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                                  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 Act of 1934

   For the quarter ended                        Commission File No. 0-13403
   March 31, 1998
--------------------------------------------------------------------------------

                               AMISTAR CORPORATION
             (Exact name of registrant as specified in its Charter)
--------------------------------------------------------------------------------

              STATE OF CALIFORNIA                               95-2747332
(State or other jurisdiction of Incorporation               (I.R.S. Employer
             or organization)                               Identification No.)

               237 VIA VERA CRUZ                                   92069
            SAN MARCOS, CALIFORNIA                               (Zip Code)
   (Address of principle executive offices)

                                 (760) 471-1700
              (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 x  No
                                             ---   ---


          CLASS                                       OUTSTANDING AT MAY 8, 1998

Common Stock $.01 Par Value                                    3,236,500

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Part 1.
Item 1. Financial Statement

                               AMISTAR CORPORATION
                                AND SUBSIDIARIES
                            Condensed Balance Sheets
                                 (In thousands)

                                                      MAR 31,*         DEC. 31,
                                                       1998             1997
                                                   ------------     ------------

ASSETS
Current assets:
  Cash                                             $     2,614      $     2,521
  Trade accounts receivable, net                         5,784            5,574
  Inventories                                            5,371            5,327
  Demonstration equipment                                  303              531
  Prepaid expenses                                         234              272
  Deferred income taxes                                    695              695
                                                    ------------    ------------
  Total current assets                                  15,001           14,920

Property & equipment, net                                5,377            5,146

Contracts receivable                                       474              700
Restricted cash                                          1,329            1,329
Other                                                      209              141
                                                   ------------     ------------
                                                   $    22,390      $    22,236
                                                   ============     ============

LIABILITIES & SHAREHOLDERS' EQUITY Current liabilities:
  Accounts payable & accrued liabilities           $     1,976      $     2,072
  Income taxes payable                                     289              216
                                                   ------------     ------------
Total current liabilities                                2,265            2,288

  Industrial development bonds                           4,500            4,500

Shareholders' equity
  Common stock                                              32               32
  Additional paid in capital                             4,843            4,843
  Retained earnings                                     10,750           10,573
                                                   ------------     ------------
  Total shareholders' equity                            15,625           15,448
                                                   ------------     ------------

                                                   $    22,390      $    22,236
                                                   ============     ============

* Unaudited
See accompanying notes to financial statements.

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                                AMISTAR CORPORATION
                                  AND SUBSIDIARIES
                          Condensed Statements of Earnings
                 (Unaudited and In thousands, except share amounts)

 Three months ended March 31,                      1998               1997
--------------------------------------------------------------------------------

Net sales                                     $       5,306       $       6,415

Cost of sales                                         3,575               4,105
                                              --------------      --------------

Gross profit                                          1,731               2,310

Operating expenses:
  Selling                                               875               1,132
  General & administrative                              290                 266
  Research & development                                297                 388
                                              --------------      --------------
                                                      1,462               1,786
                                              --------------      --------------

Earnings from operations                                269                 524

Other income, net                                         3                  37
                                              --------------      --------------

Earnings before income taxes                            272                 561

Income taxes                                             95                 225
                                              --------------      --------------

Net earnings                                  $         177       $         336
                                              ==============      ==============

Basic and diluted earnings
  per common share                            $        0.05       $        0.10
                                              ==============      ==============

Weighted average shares
  outstanding                                     3,236,500           3,235,250
                                              ==============      ==============

See accompanying notes to financial statements.

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                             AMISTAR CORPORATION
                               AND SUBSIDIARIES
                           Statements of Cash Flows
                         (Unaudited and In thousands)

Three months ended March 31,                           1998             1997
-------------------------------------------------------------------------------

Cash flows from operating activities:
  Net earnings                                      $     177        $     336

  Adjustments to reconcile net earnings to net
  cash provided by operating activities:
  Depreciation & Amortization                             169              133
  Gain on sale of equipment                               (12)             (39)

  Changes in assets & liabilities:
    Accounts receivable, net                             (210)             825
    Inventories                                           297             (602)
    Demonstration equipment                              (113)              52
    Prepaid expenses & other assets                       (30)            (120)
    Contracts receivable                                  226               69
    Accounts payable & accrued liabilities                (96)             (97)
    Income taxes payable                                   73              180
                                                     ---------       ----------

Cash provided by operating activities                     481              737

Cash flows from investing activities:
  Capital expenditures                                   (400)            (358)
  Proceeds from sale of equipment                          12               39
                                                    ----------       ----------
                                                         (388)            (319)
Cash flows from financing activities:
  Common stock issued for stock options                     -               14
                                                    ----------       ----------

Net increase (decrease) in cash                            93              432
Cash at the beginning of the period                     2,521            1,892
                                                    ----------       ----------
Cash at the end of the period                       $   2,614        $   2,324
                                                    ==========       ==========

Supplemental disclosure of cash flow information

  Cash paid during the period for:
    Interest                                        $      44        $      42
    Income tax                                      $      22        $      55

See accompanying noates to financial statements.

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                               AMISTAR CORPORATION
                                AND SUBSIDIARIES

                     Notes to Condensed Financial Statements

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation
---------------------

   The Interim Consolidated Condensed Financial Statements of Amistar
Corporation, a California corporation, and subsidiaries (the "Company") have
been prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in the financial statements prepared in
accordance with generally accepted accounting principles have been omitted
pursuant to such rules and regulations. These Interim Consolidated Condensed
Financial Statements should be read in conjunction with the audited financial
statements and notes thereto included in the Company's 1997 annual report on
Form 10-K as filed with the Securities and Exchange Commission on March 25,
1998.

Inventories
-----------

   Inventories are stated at the lower of cost (first-in, first-out) or market
and include material, labor and manufacturing costs. Inventories consist of the
following (in thousands):

                                          Mar 31,              Dec. 31,
                                           1998                  1997
                                       ------------          ------------
Raw Material                           $       913           $       884
Work In Process                              2,686                 2,670
Finished Goods                               1,772                 1,773
                                       ============          ============
                                       $     5,371           $     5,327
                                       ============          ============

Comprehensive Income
--------------------

   As of January 1, 1998, the company adopted Statement of Financial Accounting
Standards No. 130 "Reporting Comprehensive Income" ("SFAS 130"). SFAS 130
establishes new rules for the reporting and display of comprehensive income and
its components. The adoption of SFAS 130 has no impact on the Company's net
income or shareholders' equity. For the three months ended March 31, 1998 and
1997, comprehensive income equaled net income.

                                       5
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                               AMISTAR CORPORATION
                                AND SUBSIDIARIES

               Notes to Condensed Financial Statements, Continued

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

Forward Looking Statements
--------------------------

     This Quarterly Report, contains forward-looking statements within the
meaning of the Private Securities Reform Act of 1995, particularly statements
regarding market opportunities, customer acceptance of products, gross margin
and marketing expenses. These forward-looking statements involve risks and
uncertainties, and the cautionary statements set forth below, identify important
factors that could cause actual results to differ materially from those in any
such forward-looking statements. Such factors include, but are not limited to,
adverse changes in general economic conditions, including changes in the
specific markets for the Company's products, product availability, decreased or
lack of growth in the electronics industry, adverse changes in customer order
patterns, increased competition, lack of acceptance of new products, pricing
pressures, lack of success in technological advancements, risks associated with
foreign operations and other factors.

RESULTS OF OPERATIONS

Net Sales
---------

    Net sales for the three months ended March 31, 1998, were $5,306,000
compared to $6,415,000 for the same period in the prior year. Machine sales have
been affected by customer delays in accepting additional units while awaiting
newer models, limited acceptance in certain sectors of the contract assembly
market, the effects of oversupply in the memory module industry and the
intensifying of competition.

    The first two factors mentioned above are expected to continue until the
third quarter when the Company expects to receive the newest technology pick and
place machine from its offshore supplier. At that time, the Company expects the
new model to appeal to a broader sector of the market and satisfy delayed orders
from its current customer base.

Gross Margin
------------

    Gross margin for the current quarter decreased as a percentage of sales due
to higher manufacturing variances related to re-costing the Company's line of
machine feeders. In addition, the Company increased management and support
personnel related to expansion of the Manufacturing Services Division.

Sales, General and Administrative
---------------------------------

    Selling expenses declined in the current quarter primarily due to lower
commission expenses which related to lower sales. Research and development
expenses decreased in the current quarter due to the recent conclusion of
several development projects.

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                               AMISTAR CORPORATION
                                AND SUBSIDIARIES

               Notes to Condensed Financial Statements, Continued

LIQUIDITY AND CAPITAL RESOURCES

    The Company generated cash from operating activities totaling $481,000 for
the current quarter. Contracts receivable decreased and accounts receivable
increased primarily due to reclassification of a contract to accounts
receivable. Demonstration equipment decreased $228,000 primarily related to
transfers to inventory from the Company's former European facility. Expenditures
for the current quarter, for property and equipment were $400,000, and primarily
consisted of surface mount machines for the Manufacturing Services Division
expansion.

PART II.

Items 1-6 Non-Applicable

    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.

                                                   AMISTAR CORPORATION

                                                   By:/s/ William W. Holl
                                                      -----------------------
                                                      William W. Holl
                                                      Vice President - Finance
                                                      Chief Accounting Officer &
                                                      Duly Authorized Officer

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