Internal Revenue Service ("IRS") issued a statutory
notice to Farmland asserting deficiencies in federal income taxes (exclusive of
statutory interest thereon) in the aggregate amount of $70.8 million.  The
asserted deficiencies relate primarily to the Company's tax treatment of the
$237.2 million gain resulting from its sale of the stock of Terra and the IRS's
contention that Farmland incorrectly treated the Terra sale gain as patronage-
sourced income against which certain patronage-sourced operating losses could be
offset.  The statutory notice further asserts that, among other things, Farmland
incorrectly characterized for tax purposes gains aggregating approximately $14.6
million, and a loss of approximately $2.3 million from dispositions of certain
other assets.

      On June 11, 1993, Farmland filed a petition in the United States Tax Court
contesting the asserted deficiencies in their entirety.  The case was tried on
June 13-15, 1995.  The parties submitted post-trial briefs to the court in
September 1995 and reply briefs were submitted to the court in November 1995.

      If the United States Tax Court decides in favor of the IRS on all
unresolved issues raised in the statutory notice, Farmland would have additional
federal and state income tax liabilities aggregating approximately $85.8 million
plus accumulating statutory interest thereon (approximately $252.3 million
through November 30, 1997), or $338.1 million (before tax benefits of the
interest deduction) in the aggregate at November 30, 1997.  In addition, such a
decision would affect the computation of Farmland's taxable income for its 1989
tax year and, as a result, could increase Farmland's federal and state income
taxes for that year by approximately $5.0 million plus accumulating statutory
interest thereon (approximately $8.5 million), or $13.5 million in the aggregate
at November 30, 1997.  The asserted federal and state income tax liabilities and
accumulated interest thereon would become immediately due and payable unless the
Company appealed the decision and posted the requisite bond to stay assessment
and collection.

      The liability resulting from an adverse decision by the United States Tax
Court would be charged to current earnings and would have a material adverse
effect on the Company.  In the event of such an adverse determination of the
Terra tax issue, certain financial covenants of the Company's Syndicated Credit
Facility (the "Credit Facility"), dated May 15, 1996, become less restrictive.
Had the United States Tax Court decided in favor of the IRS on all unresolved
issues, and had all related additional federal and state income taxes and
accumulated interest thereon been due and payable on November 30, 1997,
Farmland's borrowing capacity under the Credit Facility was adequate at that
time to finance the liability.  However, Farmland's ability  to finance such an
adverse decision depends substantially on the financial effects of future
operating events on its  borrowing capacity under the Credit Facility.

      No provision has been made in the condensed consolidated financial
statements for federal or state income taxes (or interest thereon) in respect of
the IRS claims described above.  Farmland believes that it has meritorious
positions with respect to all of these claims.

      In the opinion of Bryan Cave LLP, Farmland's special tax counsel, it is
more likely than not that the courts will ultimately conclude that Farmland's
treatment of the Terra sale gain was substantially, if not entirely, correct.
Such counsel has further advised, however, that none of the issues involved in
this dispute is free from doubt, and there can be no assurance that the courts
will ultimately rule in favor of Farmland on any of these issues.


  (b)  ENVIRONMENTAL MATTERS

      The Company currently is aware of probable obligations under state and
federal environmental laws at 33 properties.  At November 30, 1997, the Company
has an environmental accrual in its Condensed Consolidated Balance Sheet for
probable and reasonably estimated costs for remediation of contaminated
properties of $16.9 million.  The Company periodically reviews and, as
appropriate, revises its environmental accruals.  Based on current information
and regulatory requirements, the Company believes that the accruals established
for environmental expenditures are adequate.

      The Company's actual final costs of addressing certain environmental
matters are not quantifiable, and therefore have not been accrued, because such
matters are in preliminary stages and the timing, extent and costs of various
actions which governmental authorities may require are currently unknown.
Management is aware of other environmental matters for which there is a
reasonable possibility that the Company will incur costs to resolve.  It is
possible that the costs of resolution of the matters described in this paragraph
may exceed the liabilities which, in the opinion of management, are probable and
which costs are reasonably estimable at November 30, 1997.  In the opinion of
management, it is reasonably possible for such additional costs to be
approximately $18.1 million.

      The environmental accrual discussed above covers certain matters in
connection with which the Environmental Protection Agency has designated the
Company as a potentially responsible party ("PRP") or a responsible party ("RP")
under the Comprehensive Environmental Response, Compensation and Liability Act
("CERCLA"), at various National Priority List ("NPL") sites.

      Under the Resource Conservation Recovery Act of 1976 (''RCRA''), the
Company has three closure and four post-closure plans in place for multiple
locations. Closure and post-closure plans also are in place for three landfills
and two injection wells as required by state regulations. Such closure and post-
closure costs are estimated to be $4.9 million at November 30, 1997 (and are in
addition to the $16.9 million accrual and the $18.1 million discussed in the
prior paragraphs).  The Company accrues these liabilities when plans for
termination of plant operations have been made.  Operations are ongoing at these
locations and the Company does not plan to terminate such operations in the
foreseeable future. Therefore, the Company has not accrued these environmental
exit costs.


 (4) SUMMARIZED FINANCIAL INFORMATION OF INVESTEES ACCOUNTED FOR BY THE EQUITY
METHOD

      Summarized financial information of investees accounted for by the equity
method for the three months ended November 30, 1996 and November 30, 1997 is as
follows:

<TABLE>
<CAPTION>
                                                November 30            November 30
                                                    1996                   1997
                                                      (Amounts in Thousands)
<S>                                           <C>                    <C>
Net sales..................................... $      229,080         $      196,604

Net income.................................... $       20,576         $       14,116

Farmland's equity in net income............... $       10,002         $        6,897
</TABLE>



      The Company's investments accounted for by the equity method consist
principally of 50% equity interests in three manufacturers of crop production
products, Farmland Hydro, L.P., SF Phosphates Limited Company and Farmland
MissChem, Limited (expected to commence production in the third quarter of
fiscal 1998) and a 50% equity interest in a distributor of crop protection
products, WILFARM, LLC.



ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS


      The information contained herein and the Condensed Consolidated Financial
Statements and Accompanying Notes presented in this Form 10-Q should be read in
conjunction with information set forth in Part II, Items 7 and 8, in the
Company's Annual Report on Form 10-K for the year ended August 31, 1997.


FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

     The Company has historically maintained two primary sources for debt
capital: a substantially continuous public offering of its subordinated debt and
demand loan securities (the ''continuous debt program'') and bank lines of
credit.

     The Company's debt securities issued under the continuous public debt
offering generally are offered on a best-efforts basis through the Company's
wholly owned broker-dealer subsidiary, Farmland Securities Company, and through
American Heartland Investments, Inc. (which is not affiliated with Farmland),
and also may be offered by selected unaffiliated broker-dealers.  The types of
securities included in the continuous debt offering include certificates payable
on demand and subordinated debt securities.  The total amount of such debt
outstanding and the flow of funds to, or from, the Company as a result of the
continuous debt offering are influenced by the rate of interest which Farmland
establishes for each type or series of debt security offered and by options of
Farmland to call for redemption certain of its outstanding debt securities.
During the three months ended November 30, 1997, the outstanding balance of
demand certificates decreased by $9.7 million and the outstanding balance of
subordinated debt securities increased $9.9 million.
   
     In May 1996, Farmland entered into a five year Syndicated Credit Facility
(the "Credit Facility") with various participating banks. The Credit Facility
provides a $1.1 billion credit (subject to compliance with certain financial
covenants) consisting of an annually renewable short-term credit of up to $650.0
million and a long-term credit of up to $450.0 million.

     Farmland pays commitment fees under the Credit Facility equal to 1/10 of 1%
annually on the unused portion of the short-term  credit and 1/4 of 1% annually
on the unused portion of the long-term credit. In addition, Farmland must comply
with financial covenants regarding working capital, the ratio of certain debts
to average cash flow, and the ratio of equity to total capitalization, all as
defined in the Credit Facility.  The short-term credit provided under the Credit
Facility is reviewed and/or renewed annually.  The next scheduled review date is
in May 1998.  The revolving long-term credit provided under the Credit Facility
expires in May 2001.

     At November 30, 1997, the Company had incurred $265.5 million of short-term
borrowings under the Credit Facility and $180.0 million of revolving term
borrowings.  Additionally, $65.3 million of the Credit Facility was utilized to
support letters of credit.  At November 30, 1997, under the short-term credit,
the Company had capacity to finance additional current assets of $324.5 million
and, under the long-term credit, the Company had capacity to borrow up to an
additional $264.7 million.

     The Company maintains other borrowing arrangements with banks and financial
institutions. Under such agreements at November 30, 1997, $10.5 million was
borrowed.

     Farmland National Beef Packing Company, L.P. ("FNBPC") maintains borrowing
agreements with a group of banks which provide financing support for its beef
packing operations. Such borrowings are nonrecourse to Farmland or Farmland's
other affiliates (except to the extent of $10.0 million). At November 30, 1997,
$105.0 million was available under this credit facility of which $39.2 million
was borrowed and $0.6 million was utilized to support letters of credit. In
addition, FNBPC has certain long-term borrowings from Farmland. FNBPC has
pledged certain assets to Farmland and such group of banks to support its
borrowings.

     The Company's international grain trading subsidiaries (collectively
referred to as "Tradigrain") have borrowing agreements with various
international banks which provide financing and letters of credit to support
current international grain trading transactions.  Obligations of Tradigrain
under these loan agreements are nonrecourse to Farmland or Farmland's other
affiliates.  At November 30, 1997, such borrowings totaled $59.7 million.

     Leveraged leasing has been utilized to finance railcars and a significant
portion of the Company's fertilizer production equipment.  In December 1997, the
Company entered into a series of agreements which provide for the construction
and operation under a long-term lease of facilities adjacent to the Company's
petroleum refinery at Coffeyville, Kansas.  These facilities are designed to
convert petroleum coke by-products into fertilizers.  When the facilities are
completed in approximately 22 months, Farmland will be obligated to make future
minimum lease payments with an approximate present value of $223 million.
Alternatively, Farmland  has an option to purchase the facilities for a purchase
price equal to the facilities' construction costs less any portion of the
original construction cost previously paid.  In the event Farmland should
default on the obligations described above, future lease obligations may be
accelerated.  If accelerated, obligations due and payable would total
approximately $263 million, all of which would be senior to the subordinated
debt securities and, upon payment of such amount, Farmland would receive title
to the assets.

     In December 1997, the Company sold in a private offering 2 million shares
of 8% Series A Cumulative Redeemable Preferred Shares (the "Preferred Shares")
at $50 per Preferred Share with an aggregate liquidation preference of $100
million ($50 liquidation preference per share).  The Preferred Shares are not
redeemable prior to December 15, 2022.  On and after December 15, 2022, the
Preferred Shares may be redeemed for cash at the option of the Company, in whole
or in part, at specified redemption prices declining to $50 per share on and
after December 15, 2027, plus accumulated and unpaid dividends, if any, thereon.
The Preferred Shares do not have any stated maturity, and are not subject to any
sinking fund or mandatory redemption provisions and are not convertible into any
other securities of the Company.  Proceeds from the issuance of the Preferred
Shares will be used to redeem approximately $50 million of certain members' and
patrons' equity and the balance will be used to repay the principal and
accumulated interest on certain subordinated debt securities.

     In the opinion of management, these arrangements for capital are adequate
for the Company's present operating and capital plans.  However, alternative
financing arrangements are continuously evaluated.

     Net cash from operating activities decreased $166.6 million.  The primary
reasons for this decrease are a $103.9 million decrease in advanced payments by
customers on product (principally plant nutrients) purchases and a $49.4 million
increase in petroleum inventories.  Major uses of cash during the three months
ended November 30, 1997 include:  $79.3 million used in operations;
$40.2 million for patronage refunds and dividends distributed from income of the
1997 fiscal year; $28.5 million for the redemption of equities under the
Farmland base capital and other equity redemption plans and $28.3 million for
capital expenditures.  Major sources of cash include:  $113.8 of proceeds, net
of repayments, from bank loans and other notes payable and $65.6 million from an
increase in the balance of checks and drafts outstanding.

     In 1993, the IRS issued a statutory notice to Farmland asserting
significant deficiencies in federal income taxes and statutory interest thereon.
Farmland filed a petition in the United States Tax Court contesting the asserted
deficiencies in their entirety.  See Note 3 of the Notes to the Condensed
Consolidated Financial Statements.



RESULTS OF OPERATIONS

   GENERAL

     In view of the seasonality of the Company's businesses, it must be
emphasized that the results of operations for the periods presented are not
necessarily indicative of the results for a full fiscal year.  Historically, the
majority of farm supply products are sold in the spring.  Sales in the beef
business and in grain marketing historically have been concentrated in the
summer.  Summer is the lowest sales period for pork products.

     The Company's revenues, margins and net income depend, to a large extent,
on conditions affecting agriculture and may be volatile due to factors beyond
the Company's control, such as weather, crop failures, federal agricultural
programs, production efficiencies and U.S. imports and exports.  In addition,
various federal and state regulations to protect the environment encourage
farmers to reduce the use of fertilizers and other chemicals.  Global variables
which affect supply, demand and price of crude oil, refined fuels, natural gas,
livestock, grain and other commodities may impact the Company's operations.
Historically, changes in the costs of raw materials used in the manufacture of
the Company's finished products have not necessarily resulted in corresponding
changes in the prices at which such products have been sold by the Company.
Management cannot determine the extent to which these factors may impact future
operations of the Company.  The Company's cash flow and net income may be
volatile as conditions affecting agriculture and markets for the Company's
products change.


RESULTS OF OPERATIONS FOR THREE MONTHS ENDED NOVEMBER 30, 1997 COMPARED TO THREE
MONTHS ENDED NOVEMBER 30, 1996

     For the three months ended November 30, 1997, the Company had sales of
$2.3 billion compared with sales of $2.4 billion for the same period last year.
Net income for the three months ended November 30, 1997 was $17.3 million, a
decrease of $6.6 million from the prior year period.

   SALES

     On the input side of the Company's business, sales of the petroleum, crop
production and feed segments in the three months ended November 30, 1997
decreased $38.0 million, $25.1 million and $6.5 million, respectively, compared
with the same period last year.  The decrease in petroleum sales primarily
reflects a decline in unit prices that was partially offset by an increase in
gasoline, distillates and diesel unit sales.  The unit sales increase resulted
principally from higher production volume at the Company's refinery in
Coffeyville, Kansas.  Sales of crop production products decreased due to lower
prices and a decrease in unit volume.  Feed business sales decreased primarily
due to lower feed grain unit sales and prices.

     On the output side of the Company's business, sales in the food processing
and marketing business (the "meats group") increased $66.1 million.  This
increase is primarily attributable to higher unit sales due to an increase in
the number of head processed, partially offset by lower unit prices.  Sales in
the grain business decreased by $102.8 million as a result of both lower unit
volume and lower unit prices.


   NET INCOME

     Net income for the three months ended November 30, 1997 decreased $6.6
million compared with the same period in the prior year.  This decrease was
principally attributable to decreased operating income in the Company's
agricultural input business offset by an increase in the operating income of the
Company's meats group.

     Operating income for the petroleum business decreased $2.3 million for the
three months ended November 30, 1997 compared with the prior period.  This
decline was primarily due to a decrease in the spread between crude oil costs
and refined products selling prices.  This decrease in operating income was
partially offset by improvements at the Company's refinery which increased
processing capacity and which enabled the refinery to process a higher
proportion of sour crude.

     Operating income in the crop production business for the three months ended
November 30, 1997 decreased $15.6 million compared to the same period last year
primarily as a result of decreased unit margins.  The decline of unit margins is
mostly attributable to lower nitrogen fertilizer prices combined with higher raw
material costs (which increased as a result of higher natural gas prices).

     Feed business operating income for the three months ended November 30, 1997
increased $2.9 million compared to the prior period.  This increase primarily
reflects higher margins on formula feeds.

     Operating income in the meats group for the three months ended November 30,
1997 increased $13.6 million compared to the prior period.  This increase is
primarily attributable to increased pork and beef unit margins due to lower live
hog and cattle prices, combined with lower per head selling, general and
administrative costs.

     Grain's operating income for the three months ended November 30, 1997 was
$2.2 million compared to operating income of $2.5 million for the three months
ended November 30, 1996.  The slight decrease is primarily attributable to
weaker margins for feed grains resulting from increased transportation costs.

     Selling, general and administrative ("SG&A") expenses increased
$3.3 million, or 3.5%, from the prior period.  SG&A expenses directly connected
to segments increased approximately $1.4 million and these expenses have been
included in the determination of operating income of the segments.  SG&A
expenses not identified to segments increased $1.9 million, primarily as a
result of increased information service expenses.

     The $1.0 million decrease in the provision for income taxes is primarily
attributable to a decrease in income before taxes.

     The level of operating income in the crop production, petroleum and food
processing and marketing businesses is, to a significant degree, attributable to
the spread between selling prices and raw material costs (natural gas in the
case of nitrogen-based plant nutrients, crude oil in the case of petroleum and
live hogs and cattle in the meats group).  Accordingly, management cannot
determine the direction or magnitude to which these factors will affect the
Company's business.  The Company's cash flow and income may be volatile as
conditions affecting agriculture generally and the costs and markets for the
Company's products change.


YEAR 2000

      The Company has assessed key financial, informational and operational
systems.  Management does not anticipate that the Company will encounter
significant operational issues related to Year 2000.  Furthermore, the financial
impact of making required systems changes is not expected to be material to the
Company's consolidated financial position, results of operations or cash flows.


RECENT ACCOUNTING PRONOUNCEMENTS

      In 1997, the FASB issued Statement No. 130, "Reporting Comprehensive
Income," and Statement No. 131, "Disclosures about Segments of an Enterprise and
Related Information." These statements, which are effective for periods
beginning after December 15, 1997, expand or modify disclosures and,
accordingly, will have no impact on the Company's reported financial position,
results of operations or cash flows.


ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLSOURES ABOUT MARKET RISK

      The information required under Item 3 is not required for the quarterly
period ended November 30, 1997, because the company's market capitalization was
less than $2.5 billion as of January 28, 1997.



CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE
SECURITIES LITIGATION REFORM ACT OF 1995

      The Company is including the following cautionary statement in this
Form 10-Q to make applicable and take advantage of the "safe harbor" provisions
of the Private Securities Litigation Reform Act of 1995 for any forward-looking
statement made by, or on behalf of, the Company.  The factors identified in this
cautionary statement include important factors (but not necessarily all
important factors) that could cause actual results to differ materially from
those expressed in any forward-looking statement made by, or on behalf of, the
Company.

      Where any such forward-looking statement includes a statement of the
assumptions or basis underlying such forward-looking statement, the Company
cautions that, while it believes such assumptions or basis to be reasonable and
makes them in good faith, assumed facts or basis almost always vary from actual
results, and the differences between assumed facts or basis and actual results
can be material, depending upon the circumstances.  Where, in any forward-
looking statement, the Company, or its management, expresses an expectation or
belief as to future results, such expectation or belief is expressed in good
faith and believed to have a reasonable basis, but there can be no assurance
that the statement of expectation or belief will result or be achieved or
accomplished.  Such forward looking statements include, without limitation,
statements regarding the seasonal effects upon the Company's business, the
effect of environmental legislation, the anticipated expenditures for
environmental remediation, the consequences of an adverse judgment in certain
litigations (including the Terra litigation), and the Company's ability to fully
and timely complete modifications and expansions with respect to certain of the
Company's manufacturing facilities.  Discussion containing such forward-looking
statements is found in the material set forth herein under "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
"Notes to Condensed Consolidated Financial Statements".

      Taking into account the foregoing, the following are identified as
important factors that could cause actual results to differ materially from
those expressed in any forward-looking statement made by, or on behalf of, the
Company:

1.Weather patterns (flood, drought, frost, etc.) or crop failure.
  
2.Federal or state regulations regarding agricultural programs and production
  efficiencies.
  
3.Federal or state regulations regarding the amounts of fertilizer and other
  chemical applications used by farmers.
  
4.Factors affecting the export of U.S. agricultural produce (including foreign
  trade and monetary policies, laws and regulations, political and governmental
  changes, inflation and exchange rates, taxes, operating conditions and world
  production and demand).
  
5.Factors affecting supply, demand and price of crude oil, refined fuels,
  natural gas, livestock, grain and other commodities.
  
6.Regulatory delays and other unforeseeable obstacles beyond the Company's
  control that may affect growth strategies through acquisitions and
  investments in joint ventures.
  
7.Competitors in various segments may be larger, may offer more varied products
  or may possess greater financial and other resources than the Company.
  
8.Unusual or unexpected events such as, among other things, litigation
  settlements, adverse rulings or judgments, and environmental remediation
  costs in excess of amounts accrued.
  
9.The factors identified in "Business and Properties - Business - Business Risk
  Factors" included in the Company's Annual Report on Form 10-K for the year
  ended August 31, 1997.

                          PART II - OTHER INFORMATION

ITEM 6.        EXHIBITS AND REPORTS ON FORM 8-K.

   (A)    EXHIBITS

     The exhibits listed below are filed as part of Form 10-Q for quarter ended
November 30, 1997.

        Exhibit No.                         Description of Exhibits   

          27        Financial Data Schedule

   (B)    NO REPORTS ON FORM 8-K WERE FILED DURING THE QUARTER ENDED 
NOVEMBER 30, 1997.

                                   SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                 FARMLAND INDUSTRIES, INC.
                                        (Registrant)


                      By:          /s/  TERRY M. CAMPBELL             

                                     Terry M. Campbell
                                  Executive Vice President
                                  and Chief Financial Officer

Date:   January 14, 1998