U.S. SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549

                                  FORM 10-KSB
(Mark One)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934]

     For the Fiscal Year Ended August 31, 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: 0000927536

                     ALLIANCE FARMS COOPERATIVE ASSOCIATION
                 (Name of small business issuer in its charter)

            COLORADO                            84-1270685
(State or other jurisdiction        (I.R.S. Employer Identification No.)
of incorporation or organization)

                   302 IDLEWILD STREET, YUMA, COLORADO  80759
           (Address of principal executive offices)       (Zip Code)

                   Issuer's telephone number:  (970) 848-3231

         SECURITIES REGISTERED UNDER SECTION 12(B) OF THE EXCHANGE ACT:

                                                    Name of Each Exchange
            Title of Each Class                       on Which Registered

                     None                                        N/A

         SECURITIES REGISTERED UNDER SECTION 12(G) OF THE EXCHANGE ACT:

                                      None

                                (Title of Class)

     CHECK WHETHER THE ISSUER (1) FILED ALL REPORTS REQUIRED TO BE FILED BY
SECTION 13 OR 15(D) OF THE EXCHANGE ACT DURING THE PAST 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 [  ]

     CHECK IF THERE IS NO DISCLOSURE OF DELINQUENT FILERS IN RESPONSE TO ITEM
405 OF REGULATION S-B CONTAINED IN THIS FORM, AND NO DISCLOSURE WILL BE
CONTAINED, TO THE BEST OF REGISTRANT'S KNOWLEDGE, IN DEFINITIVE PROXY OR
INFORMATION STATEMENTS INCORPORATED BY REFERENCE IN PART III OF THIS FORM 10-KSB
OR ANY AMENDMENT TO THIS FORM 10-KSB. [X]

     STATE ISSUER'S REVENUES FOR ITS MOST RECENT FISCAL YEAR:  $13,669,706.

     THE AGGREGATE MARKET VALUE OF THE VOTING STOCK OF THE ISSUER HELD BY NON-
AFFILIATES COMPUTED BY REFERENCE TO THE OFFERING  PRICE FOR THE ISSUER'S COMMON
STOCK IN THE ISSUER'S ONGOING PUBLIC OFFERING AS OF  NOVEMBER 25, 1997, IS
$2,660,000.  AS OF NOVEMBER 25, 1997, THE ISSUER HAD 119 SHARES OF CLASS A
COMMON STOCK, PAR VALUE $0.01 PER SHARE, AND 36 SHARES OF CLASS B COMMON STOCK,
PAR VALUE $0.01 PER SHARE, OUTSTANDING.

                      DOCUMENTS INCORPORATED BY REFERENCE

     None

     TRANSITIONAL SMALL BUSINESS DISCLOSURE FORMAT:  YES [  ]    NO [X]

                                     PART I


ITEM 1.  DESCRIPTION OF BUSINESS.


GENERAL

     Alliance Farms Cooperative Association ("Alliance" or the "Company") is a
cooperative association engaged in the production of feeder pigs for sale to its
members who own shares of its Class A Common Stock, and intends to engage in the
production of weaned pigs for sale to its members who own shares of its Class B
Common Stock or Class C Common Stock.  The Company was formed as a cooperative
association under the laws of the state of Colorado on May 3, 1994, but did not
engage in any business activity until July, 1994.  The Company's predecessor,
Yuma Feeder Pig Limited Liability Company ("Yuma LLC"), was formed in October,
1991 and commenced shipment of feeder pigs from its 2,450-sow feeder pig
production facility in March, 1993.  On July 13, 1994 (July 9, 1994 for
accounting purposes), the Company acquired the entire equity ownership rights
and interests in Yuma LLC from Farmland Industries, Inc. ("Farmland") and Yuma
Farmers Milling and Mercantile Cooperative Company ("Yuma Cooperative"), and
thereupon Yuma LLC was dissolved and liquidated and its assets, liabilities and
feeder pig production operations were assigned to and assumed by Alliance.

     The Company's principal executive offices are located at 302 Idlewild
Street, Yuma, Colorado 80759, and its telephone number is (970) 848-3231.
Unless the context otherwise requires, the terms "Alliance" and the "Company,"
as used in this report, refer to Alliance Farms Cooperative Association and its
predecessor, Yuma LLC.

DESCRIPTION OF BUSINESS

     GENERAL.  The Company is a cooperative association engaged in the
production of feeder pigs for sale to its members who own shares of its Class A
Common Stock, and intends to engage in the production of weaned pigs for sale to
its members who own shares of its Class B Common Stock or Class C Common Stock.
As of August 31, 1997, the Company owned and operated five 2,450-sow feeder pig
production facilities located in Yuma County, Colorado (approximately 150 miles
east of Denver), one 2,450-sow feeder pig production facility located in Wayne
County, Illinois (approximately 100 miles east of St. Louis, Missouri), and was
in the process of developing one additional feeder pig facility of comparable
size in Wayne County, Illinois.  As of the date of this report, the Company has
commenced preliminary development activities with respect to a sixth 2,450-sow
facility in Yuma County, Colorado.  See "Description of Business--Expansion" and
"Description of Property" under Item 2.

     The Company's business strategy is to produce feeder pigs and weaned pigs
for sale to its members at competitive prices by utilizing modern facilities,
management practices designed to maximize productivity and high quality
genetically consistent breeding stock.  The Company intends to expand its
existing feeder pig production operations by using the net proceeds from the
sale of additional shares of its Class A Common Stock, together with term debt
borrowings, to develop or acquire and thereafter operate additional 2,450-sow
feeder pig production facilities, and to develop weaned pig production
operations by using the net proceeds from the sale of shares of its Class B
Common Stock or Class C Common Stock, together with term debt borrowings, to
develop or acquire and thereafter operate 2,450-sow weaned pig production
facilities.  In this regard, the Company intends to use the net proceeds from
the sale of each block of 17 shares of Class A Common Stock, together with term
debt borrowings, to develop or acquire one such feeder pig production facility,
to use the net proceeds from the sale of each block of 18 shares of Class B
Common Stock, together with term debt borrowings, to develop or acquire one such
weaned pig production facility, and to use the net proceeds from the sale of
each block of 24 shares of Class C Common Stock, together with term debt
borrowings, to develop or acquire one such weaned pig production facility.  As
of the date of this report, however, the Company has reached an agreement with
the Company's existing lender and Farmland concerning the provision of 100% debt
financing for the development of a sixth Colorado feeder pig production
facility, until the Company's next issuance and sale of a block of 17 shares of
Class A Common Stock, at which time the up to $1,360,000 of debt financing
provided by Farmland, together with interest thereon, must be repaid.  See
"Description of Business--Financing."  No assurances can be given that the
Company will develop additional feeder pig production facilities or weaned pig
production facilities, that the Company will obtain the financing required for
any such development, whether through the sale of additional shares of capital
stock or the incurrence of additional indebtedness, or that the Company will
sell any additional shares of capital stock.

     Operation of the Company's facilities is the responsibility of the
management staff of the Company.  The Company has contracted with Farmland to
provide certain administrative services to the Company, including accounting,
production record keeping, feed and other input purchasing, employee training,
and breeding stock replacement logistics.  Farmland will be paid one dollar
($1.00) for each feeder or weaned pig sold by the Company as partial
compensation for Farmland's provision of such services.  Farmland also pays 
Alliance a $10.00 per pig royalty for any pigs raised by Alliance and sold to 
a Farmland finisher that are then selected as breeding stock for Farmland's 
contract herds pursuant to a swine production services agreement.  See 
"Description of Business -- Employees," "Directors and Executive Officers" 
under Item 9, and "Certain Relationships and Related Transactions" under 
Item 12.

     The Company has entered into contractual arrangements with certain of its
members, including Farmland and Yuma Cooperative.  Pursuant to the Swine
Production Services Agreement between the Company and Farmland, Farmland has
agreed to provide certain administrative, advisory and consulting services to
the Company.  Pursuant to the Feed Purchase Agreement between the Company and
Yuma Cooperative, Yuma Cooperative has agreed to provide Alliance with feed-
grains and feed additives for the production of feed at Yuma Cooperative's
contract rates.  Farmland and Yuma Cooperative, as members, have contracted to
purchase a share of the feeder pigs to be produced by the Company under the same
terms required of the Company's other members.  Commencing on August 11, 1995,
the date the Company first produced and shipped feeder pigs pursuant to the
Feeder Pig Purchase Agreements with the Company's existing members (other than
Farmland and Yuma Cooperative), the price paid by Farmland and Yuma Cooperative
for feeder pigs has been under terms comparable to those applicable to the
Company's members pursuant to the Feeder Pig Purchase Agreements.  Finally, the
Company has agreed to provide Farmland the first opportunity to purchase any
feeder and weaned pigs produced by the Company in excess of the Company's supply
commitments to other members or that other members have failed to purchase
during the term of the Swine Production Services Agreement (and in no event less
than the five-year period ending July 13, 1999).  The Company intends to cause
any  such excess production of weaned pigs, however, to be retained by the
Company for development into feeder pigs.  See "Certain Relationships and
Related Transactions" under Item 12 and "Description of Business -- Feeder Pig
Purchase Agreement" and "-- Weaned Pig Purchase Agreements."

     Hog production is subject to substantial risks.  Success is dependent upon
obtaining high levels of breeding stock productivity, controlling the cost and
efficiency of purchased feed and other inputs while minimizing herd exposure to
disease or other factors which can adversely impact the operation.  See "Factors
That May Affect Future Results of Operations, Financial Condition or Business"
under Item 6.

     BUSINESS ENVIRONMENT.  The pork industry has undergone substantial change
in recent years, with respect to the production and processing of hogs.  The
Company believes that current economics of the industry favor large, well-
capitalized hog producers, which use consistent, high-quality breeding stock and
employ management practices designed to maximize productivity.  As a result, hog
production has become increasingly differentiated between large-scale farrowing
operations producing feeder pigs and less capital intensive smaller-scale hog
finishing operations.

     Concentration of Production.  The last decade saw a dramatic increase in
the concentration of hog production in larger scale facilities and a
corresponding decline in the number of farms producing hogs.  Based on data
available from the U.S. Department of Agriculture, the number of farms producing
hogs in the United States has declined, while the percentage of the nation's
total hog inventory held on farms having more than a 500 head inventory, as well
as the average number of hogs per farm, has increased.

     The Company believes there are several causes for the increasing
concentration of hog production into the hands of larger producers.  Large,
specialized hog producers may be able to produce hogs for lower cost than
smaller scale independent farmers through economies of scale and the use of
improved genetics, nutrition, and management practices, many of which are more
easily implemented in modern, large-scale facilities.  Since this cost advantage
would seem to be more readily available to those making a substantial investment
in facilities, efficient hog production has become a capital-intensive industry.
The Company believes that in the wake of the "agricultural crisis" of the mid-
1980s, capital for hog production has become more difficult to obtain and has
presented an increasingly large barrier to entry.  Additionally, packers
generally pay premiums to producers both for the supply of a large volume of
hogs and for providing hogs of superior carcass merit with respect to the yield,
leanness and consistency.  Larger operations populated with genetically
consistent stock bred for high productivity and carcass quality therefore may be
able to obtain a premium on the sale of their hogs that may not be available to
smaller producers.

     Production Differentiation.  In addition to the increasing concentration of
hog production in larger scale facilities, hog production increasingly has
become differentiated between feeder pig production operations (which includes
operations relating to the production of weaned pigs) and pig finishing
operations.  The Company believes that this is partly the result of three-site
management practices which dictate the separation of production into three
stages:  breeding through farrowing; nursery; and finishing; with each phase of
production being conducted in separate locations to minimize the risk of
transmission of disease.   In producing feeder pigs, the Company engages in the
first two of these stages of production, while  the Company's production of
weaned pigs will involve only the first of these stages of production.

     Production of feeder and weaned pigs -- which is less dependent upon
variable feed cost and more dependent upon herd health, facilities and breeding
stock investment -- is increasingly being conducted in specialized facilities.
Finishing of hogs to market weight, the economics of which are principally
driven by feed cost, is increasingly handled by producers engaged exclusively in
the finishing of hogs, with many of those producers finishing hogs under
contract to the producer of the feeder pig.  The Company believes that this
increasing specialization is attributable to the capital intensive nature of
farrowing operations and the complexity of management.

     BREEDING STOCK.  Fully populated, each of the Company's feeder and weaned
pig production facilities which is either in existence, under development or
proposed is anticipated to be stocked with approximately 2,450 sows.  The
Company intends to maintain an adequate population of female-line grandparent
stock in its multiplier units to produce commercial gilts for use by the Company
in any future facilities development or to replace the commercial herd as it is
culled or lost to death.  Barrows and any excess gilts from the multiplier units
will be sold by the Company as feeder pigs.

     The Company's feeder pigs have been and will continue to be produced from
genetically consistent breeding stock.  The Company currently utilizes breeding
stock from both DeKalb Swine Breeders and Pig Improvement Company ("P.I.C."),
but is discontinuing the use of breeding stock obtained from DeKalb Swine
Breeders and is repopulating its Colorado facilities.  As further improvements
in genetics are recognized, the characteristics of the Company's breeding stock
may change.  The Company intends to continually evaluate the cost and
characteristics of breeding stock developed by other producers, and, in the
Company's discretion, to populate all or a portion of its facilities with such
breeding stock.

     The Company continually culls a portion of its breeding herd and replaces
these animals with new breeding stock in order to maintain the productivity of
its breeding herd.  The selection of animals to be culled is based on subjective
determinations as to the animal's productivity, which generally declines as the
animals mature.  The Company believes that it is positioned to generate all or
substantially all of its breeding stock replacements through its breeding stock
multiplier herd.  The Company believes that its multiplier units are and will be
able to produce virtually all of the replacement gilts and initial breeding
stock populations required by the Company for the foreseeable future. The
Company believes that its internal production of replacement gilts will result
in the cost of its breeding stock replacements being lower than could be
obtained from outside sources and will preserve the Company's control over its
entire operation.  No assurance can be given that the Company will be successful
in producing any portion of its required breeding stock replacements or that the
cost for such replacements will be lower than could be obtained from outside
sources.

     With respect to each facility under development or proposed, the Company
intends to place breeding stock in the facility over a five month period
beginning with the completion of the facility's breeding building.  It is
anticipated that approximately 800 head of breeding stock will be delivered to
the facility in the first month followed by deliveries of 400 to 450 head over
the remaining four months until the facility is fully stocked.  Following an
initial resting period of 45 to 60 days in order to acclimate and monitor each
group of breeding stock, breeding will be commenced.

     Alliance implemented an artificial insemination ("AI") program in its
Colorado operations and plans to use AI in its other facilities.  Although no
assurances can be given, Alliance believes that the use of AI will allow more
rapid improvements in carcass quality and assist in maintaining higher health
status of the herds.

     Alliance is engaged in the depopulation of its five operational feeder pig
production facilities located in Yuma County, Colorado in order to repopulate
these units with P.I.C. females.  It is anticipated that sourcing for this
repopulation will be from Alliance's Illinois facility, which is a P.I.C.
multiplier unit.  Although no assurances can be given, management believes this
change eventually will improve both productivity and health of the sow units and
may result in improved production results in both nursery and finishing pig
performance.  Repopulation began in August 1997 with P.I.C. feeder pigs first
being made available in October 1997.  Completion of the repopulation project is
anticipated to occur by June 1998.

     PURCHASE OF FEED AND OTHER INPUTS.  Farmland has agreed to assist the
Company in arranging for the provision of the Company's requirements for feed
and other inputs, including animal health products, pursuant to the Swine
Production Services Agreement between the Company and Farmland.  The Company
intends to purchase a portion of these products from Yuma Cooperative upon the
prices and terms set forth in the Feed Purchase Agreement between the Company
and Yuma Cooperative.  Farmland will establish the specifications of all
supplies purchased, as well as for the purchasing and delivery of all
requirements in coordination with the Company.  See  "Certain Relationships and
Related Transactions" under Item 12.

     The Company's Feed Purchase Agreement with Yuma Cooperative provides for
the Company's purchase of feed manufactured by Yuma Cooperative on a delivered
cost basis to be determined based upon a fixed charge for the grinding, mixing,
and delivery of feed ($14.51 per ton as of November 1, 1997), in addition to the
actual delivered cost of the feed ingredients.   Feed rations which are pelleted
are subject to a surcharge ($7.24 per ton as of November 1, 1997).  Both the
fixed charge and the surcharge are subject to annual increases in November of
each year corresponding to any increases in the Consumer Price Index -- Retail
Items.  Corn provided by Yuma Cooperative for use in feed generally is sold to
the Company at delivered cost plus, in the absence of available Company grain
storage facilities, a $.10 per bushel handling fee.  The Company has the right
under the Feed Purchase Agreement, in its sole discretion, to purchase and
provide its own corn for feed manufacturing.  Corn and soybean meal may be
substituted from time to time with other ingredients meeting equivalent
nutritional requirements based upon temporal price differentials.  See
"Description of Business -- Sale of Animals" and "Certain Relationships and
Related Transactions" under Item 12.

     The Company believes that feed costs presently account for approximately
35% to 40% of the cost of producing a feeder pig and for approximately 20% and
25% of the cost of producing a weaned pig.  The principal components of swine
feed are corn and soybean meal, which are commodities subject to substantial
fluctuations in cost due to changing market conditions, seasonality, and
regional variations.  While the Company intends to recover changes in feed costs
by making corresponding adjustments in the selling prices for its feeder and
weaned pigs, the actual changes in the sales price of feeder and weaned pigs
will lag changes in feed cost because the Company determines the cost of feeder
pigs on a twelve month historical rolling average basis and intends to determine
the cost of weaned pigs on a five month historical rolling average basis.  This
pricing method may adversely impact the Company's operations in the event of
sudden movements, or continual increases, in the cost of feed or other inputs.
See "Certain Relationships and Related Transactions" under Item 12, "Description
of Business -- Sale of Animals" and "Description of Business -- Feeder Pig
Purchase Agreement" and "-- Weaned Pig Purchase Agreements."

     SALE OF ANIMALS.  The Company intends to sell its feeder and weaned pigs to
its members.  Accordingly, the Company has contracted with its members (and
intends to contract with any new members) for the sale of the feeder and weaned
pigs produced at the Company's facilities.  Feeder Pig Purchase Agreements have
been and are to be executed by members and prospective members as a condition to
subscribing for shares of the Company's Class A Common Stock.  Weaned Pig
Purchase Agreements are to be executed by prospective members as a condition to
subscribing for shares of the Company's Class B Common Stock.  Class C Weaned
Pig Purchase Agreements are to be executed by prospective members as a condition
to subscribing for shares of the Company's Class C Common Stock.  Except as
otherwise specifically described herein, the provisions of the Weaned Pig
Purchase Agreements and the Class C Weaned Pig Purchase Agreements are
substantially identical.  Members in the Company are and will be required to
purchase, and the Company is and will be required to sell, lots of feeder pigs
produced by the Company in amounts proportionate to the respective member's pro
rata share of the Company's Class A Common Stock, but in no event greater than
two and seven-tenths (2.7) lots per share of Class A Common Stock on a
prospective rolling 12-month basis.  Presently, each share of Class A Common
Stock held in the Company will entitle the respective member to contract to
purchase one delivery allotment per 119-allotment block made available to the
members under the Feeder Pig Purchase Agreements.  Similarly, members in the
Company will be required to purchase, and the Company will be required to sell,
lots of weaned pigs produced by the Company that are to be sold to members in
amounts proportionate to the respective member's pro rata share of the Company's
Class B Common Stock or Class C Common Stock, as the case may be, but in no
event greater than two and seven-tenths (2.7) lots per share of Class B Common
Stock on a prospective rolling 12-month basis and in no event greater than two
and one-tenth (2.1) lots per share of Class C Common Stock on a prospective
rolling 12-month basis.  The Company intends to allocate its production of
weaned pigs from all facilities between those that are to be sent to nurseries
and developed by the Company into feeder pigs, on the one hand, and those that
are to be sold as weaned pigs, on the other hand, in the same proportion that
the number of the Company's operating feeder pig production facilities bears to
the number of the Company's operating weaned pig production facilities.  The
lots of feeder and weaned pigs purchased by the respective member from time to
time will not necessarily be produced from the same feeder or weaned pig
production facility.  In the event that the Company issues additional shares of
Common Stock for the construction of additional feeder or weaned pig production
facilities, the number of participants in the allotment of feeder or weaned
pigs, as the case may be, will be increased, although such increase is not
anticipated to materially change an investor's right to receive his anticipated
allotment of pigs.  Casualty to the Company's facilities, diminished breeding
stock productivity or extreme mortality or morbidity, among other adverse
circumstances, could reduce the number of feeder or weaned pigs available for
purchase by members and increase the price of pigs under the Feeder Pig Purchase
Agreements or Weaned Pig Purchase Agreements.  See "Factors That May Affect
Future Results of Operations, Financial Condition or Business" under Item 6.

     If the Company is successful in implementing its business plan and any new
feeder and weaned pig production facilities are developed on schedule, the
initial lots of feeder pigs resulting from the development and expansion of the
Company's feeder pig production operations are not expected to be available to
new investor members for up to 13 to 15 months after completion of the sale of a
minimum block of 17 shares of Class A Common Stock to such members and the
initial lots of weaned pigs resulting from the development of the Company's
weaned pig production operations are not expected to be available to new
investor members for up to 11 to 13 months after completion of the sale to such
members of a minimum block of 18 shares of Class B Common Stock or a minimum
block of 24 shares of Class C Common Stock, as the case may be.  New investor
members will not be entitled to purchase pigs from the Company until such time.
Members in the Company are required to contract for the purchase of Qualifying
Pigs (as that term is defined in the Feeder Pig Purchase Agreement or Weaned Pig
Purchase Agreements, as the case may be) from the Company's facilities.  Each
such contract, or Feeder Pig Purchase Agreement or Weaned Pig Purchase
Agreements, as the case may be, constitutes an irrevocable ten-year commitment.
Each lot of pigs purchased by a member pursuant to any such Agreement will be
priced based upon the following factors:  the financing cost per pig, the
operating cost per pig, and a production margin of  $4.50 per pig, in the case
of feeder pigs, and of $0 to $4.50 per pig (as determined by the Company in its
discretion), in the case of weaned pigs (all as defined in such Agreement).  In
the event that a member fails at least twice to perform his purchase obligation
under such Agreement, such member will be in default, which default may result
in the relinquishment of his purchase rights under such Agreement.  For each ten
shares of Common Stock owned by a member, the number of such failures that will
result in a default is increased by one.  A member's failure to perform his
purchase obligation, among other circumstances, also may result in the Company's
foreclosure on its security interest granted in the member's Common Stock.  In
addition, the member will be responsible for the damages and expenses incurred
by the Company as a result of any failure to purchase, pay for, and take
delivery of any lot of Qualifying Pigs under the Feeder Pig Purchase Agreement
or Weaned Pig Purchase Agreements, as the case may be, including (a) damages
equal to the difference between the price payable by the member for the
Qualifying Pigs that member has failed to purchase, pay for, and take delivery
under the Agreement and the then current market price for feeder or weaned pigs,
as the case may be, (b) $3,000, which amount is intended to cover the Company's
administrative and other costs and expenses associated with such failure, and
(c) all costs of collection, enforcement, and prosecution of the Company's
rights and remedies.  If the Company produces feeder pigs in excess of two and
seven-tenths (2.7) lots per share of Class A Common Stock on a prospective
rolling 12-month basis or produces weaned pigs in excess of two and seven-tenths
(2.7) lots per share of Class B Common Stock or two and one-tenth (2.1) lots per
share of Class C Common Stock on a prospective rolling 12-month basis, the
Company may sell such excess production to non-members, or retain such excess
production for the Company's own purposes, in lieu of selling such excess
production pursuant to the Feeder Pig Purchase Agreements or Weaned Pig Purchase
Agreements, as the case may be.  The Company has agreed in its Swine Production
Services Agreement with Farmland to provide Farmland the first opportunity to
purchase any such excess production and any feeder or weaned pigs that members
have failed to purchase during the term of said Agreement (and in no event less
than the five-year period ending July 13, 1999).  The Company intends to cause
any  such excess production of weaned pigs, however, to be retained by the
Company for development into feeder pigs.  See "Description of Business --
Feeder Pig Purchase Agreement" and "-- Feeder Pig Purchase Agreement," "Certain
Relationships and Related Transactions" under Item 12, and "Absence of Market"
under Item 5.

     As of the date of this report, the Company has reached an agreement with
the Company's existing lender and Farmland concerning the provision by such
lender and Farmland of 100% debt financing for the development of a sixth
Colorado feeder pig production facility.  See "Description of Business--
Financing."  In connection with obtaining this financing, Farmland has
contracted to purchase, until the first to occur of the expiration of one year
and the date on which Farmland is repaid on its loan, the marginal increase in
Alliance's production of feeder pigs (approximately 46 lots of feeder pigs on a
prospective rolling 12-month basis) resulting from the development of the
facility constructed using the proceeds of such financing.  Farmland's purchase
of such feeder pigs would be under substantially the same terms required of the
Company's members pursuant to the Feeder Pig Purchase Agreements, except that
the purchase price for pigs does not include the $4.50 per pig production
margin.  See "Description of Business--Feeder Pig Purchase Agreement."

     COMPETITION.  The feeder and weaned pig production business is competitive
and fragmented among family-owned and investor-owned farms and large-scale
agribusiness pig production operations.  Feeder and weaned pigs are available at
sale barn auction, markets such as Farmland's Pig Finder(R) electronic pig
auction market, and under contract from producers.  Competition is based upon
price, product consistency and quality, ability to deliver the required
quantities and ability to meet delivery schedules.  Although there are a great
number of operations that compete with the Company, as discussed elsewhere in
this report, the Company has contracted with its members (and intends to
contract with any new members) for the sale of feeder and weaned pigs produced
at the Company's facilities.  If the Company produces pigs in excess of its
supply commitments to members, however, the Company may sell such excess
production to non-members.  The Company believes that its most important
competitive strengths are its ability to provide competitive pricing and the
quality and consistency of the feeder pigs produced by it.  See "Description of
Business -- Business Environment" and "Description of Business -- Feeder Pig
Purchase Agreement" and "-- Weaned Pig Purchase Agreements."

     EXPANSION.  Expansion is an important element of the Company's business
plan.  The Company's present intent is to construct or acquire (a) two 2,450-sow
feeder pig production facilities (including the Company's sixth Colorado
facility currently under development) in addition to the Company's existing
facilities, following completion or acquisition of which the Company will be
operating a total of nine such facilities, and (b) six 2,450-sow weaned pig
production facilities, following completion or acquisition of which the Company
will be operating a total of six such facilities.  The ability of the Company to
construct or acquire each of such two feeder pig production facilities is
subject to it obtaining at least $3,940,000 of net financing proceeds (at least
$7,880,000 in the aggregate for two facilities), and the ability of the Company
to construct or acquire each of such six weaned pig production facilities is
subject to it obtaining at least $3,100,000 of net financing proceeds (at least
$19,160,000 in the aggregate for six facilities).  As an alternative to
developing additional 2,450-sow pig production facilities, the Company may
choose to develop a pig production facilities having twice the capacity.  In
such event, the financing required would have to be correspondingly larger.  As
of the date of this report, the Company has commenced preliminary development
activities with respect to a sixth feeder pig production facility in Yuma
County, Colorado in anticipation of obtaining such necessary financing.  In
anticipation of the Company's next issuance and sale of a block of 17 shares of
Class A Common Stock, the Company has reached an agreement with the Company's
existing lender and Farmland concerning the provision of 100% debt financing for
the development of such sixth Colorado facility.  No assurances can be given
that the Company will obtain the equity or debt financing required for the
development of additional facilities.  See "Description of Business--Financing."

     The Company believes that substantial economies of scale will be realized
in the event that the Company is able to expand beyond the two feeder pig
production facilities and six weaned pig production facilities that the Company
presently intends to construct or acquire.  These additional economies are
expected to include savings and enhancements in the production of breeding
stock, economies in the production of feed, and enhancement of management and
labor productivity.  The Company intends to pursue expansion of its operations
as financial, managerial and other resources become available.  No assurance can
be given as to when or if such resources will become available to Alliance so as
to allow it to proceed with such expansion.

     Hog production operations require the availability of ample pure water at
reasonable cost.  Although the Company has obtained access to water necessary
for it to conduct its current operations in Colorado and Illinois, the Company
has been advised that it will be unable to obtain any new commercial well
permits in Colorado.  Accordingly, the Company has found it necessary in
Colorado to obtain the water necessary for its operations through the purchase
of more expensive, irrigated land or other real property already having the
necessary commercial well permits.  No assurance can be given that the Company
will be able to obtain the water permits necessary to enable it to expand its
operations in Colorado, Illinois or other locations selected by the Company.
See "Factors that May Affect Future Results of Operations, Financial Condition
or Business -- Adequate Water Supply."

     FINANCING.  The ability of the Company to implement its business strategy
and (a) construct or acquire additional feeder pig production facilities is
subject to it obtaining at least $3,940,000 of net financing proceeds with
respect to each such facility, and (b) construct or acquire new weaned pig
production facilities is subject to it obtaining at least $3,100,000 of net
financing proceeds with respect to each such facility.  In this regard, the
Company is engaged in a public offering of shares of its Common Stock.  In
addition to the proceeds to be received from the possible issuance of additional
shares of Common Stock, the Company would be required to obtain additional funds
through secured term debt borrowings.  The Company anticipates that (a) with
respect to each minimum block of 17 shares of Class A Common Stock issued by the
Company at an aggregate price of $1,360,000, the Company would be required to
borrow approximately $2,720,000 of term debt borrowings in order to construct
one new feeder pig production facility and related support facilities, to
purchase breeding stock, and to provide working capital for operations, (b) with
respect to each minimum block of 18 shares of Class B Common Stock issued by the
Company at an aggregate price of $1,080,000, the Company would be required to
borrow approximately $2,160,000 of term debt borrowings in order to construct
one new weaned pig production facility and related support facilities, to
purchase breeding stock, and to provide working capital for operations, and (c)
with respect to each minimum block of 24 shares of Class C Common Stock issued
by the Company at an aggregate price of $1,080,000, the Company would be
required to borrow approximately $2,160,000 of term debt borrowings in order to
construct one new weaned pig production facility and related support facilities,
to purchase breeding stock, and to provide working capital for operations.  The
amount of this proposed financing has been determined based upon the anticipated
capital expansion and business operations needs of the Company and the
anticipated net proceeds from the issuance of shares of Common Stock.

     On May 19, 1995, the Company entered into various loan documents with
CoBank, ACB ("CoBank") related to a $23,600,000 secured credit facility.  This
credit facility provides for up to $18,850,000 of  non-revolving term debt and
$4,750,000 of revolving term credit.  Proceeds from the term debt may be used
for construction of feeder pig production facilities and are advanced by CoBank
as construction costs are incurred by Alliance.  Proceeds from revolving term
credit may be used for working capital and other purposes.  The actual advance
of funds under this credit facility is subject to the satisfaction of certain
conditions precedent and may be withdrawn or terminated by CoBank under certain
circumstances.  No assurances can be given that the funding conditions precedent
will be satisfied and that the Company will be able to obtain sufficient
financing when needed, or that alternative sources of financing will be
available on acceptable terms.  In addition, the unused portion of the credit
facility expires December 31, 1997 (extended from the original February 28, 1997
expiration date) with respect to the non-revolving term debt and June 20, 2006
with respect to the revolving term credit.  The Company has obtained a
commitment from CoBank for an approximately $35,255,000 credit facility to
replace the existing credit facility and to provide debt financing for use in
the development of feeder and weaned pig production facilities.  As of the date
of this report, Alliance was engaged in negotiations with CoBank concerning the
preparation of definitive loan documentation with respect to such commitment.
No assurances can be given that such negotiations will be successful and that
definitive loan documentation will be entered into on favorable terms, if at
all.  As of the date of this report, the Company has not obtained a credit
facility for construction of weaned pig production facilities but, as mentioned
above, has obtained a commitment for such a credit facility from CoBank.

     The availability of non-revolving term debt and revolving term credit under
the existing CoBank credit facility is subject to specified equity investment
levels in the Company being satisfied.  As of August 31, 1997, $223,869 of term
loans were immediately available to the Company, $211,000 of terms loans were
available upon CoBank's final acceptance and approval of the feeder pig
production facilities then under development, and $938,131 of revolving term
credit was immediately available.  The availability of the unused $4,220,000
term loan and $1,220,000 revolving term credit under the CoBank credit facility
is restricted and may be made available to the Company only to the extent that
additional equity investment is made in the Company.  With respect to each
additional equity investment of $1,360,000 obtained by the Company (e.g., 17
shares of Class A Common Stock sold for at least $80,000 each), the Company is
entitled to obtain advances under the credit facility of $2,720,000 ($2,110,000
of term loans and $610,000 of revolving term credit), up to an aggregate of
$8,160,000.  As more fully described below, as of the date of this report, the
Company has agreed with CoBank and Farmland that it may obtain an advance under
the CoBank credit facility of $2,720,000 and a loan from Farmland of $1,360,000,
without the necessity of satisfying the additional equity investment
requirement.

     Prior to any advance being made by CoBank under the existing credit
facility, certain conditions precedent must be addressed to CoBank's
satisfaction, including but not limited to (i) provision of environmental audits
respecting the Company's realty, (ii) obtaining performance bonds and lien
payment bonds and builder's risk casualty insurance respecting such
construction, (iii) obtaining a chain of title and title insurance respecting
the Company's realty, and (iv) provision of evidence that CoBank has a perfected
first priority lien on all security for the Company's obligations.  It is
anticipated that the actual advance of funds under the replacement credit
facility being negotiated would subject to the satisfaction of similar
conditions precedent.  No assurances can be given that any funding conditions
precedent will be satisfied and that the Company will be able to obtain
sufficient financing when needed, or that alternative sources of financing will
be available on acceptable terms. As of August 31, 1997, the outstanding balance
of loans made by CoBank under the existing credit facility was $14,967,000.

     As a temporary alternative to funding an expansion of the Company's
operations with a combination of debt and equity financing, as of the date of
this report CoBank and Farmland have agreed to the provision of 100% debt
financing.  This financing alternative was obtained in connection with the
commencement of preliminary development activities on a sixth feeder pig
production facility in Yuma County, Colorado (and previously was used in the
development of the Company's second Illinois feeder pig facility).  See
"Description of Business--Expansion."  Such financing consists of $2,110,000 of
non-revolving term debt and $610,000 of revolving term debt obtained from CoBank
and $1,360,000 of subordinated non-revolving term debt from Farmland.    See
"Description of Property" under Item 2 and "Certain Relationships and Related
Transactions--Farmland--Real Estate Loans" under Item 12.

     The CoBank portion of this financing is being provided under the Company's
existing credit facility.  The Farmland portion of this financing is being
provided on terms substantially identical to those applicable to the $1,360,000
loan previously made by Farmland to Alliance for the development of a second
feeder pig production facility in Wayne County, Illinois.  See "Certain
Relationships and Related Transactions--Farmland--Real Estate Loans."  In this
regard, the Farmland portion of this financing provides for amortization over a
ten-year period, at a variable rate equal to CoBank's then national variable
rate plus 1.25%.  The payment schedule for the Farmland loan requires the
Company to make interest-only payments for the life of the loan, with a final
balloon payment of the outstanding loan balance to be made upon the earlier of
(i) the Company's next issuance and sale of a minimum block of 17 shares of
Common Stock, and (ii) the expiration of ten years.  Alliance's obligation to
Farmland is secured by a mortgage/deed of trust on the facilities constructed
with the proceeds of the loan, which mortgage/deed of trust is second in
priority to that of CoBank.  In addition, Farmland has agreed to purchase all
feeder pigs produced at the facility that is constructed using the proceeds of
the Farmland loan until the first to occur of the expiration of one year and the
date on which Farmland is repaid on its loan.  See "Description of Business--
Sale of Animals."  As a result of the larger portion of indebtedness associated
with this financing alternative (and the higher debt service related thereto) as
compared with the debt and equity alternative discussed above, the net proceeds
from the issuance of shares of Common Stock that would be required must be
correspondingly greater in order to provide for the balloon payment of principal
and required installments of interest under the Farmland loan.  There can be no
assurance that the Company would be successful in selling shares of Common Stock
at prices that are sufficient to provide the net proceeds required, or that the
Company will sell any shares of Common Stock.

     In connection with the Company's acquisition of certain real property in
Yuma County, Colorado, the Company borrowed $760,000 from Farmland.  This loan
is evidenced by a promissory note providing for amortization over a ten-year
period, at a variable rate of interest equal to CoBank's prime rate.  The
payment schedule for this loan requires the Company to make interest-only
payments for the life of the loan, with a final balloon payment of all principal
to be made upon the expiration of the ten-year term. See "Description of
Property" under Item 2 and "Certain Relationships and Related Transactions--
Farmland--Real Estate Loans" under Item 12.

     The existing  CoBank credit facility provides for the monthly payment of
principal and interest.  Principal payments pursuant to the loan terms with
respect to the initial $8.3 million of non-revolving term loans are to be made
in 114 monthly installments of $72,500 each, beginning January 20, 1996, with
the remaining unpaid balance being due and payable on July 20, 2005.  Principal
payments pursuant to the loan terms with respect to each $2,110,000 of new non-
revolving term loans are to be made in monthly installments of $18,700 each,
beginning on the 20th day of the eighteenth month following the date of the
initial advance of such $2,110,000 loan.  Principal payments pursuant to the
loan terms with respect to the revolving term loan are to be made in 24 equal
monthly installments of the principal that is outstanding as of the June 20,
2006 expiration of the revolving loan commitment, beginning on the 20th day of
the month following the payment in full of the new non-revolving term loan (but
in no event later than March 20, 2008).  Interest accrues on the outstanding
principal balance of the loan at a rate equal to either (i) a variable rate
equal to CoBank's then national variable rate plus 1.25%, or (ii) CoBank's then
quoted rates for fixed rate loans, as may be elected from time to time by the
Company, and is payable monthly in arrears by the 20th day of the following
month.  During the period in which principal under the loan is outstanding,
portions of such principal may bear interest at such variable rate while other
portions may bear interest at such fixed rate.  As of August 31, 1997, interest
accrued on the outstanding principal balance of the loan at a rate of 9.75% per
annum (calculated by adding 125 basis points to CoBank's national variable rate
of 8.50% in effect as of such date).  The interest rate(s) applicable to the
loan are subject to reduction at specified times upon the Company's satisfaction
of certain conditions relating to the Company's equity level and debt service
coverage ratio.  As of August 31, 1997, no reductions in the Company's interest
rate had been made.  The Company is permitted to prepay the loan at any time
without penalty, except that in the event that fixed rate balances are prepaid,
the Company is required to pay CoBank a surcharge in an amount equal to CoBank's
funding losses with respect thereto or, if the CoBank loan is refinanced by
another lender, a surcharge in an amount sufficient (on a present value basis)
to enable CoBank to maintain the yield it would have earned on the amount repaid
for the period such amount was scheduled to be outstanding at a fixed rate.

     In obtaining the initial non-revolving CoBank loan, the Company was
required to pay a $50,000 origination fee as well as make an equity investment
in CoBank of $1,000.  In addition, the Company paid a $36,000 origination fee in
connection with the refinancing of its existing CoBank loan, and will be
required to pay a $6,000 fee with respect to the origination of each $2,110,000
of new non-revolving term loans.  During the course of the loan, the Company may
be required to make additional equity investments at a rate not to exceed 1% of
the average five-year principal loan balance (which additional equity
investments may be satisfied out of CoBank's non-cash patronage distributions)
until the Company meets CoBank's target level of equity investment, which
currently is 11.5% of the Company's average five-year principal loan balance.
In addition, the Company was required to grant a first perfected lien and
security interest on substantially all of its properties and assets to CoBank
and to assign to CoBank all of the Company's rights in and to the existing
Feeder Pig Purchase Agreements.  The Company is required to comply with various
affirmative and negative covenants, including but not limited to (i) maintenance
of at least $2,250,000 of equity, plus $550,000 of equity for each facility
developed by the Company after its initial four facilities ($3,900,000 of equity
was required at August 31, 1997 and the Company had $6,496,168 of equity at such
date), (ii) maintenance of modified working capital (calculated as current
assets, plus available revolving term credit, minus current liabilities
(excluding the current portion of term debt payments)) of at least $210,000,
plus $98,000 of modified working capital for each facility developed by the
Company after its initial four facilities  ($504,000 of modified working capital
was required at August 31, 1997 and the Company had $2,086,406 of modified
working capital at such date), (iii) provision of monthly financial statements
and audited annual financial statements to CoBank, (iv) restrictions on the
incurrence of additional indebtedness, (v) restrictions on certain liens,
mergers, sales of assets, investments, guaranties, loans, advances and business
activities unrelated to existing operations, and (vi) restrictions on the
declaration and payment of the cash portion of patronage distributions and other
distributions or allocations of the Company's earnings, surplus or assets.  The
Company was in compliance with each of these covenants as of August 31, 1997.

     On October 21, 1997, Alliance and CoBank entered into a commitment letter
for the provision by CoBank of financing for the debt portion of the
construction of six 2,450-sow weaned pig production facilities, related support
facilities and initial breeding stock associated with each unit and to restate
and modify the terms and conditions of the existing loan agreements, including
commitments for financing the debt portion of up to three 2,450-sow feeder pig
facilities, related support facilities, initial breeding stock and capitalized
start up costs associated with each unit.  This credit facility would provide
for up to $21,120,000 of construction loan commitments, $27,595,000 of non-
revolving term debt and $7,660,000 of revolving term credit.  Under this
proposed new credit facility, proceeds from the construction loan debt are used
for construction of facilities and are advanced by CoBank as construction costs
are incurred by Alliance.  Proceeds from the non-revolving and revolving term
credit are used to repay the construction debt upon completion of a facility,
and for working capital and other purposes.

     The proposed new credit facility provides for the monthly payment of
principal and interest.  The existing non-revolving term loans are to be re-
amortized effective August 31, 1998.  Each new tranche of non-revolving term
credit will be repaid with monthly interest payments and with 97 monthly
principal payments of $21,800 for feeder pig facilities and $17,300 for weaned
pig facilities to begin 18 months after the initial advance on each new
construction loan commitment.  The revolving credit will be repaid on August 30,
2010 and will decrease in 40 equal amounts at the end of each of the Company's
fiscal quarters based on the amount of available commitment at August 30, 2000.
Alliance will also be subject to maintaining compliance with various financial
and other covenants to be specified in a new loan agreement.  Alliance presently
is engaged in negotiations with CoBank concerning the execution and delivery of
a new loan agreement.  No assurances can be given that such negotiations will be
successful and that Alliance will enter into an agreement having provisions
satisfactory to it.

     WASTE DISPOSAL AND ENVIRONMENTAL MATTERS.  Several environmental
requirements potentially are applicable to feeder and weaned pig production
operations such as those conducted or proposed to be conducted by the Company.
Generally, these requirements take the form of federal statutory and regulatory
requirements that are, in some cases, reflected in similar state requirements.
In other instances, state or local requirements may exist separately and without
federal precedent.

     The principal environmental regulations with which the Company must comply
are related to the handling and disposal of waste water generated at the
Company's facilities.  The federal Clean Water Act generally prohibits the
discharge of pollutants into the waters of the United States.  The Environmental
Protection Agency ("EPA") has further issued regulations that prohibit the
discharge of waste water from animal feedlot operations into the waters of the
United States, except under certain circumstances when excessive rainfall runoff
added to existing process waste water exceeds the design capacity of the waste
water handling and treatment facilities.  These regulations therefore generally
require that waste water handling and treatment facilities for "animal feedlots"
(which term is defined broadly enough to cover the Company's operations) be of a
non-discharge nature.

     To comply with these federal requirements, animal feedlot operators, such
as the Company, must either obtain a permit from the EPA for its operations, or,
in the case of a state which has been granted authority by EPA to carry out a
Clean Water Act program, application must be made to the state.  The State of
Colorado and the State of Illinois each has been granted such authority by the
EPA.  The Colorado and Illinois regulations generally adopt the format of the
EPA provisions for animal feedlots, and generally require concentrated animal
feeding operations to be operated as non-discharge facilities.  These
regulations require that the Company design, construct, and operate waste water
control structures capable of retaining and processing all waste water and storm
runoff which enter the facility, with the exception of water generated from
rainfall in excess of certain prescribed parameters.  Moreover, these
regulations authorize the state agency to require the removal of accumulated
manure and process waste water as necessary to prevent the overflow of the
containment and processing structure.  The Company uses lagoon containment and
processing systems at its production facilities to comply with these
regulations.

     Land application of manure and process waste water also is regulated by
Colorado and Illinois regulations.  Generally, these regulations authorize the
state agency to require that manure and process waste water not be distributed
on lands in a manner that affects the quality of waters, impairs existing
beneficial uses, or exceeds estimated soil infiltration rates, and shall not be
applied when the land is frozen, saturated or during rainfall.  Sprinkler
irrigation equipment must include a back flow prevention device.  Land
application rates are established on a case-by-case basis after taking into
account the nature and type of manure or process waste water and the
characteristics of the area to which it is to be applied.

     Each feeder or weaned pig production facility is or will be designed to
enable the removal of animal waste by means of emptying shallow pits located
under the slatted floors of each facility.  Animal waste falls through the
slatted floor into the pit which is filled with water.  Periodically, each pit
is drained and refilled.  Waste water drained from a pit is moved into a lagoon
system for treatment.  All lagoons must be of a size adequate to accommodate the
anticipated volume of waste water to be generated together with storm water
runoff.  Further, each lagoon must be lined with a material that prevents or
inhibits the seepage of waste water into the ground water below.

     Cost of design and construction of waste water treatment systems vary by
facility based upon the characteristics of each individual site.  The Company
has estimated that the cost of construction of lagoons and the attendant pumps
and piping required to handle the waste water generated at each feeder or weaned
pig production facility will range from approximately $100,000 to $135,000.
Ongoing expenditures to handle waste water consist principally of expenditures
for utilities and maintenance.  Such ongoing expenditures do not constitute a
significant operating cost to the Company.

     EMPLOYEES.  Operating management of each of the Company's existing and
future facilities will be the responsibility of each respective production
facility's General Manager. The General Manager will have overall responsibility
for the operation of the facility.  Additional department managers likely will
oversee the breeding/gestation, farrowing, and nursery departments.  It is
anticipated that each facility under development or proposed will employ eleven
persons in breeding through farrowing operations, including management and
laborers.

     Pursuant to the Swine Production Services Agreement between the Company and
Farmland, Farmland has agreed to assist in providing certain administrative
services to the Company, including the coordination of the Company's training of
personnel to be employed by the Company and the selection of employees.

     As of August 31, 1997, the Company employed 123 persons, of whom 122 were
full-time employees and one was a part-time employee.  Of the Company's 122
full-time employees, 13 employees are assigned to perform various facilities
operation services for Pig Producers I, L.P. ("Pig Producers"), a limited
partnership in which Farmland holds a 12.5% interest.  Pig Producers is engaged
in the production of feeder pigs from a 2,450-sow feeder pig production facility
located in Yuma County, Colorado.  The Company is reimbursed by Pig Producers
for all wages, benefits and other costs attributable to the Alliance employees
performing services for Pig Producers.  See "Certain Relationships and Related
Transactions--Farmland" under Item 12.  The Company is not a party to any
collective bargaining agreement and considers its relationship with employees to
be satisfactory.

     GOVERNMENT REGULATION.  The Company is subject to various federal, state
and local government regulations, including those restricting certain types of
investor-owned livestock production and those concerning the environment,
occupational safety and health and zoning.  In addition, its employment
practices are governed by minimum wage, overtime and other working condition
regulations.  The Company has not experienced significant difficulty in
complying with applicable regulations and compliance generally has not had an
adverse effect on the Company's business.  See "Description of Business -- Waste
Disposal and Environmental Matters."

     FEEDER PIG PURCHASE AGREEMENT.

     General.  The rights and obligations of the parties with respect to the
sale of feeder pigs by the Company to its members will be governed by the Feeder
Pig Purchase Agreements.  Although the following summary describes the material
provisions of the Feeder Pig Purchase Agreement, it does not purport to be a
complete statement of all provisions of the Feeder Pig Purchase Agreement and in
no way modifies or amends the Feeder Pig Purchase Agreement.

     Purchase.  The Company intends to sell feeder pigs that meet particular
minimum weight, health, nutrition and genetic quality standards to members of
the Company who have entered into a Feeder Pig Purchase Agreement with the
Company.  Feeder pigs that meet such standards, as set forth in the Feeder Pig
Purchase Agreement, are referred to as "Qualifying Pigs."  Pursuant to the terms
of the Feeder Pig Purchase Agreement, the member of the Company is required to
purchase, and the Company is required to sell, Qualifying Pigs in lots of no
less than 900, and no more than 1,000, Qualifying Pigs per lot, as determined by
the Company.  Such lots of feeder pigs are to be made available to members of
the Company on a rotating schedule determined and implemented by the Company,
with the number of lots made available to a member and the frequency of
availability being based upon the member's proportionate ownership interest in
the Company's outstanding Class A Common Stock and the actual production of
Qualifying Pigs from the Company's facilities.  If the Company is successful in
implementing its business plan and the proposed new feeder pig production
facilities are developed on schedule, the initial lots of feeder pigs resulting
from the development and expansion of the Company's feeder pig production
operations are not expected to be available to new investor members for up to 13
to 15 months after completion of the sale of a minimum block of 17 shares of
Class A Common Stock to such members.  New investor members will not be entitled
to purchase feeder pigs from the Company until such time.  In the event that the
production of feeder pigs exceeds two and seven-tenths (2.7) lots per share of
Class A Common Stock on a prospective rolling 12-month basis, the Company may
sell such excess production to non-members, or retain such excess production for
the Company's own purposes, in lieu of selling such excess production pursuant
to the Feeder Pig Purchase Agreements.  Members will not be entitled to purchase
any excess production of feeder pigs.  The Company has agreed in its Swine
Production Services Agreement with Farmland to provide Farmland the first
opportunity to purchase excess feeder pigs produced by the Company during the
term of said Agreement (and in no event less than the five-year period ending
July 13, 1999).  See "Certain Relationships and Related Transactions --
Farmland" under Item 12.

     Price.  The Company intends to sell Qualifying Pigs, subject to adjustment
for weight as described below, pursuant to a pricing formula consisting of the
sum of the following factors:  the financing cost per pig, the operating cost
per pig, and a $4.50 per pig production margin. The financing cost per pig
applicable to a member is to be determined on a rolling 12-month prospective
basis and will be equal to the quotient obtained by dividing (i) the sum of the
anticipated required payments of principal and interest (including any scheduled
sinking fund payments) for the ensuing 12-month period with respect to the term
debt borrowings incurred by the Company in connection with the consummation of
the sale of Class A Common Stock to such member, by (ii) the total number of
Qualifying Pigs anticipated to be produced and shipped by the Company during
such 12-month period from the one or more feeder pig production facilities
developed through the use of such term debt borrowings and the net proceeds from
the sale of Class A Common Stock to such member (such estimate being based on
the total estimated number of Qualifying Pigs to be produced and shipped by the
Company during such 12-month period from all feeder pig production facilities of
the Company).  The operating cost per pig is to be determined on a rolling 12-
month historical basis and will be equal to the quotient obtained by dividing
(i) the sum of (A) all expenses (excluding interest expense, depreciation and
amortization) of the Company, plus (B) the net cash flow cost of all capital
expenditures of the Company (including any capital sinking fund payments) for
production facility and breeding stock improvements and replacements, in each
case, for the 12 months preceding the then present month of shipment, by (ii)
the number of Qualifying Pigs produced and shipped by the Company during such
12-month period.  At the time the Company notifies a member that a lot is
available for purchase by the member pursuant to the member's Feeder Pig
Purchase Agreement, the Company will furnish to the member an estimate of the
total purchase price of all Qualifying Pigs included in the lot, and the member
is required to pay such estimated total purchase price to the Company not less
than one day prior to the scheduled shipment date.  The actual total purchase
price of all Qualifying Pigs included in a lot sold to a member will be based
upon weight at the time of loading and settlement of any adjustments shall be
made within five days following delivery.

     Weight Adjustment.  The purchase price for Qualifying Pigs is subject to
adjustment based upon the extent of any variation in the average weight of
Qualifying Pigs from 45 pounds.  To the extent that the average weight of a
shipment of Qualifying Pigs exceeds 45 pounds per pig, the purchaser will pay an
additional $.25 per pound per pig on the first five pounds by which the average
weight exceeds 45 pounds per pig and an additional $.15 (or $.20 under some
Agreements) per pound per pig for the average weight between 50 pounds and 60
pounds.  To the extent that the average weight of a shipment of Qualifying Pigs
is less than 45 pounds per pig, the purchase price will be decreased by $.25 per
pound per pig.

     Delivery of Pigs.  The Company will be responsible for obtaining, at the
Company's expense, all health permits necessary to qualify the pigs for
interstate shipment.  It is anticipated that all lots of Qualifying Pigs will be
weighed at the Company's expense at a state-inspected scale near the Company's
production facility.  Delivery is to be FOB shipping point, with the members
bearing the risk of loss during transit, and the trucks used to haul Qualifying
Pigs from the Company's production facility must be thoroughly cleaned and
disinfected prior to loading.  A member may inspect the lot of Qualifying Pigs
to be purchased by such member prior to loading.  After the delivery of pigs at
their destination, a member will have the right to seek an appropriate price
adjustment for any pig which is found not to be a Qualifying Pig.  Such
adjustment will be made following the Company's inspection of the subject pigs,
and will be determined through mutual agreement of the Company and the member.

     Term and Termination.  A member's Feeder Pig Purchase Agreement will be for
an initial term commencing on the date entered into and continuing for a period
of 120 months after the date the first delivery of Qualifying Pigs is made to
the member thereunder, subject to earlier termination upon the occurrence of
certain events.  Feeder Pig Purchase Agreements will be extended automatically
for succeeding one year terms unless the member gives to the Company, not less
than one year prior to the expiration of the initial or any extended term,
notice that the member desires to terminate the Feeder Pig Purchase Agreement as
of the expiration of such initial or extended term.  The Company may terminate a
member's Feeder Pig Purchase Agreement if the member fails to purchase, pay for,
and take delivery of any two lots of Qualifying Pigs when and as made available
to the member; provided, however, that for each ten shares of Common Stock owned
by a member, the number of such failures necessary before the Company may
terminate such member's Agreement is increased by one.  The member may terminate
the Feeder Pig Purchase Agreement if the Company materially breaches any
obligation or covenant in the Agreement and such breach is not cured within 30
days following notice of such breach given by the member to the Company.
Furthermore, if the first delivery of Qualifying Pigs thereunder is not made
within 24 months of the date of the Feeder Pig Purchase Agreement, the member
may terminate the Agreement within three months after the expiration of such 24-
month period.  If either party is prevented from performing under the Feeder Pig
Purchase Agreement because of reasons beyond its control which make it
commercially impossible to perform, however, then that party is relieved from
such performance so long as it remains commercially impossible to perform.  A
member's Feeder Pig Purchase Agreement automatically terminates if the member
assigns or transfers all shares of Class A Common Stock from which the member's
right to purchase lots of Qualifying Pigs under the Agreement derives.  Except
as described above, a member does not have the right to terminate the Feeder Pig
Purchase Agreement prior to the expiration of the initial or any extended term
thereof.  As noted above, the member's right to terminate the Feeder Pig
Purchase Agreement at the expiration of the initial or any extended term thereof
may be exercised only if the member gives notice to the Company at least one
year prior to the expiration of such initial or extended term that the member
desires to exercise such termination right.  The foregoing termination rights
constitute the member's exclusive rights of termination under the Feeder Pig
Purchase Agreement.  No member has the right to demand the return of or to
receive any of the member's capital from the Company as a result of the
termination of the Feeder Pig Purchase Agreement or otherwise and regardless of
whether demanded prior to the expiration of the initial or any extended term of
the Feeder Pig Purchase Agreement or at any time after the expiration of any
such term.  The Company is under no obligation to redeem or repurchase its Class
A Common Stock prior to the expiration of the initial or any extended term of
the Feeder Pig Purchase Agreement or at any time after the expiration of any
such term.  See "Absence of Market" under Item 5.

     Effect of Purchaser Default.  If a member fails to purchase, pay for, and
take delivery of any lot of Qualifying Pigs when and as made available to the
member pursuant to the Feeder Pig Purchase Agreement, the member is responsible
for the damages and expenses incurred by the Company as a result of such
failure.  In particular, the member is liable for (a) the difference between the
price payable by the member for the Qualifying Pigs that member has failed to
purchase, pay for, and take delivery under the Agreement and the then current
market price for feeder pigs, (b) $3,000, which amount is intended to cover the
Company's administrative and other costs and expenses associated with such
failure to purchase, pay for, and take delivery of the Qualifying Pigs, and (c)
all costs of collection, enforcement, and prosecution of the Company's rights
and remedies under the Agreement or otherwise arising.  If a member fails to pay
promptly the damages and expenses incurred by the Company as a result of the
member's failure to purchase, pay for and take delivery of a lot of Qualifying
Pigs, such member will not be permitted to purchase any other lots unless and
until such damages and expenses are paid, and such member also will be
responsible for all damages and expenses accruing to the Company with respect to
lots that such member is not permitted to purchase as a result thereof.  In
addition to the member's responsibility for such damages and expenses, the
Company may pursue other remedies, including the termination of the member's
Feeder Pig Purchase Agreement.  If the member is prevented from performing under
the Feeder Pig Purchase Agreement because of reasons beyond the member's control
which make it commercially impossible to perform, however, then the member is
relieved from such performance so long as it remains commercially impossible to
perform.  See "Description of Business -- Feeder Pig Purchase Agreement -- Term
and Termination" and "-- Grant of Security Interest."

     Grant of Security Interest.  Pursuant to the Feeder Pig Purchase Agreement,
a member grants to the Company, as security for the performance of all of the
member's obligations under the Feeder Pig Purchase Agreement, a security
interest in all of the member's equity interest in the Company.  In this regard,
the certificates representing shares of Class A Common Stock will be retained by
Alliance and members will be required to endorse appropriate stock powers with
respect to such certificates.  The Company's security interest in the member's
shares of Class A Common Stock is to be senior to all others, except for any
permissible pledge or other security interest granted in such shares by the
member to any financial institution for purposes of securing a loan used in
financing the member's acquisition of such shares and as otherwise agreed by the
Company in its discretion.  A member's failure to perform his purchase
obligation under the Feeder Pig Purchase Agreement, among other occurrences, may
result in the Company's foreclosure on the security interest in the member's
Class A Common Stock.  See "Absence of Market" under Item 5.

     Warranties.  The Company makes no warranties, express or implied, with
respect to feeder pigs produced by it, except as expressly provided in the
Feeder Pig Purchase Agreement.  The Company specifically disclaims any
warranties of merchantability or fitness for a particular purpose and makes no
warranty as to any specific level of performance with respect to any pigs sold
thereunder.

     Arbitration.  Any controversy arising out or relating to a Feeder Pig
Purchase Agreement or any breach thereof (other than certain controversies that
include, but are not limited to, controversies arising out of a member's failure
to purchase, pay for, and take delivery of any lot of Qualifying Pigs and the
Company's exercise of any rights or remedies related thereto) is required to be
submitted to binding arbitration under the Feeder Pig Purchase Agreement.
Arbitration hearings are to take place in Denver, Colorado, or at such other
location as the Company and such member may agree, with judgment upon the award
rendered by the arbitrator being entered in any court having jurisdiction.

     WEANED PIG PURCHASE AGREEMENTS.

     General.  The rights and obligations of the parties with respect to the
sale of weaned pigs by the Company to its members will be governed by (i) the
Weaned Pig Purchase Agreements, in the case of members owning Class B Common
Stock ("Weaned Pig Purchase Agreements"), and (ii) the Class C Weaned Pig
Purchase Agreements, in the case of members owning Class C Common Stock ("Class
C Weaned Pig Purchase Agreements" and together with the Weaned Pig Purchase
Agreements, the "Weaned Pig Agreements").  Except as otherwise specifically
described under this "Weaned Pig Purchase Agreements" caption, the provisions of
the Weaned Pig Purchase Agreements and the Class C Weaned Pig Purchase
Agreements are substantially identical. Although the following summary describes
the material provisions of each of the Weaned Pig Agreements, it does not
purport to be a complete statement of all provisions of the Weaned Pig Purchase
Agreement or the Class C Weaned Pig Purchase Agreement and in no way modifies or
amends either of the Weaned Pig Agreements.

     Purchase.  The Company intends to sell weaned pigs that meet particular
minimum weight, health, nutrition and genetic quality standards to members of
the Company who have entered into a Weaned Pig Agreement with the Company.
Weaned pigs that meet such standards, as set forth in the Weaned Pig Agreements,
are referred to as "Qualifying Pigs."  Pursuant to the terms of the Weaned Pig
Agreements, the member of the Company is required to purchase, and the Company
is required to sell, Qualifying Pigs in lots of no less than 925, and no more
than 1,025, Qualifying Pigs per lot, as determined by the Company.  Such lots of
weaned pigs are to be made available to members of the Company on a rotating
schedule determined and implemented by the Company, with the number of lots made
available to a member and the frequency of availability being based upon the
member's proportionate ownership interest in the Company's outstanding Class B
Common Stock or Class C Common Stock, as the case may be, and the actual
production of Qualifying Pigs from the Company's facilities.  The Company
intends to allocate its production of weaned pigs from all facilities between
those that are to be sent to nurseries and developed by the Company into feeder
pigs, on the one hand, and those that are to be sold as weaned pigs, on the
other hand, in the same proportion that the number of the Company's operating
feeder pig production facilities bears to the number of the Company's operating
weaned pig production facilities.  If the Company is successful in implementing
its business plan and the proposed new weaned pig production facilities are
developed on schedule, the initial lots of weaned pigs resulting from the
development and expansion of the Company's weaned pig production operations are
not expected to be available to new investor members for up to 11 to 13 months
after completion of the sale of a minimum block of 18 shares of Class B Common
Stock or minimum block of 24 shares of Class C Common Stock, as the case may be,
to such members.  New investor members will not be entitled to purchase weaned
pigs from the Company until such time. In the event that (i) the production of
weaned pigs that are to be sold to members under the Weaned Pig Purchase
Agreements exceeds two and seven-tenths (2.7) lots per share of Class B Common
Stock on a prospective rolling 12-month basis, or (ii) the production of weaned
pigs that are to be sold to members under the Class C Weaned Pig Purchase
Agreements exceeds two and one-tenth (2.1) lots per share of Class C Common
Stock on a prospective rolling 12-month basis, the Company may sell such excess
production to non-members, or retain such excess production for the Company's
own purposes, in lieu of selling such excess production pursuant to the Weaned
Pig Agreements.  Investor members will not be entitled to purchase any excess
production of weaned pigs.  The Company intends to cause any such excess
production of weaned pigs to be retained by the Company for development into
feeder pigs.  The Company has agreed in its Swine Production Services Agreement
with Farmland to provide Farmland the first opportunity to purchase any excess
weaned pigs that are to be sold by the Company during the term of said Agreement
(and in no event less than the five year period ending July 13, 1999).  See
"Certain Relationships and Related Transactions -- Farmland" under Item 12.

     Price.  The Company intends to sell Qualifying Pigs, subject to adjustment
for weight as described below, pursuant to a pricing formula consisting of the
sum of the following factors:  the financing cost per pig, the operating cost
per pig, and a production margin of  $0 to $4.50 per pig (as determined by the
Company in its discretion). The financing cost per pig applicable to a member is
to be determined on a rolling five-month prospective basis and will be equal to
the quotient obtained by dividing (i) the sum of the anticipated required
payments of principal and interest (including any scheduled sinking fund
payments) for the ensuing 12-month period with respect to the term debt
borrowings incurred by the Company in connection with the consummation of the
sale of Class B Common Stock or Class C Common Stock, as the case may be, to
such member, by (ii) the total number of Qualifying Pigs anticipated to be
produced and shipped by the Company during such 12-month period from the one or
more weaned pig production facilities developed through the use of such term
debt borrowings and the net proceeds from the sale of Class B Common Stock or
Class C Common Stock, as the case may be, to such member (such estimate being
based on the total estimated number of Qualifying Pigs to be produced and
shipped by the Company during such 12-month period from all weaned pig
production facilities of the Company).  The operating cost per pig is to be
determined on a rolling five-month historical basis and will be equal to the
quotient obtained by dividing (i) the sum of (A) all expenses (excluding
interest expense, depreciation and amortization) of the Company, plus (B) the
net cash flow cost of all capital expenditures of the Company (including any
capital sinking fund payments) for production facility and breeding stock
improvements and replacements, in each case, for the five months preceding the
then present month of shipment, by (ii) the number of Qualifying Pigs produced
and shipped by the Company during such five-month period.  The production margin
per pig is to be determined by the Company in its discretion, subject to the
satisfaction of any applicable covenants imposed by the Company's lender.  To
the extent that the Company reduces the production margin to an amount less than
$4.50 per pig, the Company's operating results may be materially and adversely
affected.  At the time the Company notifies a member that a lot is available for
purchase by the member pursuant to the member's Weaned Pig Agreement, the
Company will furnish to the member an estimate of the total purchase price of
all Qualifying Pigs included in the lot, and the member is required to pay such
estimated total purchase price to the Company not less than one day prior to the
scheduled shipment date.  The actual total purchase price of all Qualifying Pigs
included in a lot sold to a member will be based upon weight at the time of
loading and settlement of any adjustments shall be made within five days
following delivery.

     Weight Adjustment.  The purchase price for Qualifying Pigs is subject to
adjustment based upon the extent of any variation in the average weight of
Qualifying Pigs from 8 to 12 pounds.  To the extent that the average weight of a
shipment of Qualifying Pigs exceeds 12 pounds per pig, the purchaser will pay an
additional $1.00 per pound per pig.  To the extent that the average weight of a
shipment of Qualifying Pigs is less than 8 pounds per pig, the purchase price
will be decreased by $1.00 per pound per pig.

     Delivery of Pigs.  The Company will be responsible for obtaining, at the
Company's expense, all health permits necessary to qualify the pigs for
interstate shipment.  It is anticipated that all lots of Qualifying Pigs will be
weighed at the Company's expense at a state-inspected scale near the Company's
production facility.  Delivery is to be FOB shipping point, with the members
bearing the risk of loss during transit, and the trucks used to haul Qualifying
Pigs from the Company's production facility must be thoroughly cleaned and
disinfected prior to loading.  A member may inspect the lot of Qualifying Pigs
to be purchased by such member prior to loading.  After the delivery of pigs at
their destination, a member will have the right to seek an appropriate price
adjustment for any pig which is found not to be a Qualifying Pig.  Such
adjustment will be made following the Company's inspection of the subject pigs,
and will be determined through mutual agreement of the Company and the member.

     Term and Termination.  A member's Weaned Pig Agreement will be for an
initial term commencing on the date entered into and continuing for a period of
120 months after the date the first delivery of Qualifying Pigs is made to the
member thereunder, subject to earlier termination upon the occurrence of certain
events.  Weaned Pig Agreements will be extended automatically for succeeding one
year terms unless the member gives to the Company, not less than one year prior
to the expiration of the initial or any extended term, notice that the member
desires to terminate the Weaned Pig Agreement as of the expiration of such
initial or extended term.  The Company may terminate a member's Weaned Pig
Agreement if the member fails to purchase, pay for, and take delivery of any two
lots of Qualifying Pigs when and as made available to the member; provided,
however, that for each ten shares of Common Stock owned by a member, the number
of such failures necessary before the Company may terminate such member's
Agreement is increased by one.  The member may terminate the Weaned Pig
Agreement if the Company materially breaches any obligation or covenant in the
Agreement and such breach is not cured within 30 days following notice of such
breach given by the member to the Company.  Furthermore, if the first delivery
of Qualifying Pigs thereunder is not made within 24 months of the date of the
Weaned Pig Agreement, the member may terminate the Agreement within three months
after the expiration of such 24-month period.  If either party is prevented from
performing under the Weaned Pig Agreement because of reasons beyond its control
which make it commercially impossible to perform, however, then that party is
relieved from such performance so long as it remains commercially impossible to
perform.  A member's Weaned Pig Agreement automatically terminates if the member
assigns or transfers all shares of Class B Common Stock or Class C Common Stock,
as the case may be, from which the member's right to purchase lots of Qualifying
Pigs under the Agreement derives.  Except as described above, a member does not
have the right to terminate the Weaned Pig Agreement prior to the expiration of
the initial or any extended term thereof.  As noted above, the member's right to
terminate the Weaned Pig Agreement at the expiration of the initial or any
extended term thereof may be exercised only if the member gives notice to the
Company at least one year prior to the expiration of such initial or extended
term that the member desires to exercise such termination right.  The foregoing
termination rights constitute the member's exclusive rights of termination under
the Weaned Pig Agreements.  No member has the right to demand the return of or
to receive any of the member's capital from the Company as a result of the
termination of the Weaned Pig Agreements or otherwise and regardless of whether
demanded prior to the expiration of the initial or any extended term of the
Weaned Pig Agreements or at any time after the expiration of any such term.  The
Company is under no obligation to redeem or repurchase its Class B Common Stock
or Class C Common Stock prior to the expiration of the initial or any extended
term of the Weaned Pig Agreements or at any time after the expiration of any
such term.  See "Absence of Market" under Item 5.

     Effect of Purchaser Default.  If a member fails to purchase, pay for, and
take delivery of any lot of Qualifying Pigs when and as made available to the
member pursuant to the Weaned Pig Agreements, the member is responsible for the
damages and expenses incurred by the Company as a result of such failure.  In
particular, the member is liable for (a) the difference between the price
payable by the member for the Qualifying Pigs that member has failed to
purchase, pay for, and take delivery under the Agreement and the then current
market price for weaned pigs, (b) $3,000, which amount is intended to cover the
Company's administrative and other costs and expenses associated with such
failure to purchase, pay for, and take delivery of the Qualifying Pigs, and (c)
all costs of collection, enforcement, and prosecution of the Company's rights
and remedies under the Agreement or otherwise arising.  If a member fails to pay
promptly the damages and expenses incurred by the Company as a result of the
member's failure to purchase, pay for and take delivery of a lot of Qualifying
Pigs, such member will not be permitted to purchase any other lots unless and
until such damages and expenses are paid, and such member also will be
responsible for all damages and expenses accruing to the Company with respect to
lots that such member is not permitted to purchase as a result thereof.  In
addition to the member's responsibility for such damages and expenses, the
Company may pursue other remedies, including the termination of the member's
Weaned Pig Agreement.  If the member is prevented from performing under the
Weaned Pig Agreements because of reasons beyond the member's control which make
it commercially impossible to perform, however, then the member is relieved from
such performance so long as it remains commercially impossible to perform.  See
"Description of Business -- Feeder Pig Purchase Agreement -- Term and
Termination" and "-- Grant of Security Interest."

     Grant of Security Interest.  Pursuant to the Weaned Pig Agreements, a
member grants to the Company, as security for the performance of all of the
member's obligations under the Weaned Pig Agreements, a security interest in all
of the member's equity interest in the Company.  In this regard, the
certificates representing shares of Class B Common Stock and Class C Common
Stock will be retained by Alliance and members will be required to endorse
appropriate stock powers with respect to such certificates.  The Company's
security interest in the member's shares of Class B Common Stock and Class C
Common Stock is to be senior to all others, except for any permissible pledge or
other security interest granted in such shares by the member to any financial
institution for purposes of securing a loan used in financing the member's
acquisition of such shares and as otherwise agreed by the Company in its
discretion.  A member's failure to perform his purchase obligation under the
Weaned Pig Agreements, among other occurrences, may result in the Company's
foreclosure on the security interest in the member's Class B Common Stock or
Class C Common Stock, as the case may be.  See "Absence of Market" under Item 5.

     Warranties.  The Company makes no warranties, express or implied, with
respect to weaned pigs produced by it, except as expressly provided in the
Weaned Pig Agreements.  The Company specifically disclaims any warranties of
merchantability or fitness for a particular purpose and makes no warranty as to
any specific level of performance with respect to any pigs sold thereunder.

     Arbitration.  Any controversy arising out or relating to a Weaned Pig
Agreements or any breach thereof (other than certain controversies that include,
but are not limited to, controversies arising out of a member's failure to
purchase, pay for, and take delivery of any lot of Qualifying Pigs and the
Company's exercise of any rights or remedies related thereto) is required to be
submitted to binding arbitration under the Weaned Pig Agreements.  Arbitration
hearings are to take place in Denver, Colorado, or at such other location as the
Company and such member may agree, with judgment upon the award rendered by the
arbitrator being entered in any court having jurisdiction.


ITEM 2. DESCRIPTION OF PROPERTY.

     As of the date of this report, the Company conducted operations from its
five existing 2,450-sow feeder pig production facilities located in Yuma County,
Colorado (approximately 150 miles east of Denver), and from its one existing
2,450-sow production facility in Wayne County, Illinois (approximately 100 miles
east of St. Louis, Missouri), and was in the process of developing one
additional feeder pig facility of comparable size in Wayne County, Illinois.  As
of the date of this report, the Company has commenced preliminary development
activities with respect to a sixth 2,450-sow feeder pig production facility in
Yuma County, Colorado.  As of the date of this report, the Company does not have
any weaned pig production facilities.  The original Yuma County, Colorado feeder
pig production facility was constructed in a configuration different than that
employed with respect to the Company's other facilities and is anticipated to be
different than that employed for future feeder pig production facilities.  The
original facility consists of six separate buildings, including two breeding
buildings, two gestation buildings, and two farrowing buildings, all of which
are situated together on an approximately 160 acre site with a separately
accessed nursery building, while each of the Company's other facilities consist
of a three-building sow breeding, gestation and farrowing complex situated
together, with a separately accessed nursery building.   Management believes
that the condition of its facilities presently is adequate for the Company's
business, and that its facilities are adequately covered by insurance.  Each of
the existing facilities, including land and buildings, was constructed for
between $2,243,000 and $2,495,000, and has been or will be pledged as security
for the Company's loan from CoBank under the terms of a deed of trust/mortgage.

     Between September and December 1995, the Company purchased approximately
1,000 acres of real property in Yuma County, Colorado, upon which the Company
has developed one feeder pig production facility and holds the remaining acreage
for the development of additional production facilities (the "Additional
Colorado Property").  As of the date of this report the Company has commenced
preliminary development activities with respect to one additional feeder pig
facility on this property.  The acquisition cost of this Additional Colorado
Property was approximately $760,000.  The Company obtained funding for the
purchase of the Additional Colorado Property from the proceeds of a loan
obtained from Farmland.  In conjunction with this loan, the Company delivered to
Farmland a promissory note evidencing the debt providing for the amortization of
the loan over a ten-year period, at a variable rate equal to CoBank's prime
rate.  As of August 31, 1997, CoBank's prime rate was 8.50%.  The payment
schedule of the promissory note requires that the Company make interest-only
payments for the life of the loan, with a final balloon payment of the principal
at the expiration of the ten-year term.  To secure the obligations of the
promissory note, the Company has agreed to execute a deed of trust in favor of
Farmland covering all of the Additional Colorado Property, which deed of trust
is second in priority to that of CoBank with respect to the production facility
constructed thereon.  See "Certain Relationships and Related Transactions--
Farmland--Real Estate Loans"under Item 12.

     As of the date of this report, the Company has acquired approximately 442
acres of real property in Wayne County, Illinois, including a 90 acre tract
acquired pursuant to the exercise of the option referred to below.  The Company
has developed one feeder pig production facility on these 442 acres.  In
addition, as of the date of this report the Company was in the process of
developing two additional feeder pig facilities on this property.  See
"Description of Business--Expansion"  under Item 1.

     In November 1996, the Company entered into a contract pursuant to which the
Company has been granted the option to purchase approximately 500 acres of real
property in Wayne County, Illinois (the "Option Property").  Under the terms of
this option contract, if the Company fails to fully exercise the option as to
the entire Option Property prior to November 1998, the Company shall be
responsible for a $150,000 liquidated damages payment to the owner of the Option
Property.  The Company's responsibility for this liquidated damages payment is
secured by a stand-by letter of credit issued by CoBank.  Until the expiration
of this letter of credit, the revolving term credit available to the Company
will be reduced by $150,000.  In November 1996, the Company exercised its rights
under this option contract to acquire an approximately 90 acre tract of the
Option Property, including 45 acres  (the "45 Acre Tract") on which the Company
is developing a second Illinois pig production facility.  The Company obtained
funding for the purchase of the 45 Acre Tract from the proceeds of a loan
obtained from Farmland, which has been repaid in full.  See "Certain
Relationships and Related Transactions--Farmland--Real Estate Loans"under Item
12.

     The Company has contracted with Central Confinement, Inc., Columbus,
Nebraska, for the construction of the sixth facility situated in Yuma County,
Colorado.  Design and construction of these facilities is being handled by the
contractor on a "turn-key" basis.  The Company is responsible for obtaining all
applicable permits and arranging for site excavation, fill sand, driveways,
electrical service, wells and fresh water, manure pipes, manure storage,
domestic sewer system, and exterior recycle pump and exterior pipes from the
buildings.  Farmland is coordinating these services for the Company.

     The Company maintains its administrative offices at 302 Idlewild Street in
Yuma, Colorado.  This office space has been made available to the Company by
Farmland at no cost to the Company.


ITEM 3.  LEGAL PROCEEDINGS.


     There are no material pending legal proceedings to which the Company is a
party or to which any of its property is subject.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.


     No matter was submitted to a vote of the security holders of the Company
during the fourth quarter of the fiscal year ended August 31, 1997.


                                    PART II


ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.


ABSENCE OF MARKET

     There is no public trading market for the Company's Common Stock.  The
Common Stock is subject to provisions of the Colorado Cooperative Association
Law and the Company's Articles of Incorporation and Bylaws which restrict the
transferability of the Common Stock.  In particular, the Colorado Cooperative
Association Law and the Company's Articles of Incorporation provide that the
certificates of membership in the Company (which also represent shares of Common
Stock of the Company) shall not be assignable or transferable except upon
consent of the Board of Directors, and that the Company shall have the right in
its Bylaws to limit the transfer or assignment of membership and the terms and
conditions upon which transfers or assignments may be allowed.  The Company's
Bylaws provide that the equity interests issued by the Company may not be
assigned or transferred, except upon the consent of the Company's Board of
Directors, and that the Company's Board of Directors may not give such consent
unless any such assignee or transferee of Class A Common Stock executes and
delivers to the Company a Feeder Pig Purchase Agreement, any such assignee or
transferee of Class B Common Stock executes and delivers to the Company a Weaned
Pig Purchase Agreement and any such assignee or transferee of Class C Common
Stock executes and delivers to the Company a Class C Weaned Pig Purchase
Agreement.  The transfer agent for the Common Stock is the Secretary of the
Company.

     In addition to the foregoing transfer restrictions, the Company's Bylaws
give the Company the right to purchase a member's Common Stock under certain
circumstances, which may adversely affect transferability.  Such right is in
addition to any right the Company may have to foreclose on the security interest
in member's Common Stock pursuant to the Feeder Pig Purchase Agreement, Weaned
Pig Purchase Agreement or Class C Weaned Pig Purchase Agreement, as the case may
be.  In particular, the Company has the option under its Bylaws to purchase a
member's shares of Common Stock upon the occurrence of certain specified events
(a) by tendering to the member (i) the lesser of (A) the price paid to the
Company for such investor's shares of Common Stock, and (B) the book value of
the Common Stock and capital credits associated therewith, less (ii) any
indebtedness due the Company from the member, or (b) by tendering to the member
a nonvoting certificate of participation representing the member's interest at
the time of such tender in a face amount equal to the amount specified in clause
(a) above.  The occurrences giving rise to such option include the following
events: (a) a member's termination of a Feeder Pig Purchase Agreement, Weaned
Pig Purchase Agreement or Class C Weaned Pig Purchase Agreement, as the case may
be, without having executed and delivered a replacement for such Agreement or a
member's failure to be a party to such Agreement, and (b) the Company's Board of
Directors by resolution finds that a member has (i) intentionally or repeatedly
violated any provision of the Company's Articles of Incorporation or Bylaws,
(ii) breached a Feeder Pig Purchase Agreement, Weaned Pig Purchase Agreement or
Class C Weaned Pig Purchase Agreement, as the case may be, or materially
breached any other contract with Company, (iii) remained indebted to the Company
for 90 days after such indebtedness first becomes payable, or (iv) willfully
obstructed any lawful purpose or activity of the Company.  In the event the
Company exercises either option, the voting stock of the member shall be
canceled, and the member shall thereafter have no voting rights in the Company.
The Company is under no obligation, however, to redeem or repurchase an
investor's Common Stock at any time.  See "Description of Business -- Feeder Pig
Purchase Agreement" and "-- Weaned Pig Purchase Agreements" under Item 1.

HOLDERS

     The authorized capital stock of the Company consists of 5,000 shares of
(Class A) common stock, $.01 par value per share, 2,500 shares of Class B common
stock, $.01 par value per share, and 2,500 shares of Class C common stock, $.01
par value per share.  As of August 31, 1997, there were 119 shares of Class A
Common Stock issued and outstanding, which were held of record by 21
stockholders, and no shares of Class B Common Stock or Class C Common Stock
issued and outstanding.  Only producers of agricultural products, associations
of such producers, and federations of such associations who have executed and
delivered to the Company a Feeder Pig Purchase Agreement may own Class A Common
Stock, only producers of agricultural products, associations of such producers,
and federations of such associations who have executed and delivered to the
Company a Weaned Pig Purchase Agreement may own Class B Common Stock, and only
producers of agricultural products, associations of such producers, and
federations of such associations who have executed and delivered to the Company
a Class C Weaned Pig Purchase Agreement may own Class C Common Stock.  Only
stockholders of the Company may be members of the Company. Except as otherwise
specifically described under this "Holders" caption, the powers, preferences and
rights of the Class A Common Stock, Class B Common Stock and Class C Common
Stock are in all respects identical. To the extent permitted by applicable law,
the Board of Directors of the Association is authorized to provide by resolution
for the issuance of shares of stock of any class or of any series of any class
at any time and to determine, prior to the issuance of any shares of stock of
that class or series, the designations, preferences, limitations and relative
rights, if any, thereof.

     Except as described in the immediately following sentence, holders of Class
A Common Stock and Class B Common Stock are entitled to one vote for each share
held on all matters submitted to a vote of stockholders and holders of Class C
Common Stock are entitled to three-fourths of one vote for each share held on
all matters submitted to a vote of stockholders.  During any period in which the
Company has borrowed money from a lender subject to regulations of the Farm
Credit Administration regarding loan policies and operations (such as the
Company's current lender), (i) no cooperative association stockholder is
permitted to vote shares of Common Stock representing 25% or more of the shares
then outstanding with respect to any matter as to which members are not entitled
to vote separately as a group or class and (ii) no cooperative association
stockholder is permitted to vote shares of Common Stock representing 25% or more
of the shares of any class then outstanding with respect to any matter as to
which members are entitled to vote separately as a group or class.  A majority
of the outstanding shares of Common Stock entitled to vote constitutes a quorum
at any stockholder meeting, except that if any class of capital stock is
entitled to vote separately as a class or group, such a quorum must also be
obtained with respect to such class.  The affirmative vote of at least two-
thirds of the shares represented at a meeting at which a quorum is present is
required to amend the Company's Articles of Incorporation, to approve certain
mergers, consolidations or sales of all or substantially all of the Company's
assets and to approve certain other matters.  Holders of the Class A Common
Stock, holders of the Class B Common Stock and holders of the Class C Common
Stock must vote separately as groups or classes with respect to amendments to
the Articles of Incorporation that alter or change the designation, preferences,
limitations or relative rights of their respective classes of stock so as to
affect them adversely and with respect to such other matters as may require
group or class votes under applicable law.  Holders of the Common Stock do not
have cumulative voting rights in the election of directors or preemptive rights
to purchase additional shares of Common Stock, and have no subscription,
redemption or conversion rights.

PATRONAGE DISTRIBUTIONS AND ABSENCE OF DIVIDENDS

     No dividends have been, or will be, paid by Alliance on its Common Stock.
The Company intends to distribute, however, at least annually, all of its net
margins, if any, as patronage distributions to its stockholders on the basis of
the quantity or value of business done by the Company with or for each
stockholder with respect to pigs sold pursuant to the Feeder Pig Purchase
Agreements, Weaned Pig Agreements or the Swine Production Services Agreement.
The Company's "net margins" for this purpose generally are equal to the
Company's net income under generally accepted accounting principles (taxable
income through and including August 31, 1997) attributable to patronage sourced
business done with or for the Company's members (determined before reduction for
patronage distributions paid by the Company).  In this regard, the Company will
compute its net income or taxable income, as the case may be, separately for
each group of members (including successors and permitted assigns) whose shares
of the Company's Common Stock originally were issued in connection with the
Company's acquisition or development of one or more feeder or weaned pig
production units financed in part thereby.  A stockholder's share of the
Company's net margins will be payable to him or her after the close of each
fiscal year.  The Company's Board of Directors has the right to pay the
patronage distribution in qualified written notices of allocation, non-qualified
written notices of allocation, cash or any combination thereof.  The written
notices of allocation will be issued in the form of Alliance capital credits.
The extent of the cash portion of the patronage distributions will be determined
annually and will depend upon the Company's financial condition, results of
operation, capital commitments and other factors deemed relevant by the Board of
Directors.  The Company has entered into various loan agreements and other
documentation with its existing lender which restrict the Company's ability to
pay patronage distributions in cash.  See "Description of Business -- Financing"
under Item 1.  The Company's Board of Directors authorized, with the consent and
approval of CoBank, the payment of a $670,167 rebate to its members with respect
to feeder pigs sold to such members by Alliance during the fiscal year ended
August 31, 1996. After the payment of this rebate, the Company does not intend
to make any future rebate payments to its members.


ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.


EXCEPT FOR THE HISTORICAL INFORMATION CONTAINED HEREIN, THE STATEMENTS MADE IN
THIS REPORT ON FORM 10-KSB ARE FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND
UNCERTAINTIES.  ALLIANCE'S ACTUAL RESULTS, FINANCIAL CONDITION OR BUSINESS COULD
DIFFER MATERIALLY FROM ITS HISTORICAL RESULTS, FINANCIAL CONDITION OR BUSINESS,
OR THE RESULTS OF OPERATIONS, FINANCIAL CONDITION OR BUSINESS CONTEMPLATED BY
SUCH FORWARD-LOOKING STATEMENTS.  FACTORS THAT COULD CAUSE OR CONTRIBUTE TO SUCH
DIFFERENCES INCLUDE, BUT ARE NOT LIMITED TO, THOSE DISCUSSED BELOW UNDER THE
CAPTION "FACTORS THAT MAY AFFECT FUTURE RESULTS OF OPERATIONS, FINANCIAL
CONDITION OR BUSINESS," AS WELL AS THOSE DISCUSSED ELSEWHERE IN ALLIANCE'S
REPORTS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

     GENERAL.  The Company commenced operations in July, 1994, following its
acquisition of the entire equity ownership rights and interest in Yuma LLC, a
Colorado limited liability company in which Farmland and Yuma Cooperative owned
71.5% and 28.5%, respectively, of the outstanding equity interests.  Subsequent
to the Company's acquisition of Yuma LLC, Yuma LLC was dissolved and liquidated
and Alliance received all assets and liabilities of Yuma LLC and continued the
feeder pig production operations of Yuma LLC as described herein.

     FISCAL YEARS ENDED AUGUST 31, 1997 AND 1996.  Shipments of feeder pigs were
higher for the fiscal year ended August 31, 1997 than in the prior year.
Alliance shipped 231,598 feeder pigs during fiscal 1997 compared to
148,926 feeder pigs shipped during fiscal 1996, an increase of approximately
56%.  Net sales for the fiscal year ended August 31, 1997 increased to
$13,669,706 from $7,037,927 for the prior year, an increase of $6,631,779 or
approximately 94%.  This increase in volume and sales dollars is primarily due
to six units operating for the fiscal year ended August 31, 1997 versus four
units for the fiscal year ended August 31, 1996.

     Alliance's sales for the fiscal year ended August 31, 1996 have been
reduced by the accrual of a rebate of  $670,167 that was paid to its members
with respect to feeder pigs sold to such members by Alliance during such fiscal
year.  See "Patronage Distributions and Absence of Dividends" under Item 5.
Alliance incurred positive gross margins of $2,447,537 and $615,089 for fiscal
1997 and 1996, respectively.  This improvement in gross margin is primarily due
to the nature of the contractual pricing arrangements applicable to the
Company's sale of feeder pigs to its members.  The selling price for Alliance's
feeder pigs is based on, among other things, the 12-month rolling average of
operating costs per pig.  For the fiscal year ended August 31, 1997, the
Company's operating costs at the time pigs were sold (the then current operating
costs) were lower than the historical rolling average of operating costs by
$1.39 per head sold.  For the fiscal year ended August 31, 1996, the Company's
then current operating costs exceeded the historical rolling average of
operating costs by $0.09 per head sold.

     Sales to Farmland (including sales to Farmland of Yuma Cooperative's share
of feeder pigs produced by the Company) for fiscal 1997 and 1996 were $7,924,763
and $5,035,160, respectively.   The average net sales price per head was $59.02
and $48.12 ($52.62 prior to giving effect to a $4.50 per pig rebate) and the
average industry market price per head was $56.84 and $41.15 during 1997 and
1996, respectively.

     Alliance recorded start-up costs of $281,025 and $426,926 relating to the
operation of new production facilities during the fiscal years ended August 31,
1997 and 1996, respectively.  All of the costs for the fiscal year ended August
31, 1997 and all of the costs for the fiscal year ended August 31, 1996 were
comprised of utilities, feed, labor and other general expenses prior to the
operation of the new feeder pig production facilities.

     Gain on sale of breeding stock was $94,123 for the fiscal year ended August
31, 1997 as compared to a loss of $226,738 for the prior year period.  This
increase is attributable to an unusually strong market for hogs and the culling
by Alliance of a larger percentage of its herd, which consists of a higher
quality of animal.  In connection with the ongoing repopulation of the Company's
Colorado facilities, Alliance is culling all of its DeKalb breeding stock and
replacing it with P.I.C. genetics.

     Administrative expenses were $424,565 for the fiscal year ended 1997
compared to $369,787 for the prior year period.  This increase reflects the
increased operations and includes higher administrative, payroll and
professional fees.

     Interest expense of $1,321,984 for fiscal 1997 compared to $1,001,329 for
fiscal 1996 was incurred in financing the development of the six existing and
one new feeder pig facilities.  The increase reflects an increase in outstanding
borrowings in 1997.

     Alliance earned net income of $658,295 for the fiscal year ended August 31,
1997 compared to a net loss of $1,343,087 for the prior year period.  The fiscal
1997 net income was attributable to improved gross margins resulting from the
per pig sales price exceeding operating costs, caused in part by improved
productivity as well as lower corn prices from fiscal 1996.  The fiscal 1996
loss was attributable to $426,926 of start-up expenses related to the
development of two feeder pig production facilities and a loss of $226,738 on
the sale of breeding stock.  The remaining amount of the 1996 net loss was
primarily attributable to then current costs exceeding the rolling average cost
that per pig prices were based on, caused in part by high death loss due to herd
health issues, as well as rising corn prices.  In addition, the Company's
operating costs at the time pigs were sold during part of fiscal 1997 and all of
fiscal 1996 exceeded the historical rolling average of operating costs from
which the selling price for pigs was based.  The selling price for Alliance's
feeder pigs is based on the 12-month rolling average of operating costs per pig,
the debt service financing cost per pig, and a $4.50 per pig production margin.
During all of fiscal 1996, however, the Company accrued a $670,167 rebate that
was intended to provide each member with a $4.50 payment per pig sold to such
member during fiscal 1996; thereby effectively eliminating the production
margin.   There was no accrual of a rebate during fiscal 1997.  In addition
operating risks and uncertainties associated with any business, the Company's
ability to generate net income is limited by: any start-up expenses that are
incurred with respect to facilities development and the Company's selling price
formula for feeder pigs that contains a $4.50 production margin.

     FISCAL YEARS ENDED AUGUST 31, 1996 AND 1995.  Shipments of feeder pigs were
higher for the fiscal year ended August 31, 1996 than in the prior year's
period.  Alliance shipped 148,926 feeder pigs during fiscal 1996 compared to
46,858 feeder pigs shipped during fiscal 1995, an increase of approximately
218%.  Net sales for the fiscal year ended August 31, 1996 increased to
$7,037,927 from $1,554,113 for the prior year, an increase of $5,438,814 or
approximately 350%.  This increase in volume and sales dollars is primarily due
to four units operating for the fiscal year ended August 31, 1996 versus one
unit for the fiscal year ended August 31, 1995 and the change in Alliance's
contract price, effective July 13, 1995, to include $4.50 per pig in addition to
the financing cost and operating cost on which the price was previously based.

     Alliance's sales for the fiscal year ended August 31, 1996 have been
reduced by the accrual of a rebate of  $670,167 that is intended to be paid to
its members with respect to feeder pigs sold to such members by Alliance during
such fiscal year.  See "Patronage Distributions and Absence of Dividends" under
Item 5.  Alliance incurred a positive gross margin of $615,089 and a negative
gross margin of $282,275 for fiscal 1996 and 1995, respectively.  This
improvement in gross margin is primarily due to the nature of the contractual
pricing arrangements applicable to the Company's sale of feeder pigs to its
members.  The selling price for Alliance's feeder pigs is based on, among other
things, the 12-month rolling average of operating costs per pig.  For the fiscal
year ended August 31, 1996, the Company's operating costs at the time pigs were
sold (the then current operating costs) exceeded the historical rolling average
of operating costs by $0.09 per head sold.  For the fiscal year ended August 31,
1995, the Company's then current operating costs exceeded the historical rolling
average of operating costs by $6.37 per head sold.  The substantial difference
between fiscal 1995's then current operating costs and historical rolling
average operating costs is principally due to Alliance's culling of a greater
portion of its herd than is customary in order to accommodate their replacement
with multiplier unit animals, in addition to the resulting decline in
production.

     Sales to Farmland (including sales to Farmland of Yuma Cooperative's share
of feeder pigs produced by the Company) for fiscal 1996 and 1995 were $5,035,160
and $1,467,069, respectively.   The average net sales price per head was $48.12
and $33.16 and the average industry market price per head was $41.15 and $32.17
during 1996 and 1995, respectively.

     Alliance recorded start-up costs of $426,926 and $754,756 relating to the
operation of new production facilities during the fiscal years ended August 31,
1996 and 1995, respectively, and conversion of the existing unit to a multiplier
unit during the fiscal year ended August 31, 1995.  All costs for the fiscal
year ended August 31, 1996 and $647,751 of the costs for the fiscal year ended
August 31, 1995 were comprised of utilities, feed, labor and other general
expenses prior to the operation of the new feeder pig production facilities, and
$107,005 of the costs for the fiscal year period ended August 31, 1995 were
attributable to the conversion of the existing 2,450-sow feeder pig unit from a
commercial sow unit to a multiplier sow unit.

     Loss on sale of breeding stock was $226,738 for the fiscal year ended
August 31, 1996 as compared to $112,797 for the prior year period.  This
increase is attributable to the existence of newly developed facilities in
fiscal 1995, from which culling of animals was not necessary until near the end
of that fiscal year, as compared to more mature facilities in fiscal 1996, from
which culling of animals occurred throughout that fiscal year.

     Administrative expenses were $369,787 for the fiscal year ended 1996
compared to $101,927 for the prior year period.  This increase reflects the
increased operations and includes higher administrative, payroll and
professional fees.

     Interest expense of $1,001,329 for fiscal 1996 compared to $289,082 for
fiscal 1995 was incurred in financing the development of the four existing and
two new feeder pig facilities.

     Alliance incurred a net loss of $1,343,087 for the fiscal year ended August
31, 1996 compared to a net loss of $1,513,328 for the prior year period.  The
fiscal 1996 loss was attributable to $426,926 of start-up expenses related to
the development of two feeder pig production facilities and a loss of $226,738
on the sale of breeding stock.  The remaining amount of the net loss is
primarily attributable to current costs exceeding the rolling average cost that
per pig prices are base on, caused in part by high death loss due to herd health
issues, as well as rising corn prices.  The fiscal 1995 loss was attributable to
$754,756 of start-up expenses related to facilities development and a loss of
$112,797 on the sale of breeding stock.  In addition, the Company's operating
costs at the time pigs were sold during both fiscal 1996 and 1995 exceeded the
historical rolling average of operating costs from which the selling price for
pigs was based. During all of fiscal 1996, the selling price for Alliance's
feeder pigs was based on the 12-month rolling average of operating costs per
pig, the debt service financing cost per pig, and a $4.50 per pig production
margin.  The Company accrued a $670,167 rebate, however, that is intended to
provide each member with a $4.50 payment per pig sold to such member during
fiscal 1996; thereby effectively eliminating the production margin.  The $4.50
per pig production margin was not added to the price of feeder pigs sold during
fiscal 1995 until after July 13, 1995.  In addition operating risks and
uncertainties associated with any business, the Company's ability to generate
net income is limited by any start-up expenses that are incurred with respect to
facilities development, by the Company's selling price formula for feeder pigs
that contains a $4.50 production margin, and by the possible return of all or a
portion of such rebate to the Company's members.

     LIQUIDITY AND CAPITAL RESOURCES.  At August 31, 1997, the Company reported
a working capital deficit of $114,425 and total assets of $24,380,406.  The
Company issued 17 shares of Class A Common Stock in August 1997 for aggregate
net proceeds of $1,231,584.  The Company has used these funds, in combination
with borrowings of $1,456,331 through August 31, 1997, for the development,
population, and start-up of one 2,450-sow feeder pig production facility in
Wayne County, Illinois (including the repayment of a $1,360,000 loan made by
Farmland).

     As of the date of this report, the Company has 119 shares of Class A Common
Stock issued and outstanding, 36 issued and outstanding shares of Class B Common
Stock and no issued and outstanding shares of Class C Common Stock and is
offering an additional 34 shares of Class A Common Stock, 18 shares of Class B
Common Stock and 72 shares of Class C Common Stock to qualified prospective
investors.  As of August 31, 1997, Alliance had $1,382,000 immediately available
to it under its credit facility with CoBank.  Another $211,000 of term loans is
to be made available by CoBank approximately 90 days following completion of
construction of the Company's facilities under development.  Of the $1,382,000
available at August 31, 1997 and the $211,000 to be made available under the
credit facility, Alliance anticipates that approximately $699,000 would be
required to complete construction of the newest unit and $674,000 would be
available for working capital purposes due to the previous funding of some of
such construction costs with working capital.  In the opinion of management,
these arrangements for debt capital are adequate for Alliance's present
operating and capital plans.  In the event that an additional 34 shares of Class
A Common Stock, 18 shares of Class B Common Stock and 72 shares of Class C
Common Stock are issued and sold prior to the expiration of the CoBank loan
commitment, another $14,080,000 would be eligible for borrowing.  The net
proceeds from any such sale of Common Stock, together with such additional
borrowings, would be used for future capital expansion of up to two additional
feeder pig production facilities and six weaned pig production facilities.
There can be no assurance that any additional shares of Common Stock will be
sold and that the additional borrowing required for such capital expansion would
be available.

     During the fiscal year ended August 31, 1997, Alliance incurred capital
expenditures of $1,456,331 for the construction of a new feeder pig production
facility in Wayne County, Illinois.  The remaining capital expenditures were for
replacement of breeding stock and the completion of construction related to six
of the Company's existing facilities.

     On May 19, 1995, the Company entered into various loan documents with
CoBank related to a $23,600,000 secured credit facility.  This credit facility
provided for up to $18,850,000 of  non-revolving term debt and $4,750,000 of
revolving term credit.  Proceeds from the term debt may be used for construction
of feeder pig production facilities and are advanced by CoBank as construction
costs are incurred by Alliance.  Proceeds from revolving term credit may be used
for working capital and other purposes.  The actual advance of funds under this
credit facility is subject to the satisfaction of certain conditions precedent
and may be withdrawn or terminated by CoBank under certain circumstances.  No
assurances can be given that the funding conditions precedent will be satisfied
and that the Company will be able to obtain sufficient financing when needed, or
that alternative sources of financing will be available on acceptable terms.  In
addition, the unused portion of the credit facility expires December 31, 1997
with respect to the non-revolving term debt and June 20, 2006 with respect to
the revolving term credit.  The Company has obtained a commitment from CoBank
for an approximately $35,255,000 credit facility to replace the existing credit
facility and to provide debt financing for use in the development of feeder and
weaned pig production facilities.  As of the date of this report, Alliance was
engaged in negotiations with CoBank concerning the preparation of definitive
loan documentation with respect to such commitment.  No assurances can be given
that such negotiations will be successful and that definitive loan documentation
will be entered into on favorable terms, if at all.  See "Description of
Business -- Financing" under Item 1.

     The availability of non-revolving term debt and revolving term credit under
the CoBank credit facility is subject to specified equity investment levels in
the Company being satisfied.  As of August 31, 1997, $443,869 of term loans were
immediately available to the Company, $211,000 of terms loans were available
upon CoBank's final acceptance and approval of the feeder pig production
facilities then under development, and $938,131 of revolving term credit was
immediately available.  The availability of $4,220,000 of unused term loans and
$1,220,000 of revolving term credit under the CoBank credit facility is
restricted and may be made available to the Company only to the extent that
additional equity investment is made in the Company.  With respect to each
additional equity investment of $1,360,000 obtained by the Company (e.g., 17
shares of Class A Common Stock sold for at least $80,000 each), the Company is
entitled to obtain advances under the credit facility of $2,720,000 ($2,110,000
of term loans and $610,000 of revolving term credit), up to an aggregate of
$8,160,000.  The Company has agreed with CoBank and Farmland that it may obtain
an advance under the CoBank credit facility of $2,720,000 and a loan from
Farmland of $1,360,000, without the necessity of satisfying the additional
equity investment requirement.  See "Description of Business--Financing" under
Item 1.

     Installments of principal and interest under the Company's credit facility
are payable monthly in arrears by the 20th day of the month.  Principal payments
with respect to the initial $8.3 million of non-revolving term loans are to be
made in 114  monthly installments of $72,500 each, beginning January 20, 1996,
with the remaining unpaid balance being due and payable on July 20, 2005.
Principal payments pursuant to the loan terms with respect to each $2,100,000 of
new non-revolving term loans are to be made in monthly installments of $18,700
each, beginning on the 20th day of the eighteenth month following the date of
the initial advance of such $2,110,000 loan.  Principal payments pursuant to the
loan terms with respect to the revolving term loan are to be made in 24 equal
monthly installments of the principal that is outstanding as of the June 20,
2006 expiration of the revolving loan commitment, beginning on the 20th day of
the month following the payment in full of the new non-revolving term loan (but
in no event later than March 20, 2008).  Interest accrues on the outstanding
principal balance of the loan at a rate equal to either (i) a variable rate
equal to CoBank's then national variable rate plus 1.25%, or (ii) CoBank's then
quoted rates for fixed rate loans, as may be elected from time to time by the
Company.  As of August 31, 1997, interest accrued on the outstanding principal
balance of the loan at a rate of 9.75% per annum (calculated by adding 125 basis
points to CoBank's national variable rate of 8.50% in effect as of such date).
See "Description of Business -- Financing" under Item 1.

     During the course of the loan, the Company may be required to make equity
investments at a rate not to exceed 1% of the average five-year principal loan
balance (which equity investments may be satisfied out of CoBank's non-cash
patronage distributions) until the Company meets CoBank's target level of equity
investment, which currently is 11.5% of the Company's average five-year
principal loan balance.  In addition, the Company is required to comply with
various affirmative and negative covenants, including but not limited to (i)
maintenance of at least $2,250,000 of equity, plus $550,000 of equity for each
facility developed by the Company after its initial four facilities ($3,900,000
of equity was required at August 31, 1997 and the Company had $6,496,168 of
equity at such date), (ii) maintenance of modified working capital (calculated
as current assets, plus available revolving term credit, minus current
liabilities (excluding the current portion of term debt payments)) of at least
$210,000, plus $98,000 of modified working capital for each facility developed
by the Company after its initial four facilities ($504,000 of modified working
capital was required at August 31, 1997 and the Company had $2,086,406 of
modified working capital at such date), (iii) provision of monthly financial
statements and audited annual financial statements to CoBank, (iv) restrictions
on the occurrence of additional indebtedness, (v) restrictions on certain liens,
mergers, sales of assets, investments, guaranties, loans, advances and business
activities unrelated to existing operations, and (vi) restrictions on the
declaration and payment of the cash portion of patronage distributions and other
distributions or allocations of the Company's earnings, surplus or assets.  The
Company was in compliance with each of these covenants as of August 31, 1997.
See "Description of Business -- Financing" under Item 1.

     The Company intends to continue to operate its existing feeder pig
production facilities and sell feeder pigs produced therefrom.  Funding of the
ongoing operation of its facilities will be provided from the sale of feeder
pigs and available working capital.  The Company believes that such funding
sources are adequate for current operations.  The Company also intends to
develop weaned pig production facilities and sell weaned pigs produced
therefrom.

     Cash provided by Alliance in its operating activities totaled $1,606,399
during the fiscal year ended August 31, 1997 compared with $280,449 of cash used
by Alliance in its operating activities in the prior year period  This increase
in cash provided reflects the improvement in operating results in fiscal 1997
compared to those in fiscal 1996.

     Major sources of cash for the fiscal year ended August 31, 1997 included
$1,231,584 received from the issuance and sale of 17 shares of the Company's
Class A Common Stock, $1,877,131 of long term debt, and an increase of $300,869
in the Company's revolving term credit.  Major uses of cash include $5,896,799
for capital additions or improvements, $743,925 for acquisition of additional
inventory and $870,000 for payments applied to the Company's outstanding long
term debt.

     INCOME TAXES.  The Company operates as a cooperative that is not exempt
from federal income taxes and, therefore, is subject to taxes on all income not
paid or allocated to members.  Deferred income taxes have not been provided
because all sales since inception have been to members and all future sales are
anticipated to be to members.

     Alliance incurred patronage-sourced losses through August 31, 1996 which
were not allocated to members.  These patronage-sourced losses are therefore
available to offset future patronage-sourced income.  During the year ended
August 31, 1997, a portion of patronage-sourced losses were used to offset 1997
patronage-sourced income.  At August 31, 1997, approximately $3,594,000 of
patronage-sourced losses were available to offset future patronage-sourced
income.  These losses expire in 2009 through 2011.

     INFLATION.  Inflation is believed to have a relatively minor impact on the
operations of the Company.  While certain costs, such as salaries, are affected
by inflation, the Company believes that the factors which most affect its
results of operations are the cost of feed and other inputs and the productivity
of the breeding stock herd which are each influenced by a variety of factors.
Further, the Company will sell its feeder and weaned pig production under terms
which cause the sales price of feeder pigs to be adjusted for changes in the
cost of production per unit, including increases in costs caused by inflation.
The precise impact of inflation on the Company's costs is not readily
ascertainable.

FACTORS THAT MAY AFFECT FUTURE RESULTS OF OPERATIONS, FINANCIAL CONDITION OR
BUSINESS

     In order to take advantage of the safe harbor provisions for forward-
looking statements contained in Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended,
added to those Acts by the Private Securities Litigation Reform Act of 1995,
Alliance is identifying important risks and uncertainties that could cause
Alliance's actual results of operations, financial condition or business to
differ materially from its historical results of operations, financial condition
or business, or the results of operations, financial condition or business
contemplated by forward-looking statements made herein or elsewhere orally or in
writing.  Factors that could cause or contribute to such differences include,
but are not limited to, those factors described below.

     EARLY STAGE OF DEVELOPMENT.  Alliance was formed in May, 1994 (with its
predecessor, Yuma LLC, being formed in October, 1991) and is at an early stage
of development. Although the Company has been engaged in the production of
feeder pigs since July 1994 (which process includes the production of weaned
pigs), the Company has not engaged at all in the production of weaned pigs for
sale.  The Company is subject to all of the risks inherent in the establishment
of a new business and the operation of a business generally, including the need
for substantial capital to support its facilities development efforts, the need
to attract and retain qualified personnel and experienced management, the risks
related to facility location and construction, changes in market conditions and
costs, competition, inflation, production efficiency, quality control, herd
health, environmental and other governmental laws and regulations, and the other
risks described in this Report.  There can be no assurance that Alliance
successfully will implement its business plan to develop additional feeder pig
production facilities and weaned pig production facilities and realize any
significant economies of scale or that the feeder pigs and weaned pigs, as the
case may be, to be raised at such facilities will be made available to
Alliance's stockholders under the Feeder Pig Purchase Agreements, Weaned Pig
Purchase Agreements and Class C Weaned Pig Purchase Agreements in quantities
which are sufficient to meet the requirements of such stockholders and at prices
that are less than otherwise could be obtained from other sources.

     BREEDING STOCK.  The availability in sufficient numbers of genetically
consistent breeding stock that satisfies the characteristics required by the
Company and that can be obtained on acceptable terms and prices is critical to
the Company's operations.  No assurances can be given that the Company's
requirements for breeding stock will be satisfied on acceptable terms and
prices, if at all.  See "Business" under Item 1.

     HERD HEALTH.  The health of the breeding herd and pigs produced by Alliance
can greatly impact, and has greatly impacted, the profitability of Alliance.  In
the event that Alliance's breeding herd or feeder or weaned pig population
contracts a disease causing diminished breeding stock productivity, or extreme
mortality and morbidity, Alliance will face substantial cost or loss and its
operating results will be adversely affected.  In addition, herd health problems
could result in an increase in the price for pigs under the Feeder Pig Purchase
Agreements, Weaned Pig Purchase Agreements and Class C Weaned Pig Purchase
Agreements as well as a reduction in the pigs available for purchase by
stockholders under said Agreements.  Alliance and its members have suffered the
consequences referred to in this paragraph as a result of herd health problems.
Although Alliance's facilities have been designed in an attempt to allow for
disease separation between the facilities, large numbers of animals will be
raised together and may be vulnerable to disease.  No assurance can be given
that Alliance will be able to avoid herd health problems.  See "Business --
Feeder Pig Purchase Agreement" and "-- Weaned Pig Purchase Agreements" under
Item 1.

     VOLATILE INPUT COSTS.  Because the cost of feed and other supplies
constitute a substantial portion of the cost of producing a feeder or weaned
pig, Alliance's profitability is extremely sensitive to changes in the cost of
such inputs.  These costs are subject to substantial fluctuations based upon
regional and seasonal availability and demand, including those attributable to
crop conditions, weather and other factors.  A substantial increase in the cost
of these inputs, or a substantial decline in the availability of these inputs,
could materially adversely affect the performance of Alliance and result in the
price for pigs under the Feeder Pig Purchase Agreements, Weaned Pig Purchase
Agreements and Class C Weaned Pig Purchase Agreements, as the case may be, being
higher than otherwise could be obtained from other sources.  In this regard,
Alliance's average net sales price for its pigs exceeded the average industry
market price for pigs for the 1995 and 1996 fiscal years, as well as for six
months of fiscal 1997.  Moreover, Alliance's operating results are dependent
upon the sale price paid to Alliance for feeder or weaned pigs, which in turn is
or will be determined in part based on the twelve month historical rolling
average of operating costs incurred by Alliance in producing feeder pigs and the
five month historical rolling average of operating costs incurred by Alliance in
producing weaned pigs.  Actual changes in the sale price of feeder and weaned
pigs therefore will lag changes in the related operating costs and may adversely
affect Alliance's operating results, particularly in the event of sudden
movements, or continual increases, in such operating costs.  See "Business --
Purchase of Feed and Other Inputs," "-- Feeder Pig Purchase Agreement" and "--
Weaned Pig Purchase Agreements" under Item 1.

     ADEQUATE WATER SUPPLY.  Alliance's operations are dependent upon the
availability of an ample supply of pure water at reasonable cost.  Although
Alliance has obtained the necessary commercial water well permits to obtain the
water necessary to conduct its current operations in Colorado, Alliance has been
advised that it will be unable to obtain any new commercial well permits in
Colorado.  Accordingly, Alliance has found it necessary in Colorado to obtain
the water necessary for its operations through the purchase of more expensive,
irrigated land or other real property already having the necessary commercial
well permits.  No assurance can be given that Alliance will be able to obtain
the water permits necessary to enable it to expand its operations in Colorado,
Illinois or other locations selected by Alliance.  Alliance's inability to
obtain the necessary water well permits for the expansion of its operations
could have a material adverse effect on Alliance's business.

     OBLIGATION TO PURCHASE PIGS.  Each member of Alliance owning one or more
shares of Class A Common Stock has entered into a Feeder Pig Purchase Agreement,
pursuant to which such member is obligated to purchase his or her proportionate
share of Alliance's feeder pig production for an initial term of ten years and,
unless earlier terminated by the member, for succeeding one year renewal terms,
and each member of Alliance owning one or more shares of Class B Common Stock or
Class C Common Stock, as the case may be, must enter into a Weaned Pig
Agreement, pursuant to which such member is obligated to purchase his or her
proportionate share of Alliance's weaned pig production that is to be sold to
members as weaned pigs for an initial term of ten years and, unless earlier
terminated by the member, for succeeding one year renewal terms.  In each such
case, pigs will be made available to members of Alliance on a rotating schedule
determined and implemented by Alliance, with the number of lots made available
to a member and the frequency of availability being based upon the member's
proportionate ownership interest in Alliance's outstanding Class A Common Stock,
with respect to feeder pigs, the member's proportionate ownership interest in
Alliance's outstanding Class B Common Stock or Class C Common Stock, as the case
may be, with respect to weaned pigs, and the actual production of Qualifying
Pigs from the Company's facilities.  No assurance can be given that the
availability of feeder or weaned pigs to members will coincide with the member's
needs or capacity to take delivery.

     The purchase price for feeder and weaned pigs is established pursuant to a
formula consisting of the sum of the following factors:  the financing cost per
pig, the operating cost per pig, and a production margin of  $4.50 per pig, in
the case of feeder pigs, and of $0 to $4.50 per pig (as determined by Alliance
in its discretion), in the case of weaned pigs (all as defined in the Feeder Pig
Purchase Agreement or Weaned Pig Agreement, as the case may be).  The Company
believes the effect of such pricing is to shift the risks of increasing
production costs and lower market prices for pigs from the Company and to the
member.  No assurance can be given that the price for feeder and weaned pigs
under the Feeder Pig Purchase Agreement or Weaned Pig Agreement, as the case may
be, will be less than otherwise could be obtained from other sources.  Among
other factors, a substantial increase in operating costs, including the costs of
feed and other supplies and the costs associated with diminished breeding stock
health or productivity, or extreme mortality and morbidity, could result in a
higher price to be paid by members for feeder and weaned pigs than otherwise
could be obtained from other sources.  Moreover, the prevailing market price for
feeder and weaned pigs could decline below the price to be paid for pigs under
the Feeder Pig Purchase Agreement or Weaned Pig Agreement, as the case may be.
See "Business --  Feeder Pig Purchase Agreement" and "-- Weaned Pig Purchase
Agreements" under Item 1.

     UNPURCHASED AND EXCESS PIGS. Each member of Alliance owning one or more
shares of Class A Common Stock has entered into a Feeder Pig Purchase Agreement,
pursuant to which such member is obligated to purchase his or her proportionate
share of Alliance's feeder pig production, and each member of Alliance owning
one or more shares of Class B Common Stock or Class C Common Stock, as the case
may be, must enter into a Weaned Pig Agreement, pursuant to which such member is
obligated to purchase his or her proportionate share (based on the investor's
proportionate ownership interest in the Company's outstanding Class B Common
Stock or Class C Common Stock, as the case may be) of the Company's weaned pig
production that is to be sold to members of the Company as weaned pigs.  The
failure of the Company's stockholders to purchase their respective share of the
Company's pig production could materially adversely affect the performance of
the Company.  In the event that one or more stockholders fail to purchase their
respective share of the Company's pig production, it will be necessary for the
Company to find alternate purchasers for its unpurchased pigs.  In addition, it
also may be necessary to find alternate purchasers to the extent the Company's
production of feeder pigs exceeds two and seven-tenths (2.7) lots per share of
Class A Common Stock on a prospective rolling 12-month basis, to the extent the
Company's production of weaned pigs under the Weaned Pig Purchase Agreements
exceeds two and seven-tenths (2.7) lots per share of Class B Common Stock on a
prospective rolling 12-month basis or to the extent the Company's production of
weaned pigs under the Class C Weaned Pig Purchase Agreements exceeds two and
one-tenth (2.1) lots per share of Class C Common Stock on a prospective rolling
12-month basis.  Stockholders will not be obligated under the Feeder Pig
Purchase Agreements or Weaned Pig Agreements to purchase their proportionate
share of such excess production.  Although the Company has agreed to provide
Farmland the first opportunity to purchase feeder and weaned pigs that
stockholders have failed to purchase and any excess feeder and weaned pig
production during the five year period ending July 13, 1999, no assurances can
be given that Farmland will exercise its option to purchase any such excess
pigs.  In addition, no assurances can be given that alternate purchasers will be
available, or that any such alternate purchasers will agree to purchase feeder
or weaned pigs upon terms as favorable to the Company as those contained in the
Feeder Pig Purchase Agreements or Weaned Pig Agreements, as the case may be.  To
the extent that unpurchased feeder or weaned pigs are sold to alternate
purchasers at prices less than would have been obtained under such Agreements,
the price for feeder or weaned pigs to stockholders may increase.  See "Business
--  Feeder Pig Purchase Agreement" and "-- Weaned Pig Purchase Agreements" under
Item 1 and "Certain Relationships and Related Transactions -- Farmland" under
Item 12.

     LOSSES ASSOCIATED WITH START-UP.  Alliance was formed recently and has a
limited history of operations.  The development of feeder pig production
facilities and weaned pig production facilities entails substantial up front
expenditures for the purchase of real estate, the construction of the
facilities, and the acquisition of breeding stock and for working capital during
the initial start-up period for each new facility.  As a result, Alliance
anticipates that the development of feeder and weaned pig production facilities
will result in Alliance's continued incurrence of losses.  There can be no
assurance that Alliance will become profitable after it ceases facilities
development activities.

     SUBSTANTIAL INDEBTEDNESS.  Alliance is highly leveraged.  The degree to
which Alliance is and will be leveraged could have an adverse impact on
Alliance, including (i) increased vulnerability to adverse general economic and
market conditions, (ii) impaired ability to obtain additional financing for
future working capital, capital expenditures, general corporate or other
purposes, and (iii) dedication of a significant portion of cash provided by
operating activities to the payment of debt obligations and thereby reducing
funds available for operations or distribution.  Alliance's ability to make
required debt service payments in the future will be dependent upon Alliance's
operating results, which are subject to financial, economic and other factors
affecting Alliance, many of which are beyond its control.  Moreover, such
operating results are dependent upon the sale price paid to Alliance for feeder
pigs, which in turn is determined in part based on the twelve month historical
rolling average of operating costs incurred by Alliance in producing such pigs,
and upon the sale price paid to Alliance for weaned pigs, which in turn will be
determined in part based on the five month historical rolling average of
operating costs incurred by Alliance in producing such pigs.  Actual changes in
the sale price of feeder and weaned pigs therefore will lag changes in the
related operating costs and may affect Alliance's ability to timely make
required debt service payments.  No assurance can be given that Alliance will be
able to make required debt service payments.  No person has agreed to guarantee
the obligation of Alliance to make timely debt service payments.  See "Business
--  Feeder Pig Purchase Agreement" and "-- Weaned Pig Purchase Agreements" under
Item 1.

     ASSETS SECURING DEBT; CREDIT AGREEMENT RESTRICTIONS.  Alliance entered into
various loan agreements and other documentation with Alliance's existing lender,
CoBank.  Pursuant to such loan documentation, Alliance has been, and anticipates
that it will be, required to grant liens on substantially all of its properties
and assets to CoBank and to comply with various affirmative and negative
covenants, including but not limited to (i) maintenance of minimum levels of
working capital, (ii) restrictions on the incurrence of additional indebtedness,
(iii) restrictions on certain liens, mergers, sales of assets, investments,
guaranties, loans, advances and business activities unrelated to existing
operations, and (iv) restrictions on the declaration and payment of dividends or
patronage distributions.  There can be no assurance that Alliance will be able
to achieve and maintain compliance with the prescribed covenants of such loan
documentation.  Alliance has successfully sought and received consents, waivers
and amendments to its loan documentation on various occasions.  If further
consents, waivers or amendments are requested by Alliance, including any such
consents, waivers or amendments required for the payment of rebates on the price
of pigs sold, there can be no assurance that Alliance's lender will again grant
such requests.  The failure to obtain any such consents, waivers or amendments
would reduce Alliance's flexibility to respond to adverse industry conditions
and could have a material adverse effect on Alliance's results of operations,
financial condition and business.  If an event of default occurs under
Alliance's loan documentation, the lender will have the right to foreclose upon
such collateral.  In addition, the terms of Alliance's financing with CoBank
might adversely affect the ability of Alliance to obtain additional financing
for any future expansion efforts, including the development of feeder or weaned
pig production facilities.  No person has agreed to guarantee the obligation of
Alliance to make timely debt service payments.

     FUTURE CAPITAL NEEDS; UNCERTAINTY OF ADDITIONAL FUNDING.  Alliance is and
will be subject to the risks normally associated with debt financing, including
the risk that Alliance's cash flow will be insufficient to meet required
payments of principal and interest and the risk that indebtedness will not be
able to be refinanced or that the terms of such refinancing will not be as
favorable as the terms of the original indebtedness and thereby increasing the
cost to stockholders of feeder or weaned pigs made available under the Feeder
Pig Purchase Agreements or Weaned Pig Agreements, as the case may be.  As of
August 31, 1997, Alliance had a working capital deficit of $114,425.  Alliance
anticipates that it will be required to raise additional capital in order to
further expand its operations.  Such capital may be raised through additional
private or public financings, as well as collaborative relationships, borrowings
and other available sources.  If Alliance needs to raise additional funds, there
can be no assurance that additional or sufficient financing will be available,
or, if available, that it will be available on acceptable terms.  If additional
funds are raised by issuing equity securities of Alliance, dilution to then
existing stockholders may result.  If adequate funds are not available, Alliance
may be required to significantly curtail a portion of its planned operations.

     COMPETITION.  Many of Alliance's existing or potential competitors may have
substantially greater financial, technical and personnel resources than
Alliance.  There can be no assurance that Alliance's competitors will not be
more successful than Alliance in developing and improving pork production
technologies and raising consistent high quality feeder and weaned pigs that are
more economical to raise than any which may be developed or raised by Alliance.
Moreover, as additional competitors commence operations, the supply of feeder or
weaned pigs may exceed demand and result in a downward pressure on the
prevailing market prices for such pigs.  Under the Feeder Pig Purchase
Agreements or Weaned Pig Purchase Agreements, as the case may be, each member is
obligated to purchase his proportionate share  (based on the member's
proportionate ownership interest in Alliance's outstanding Class A Common Stock,
Class B Common Stock or Class C Common Stock, as the case may be) of Alliance's
feeder or weaned pig production based in large part on Alliance's cost of
production.  Accordingly, if Alliance is not successful in developing and
improving pork production technologies relative to its competitors or if the
prevailing market prices for feeder or weaned pigs decline below those
applicable under such Agreements, each member may be obligated to purchase his
proportionate share of Alliance's feeder or weaned pig production at a price
higher than could be available from other sources.  Alliance's ability to
achieve or maintain cost competitive feeder or weaned pig production operations
on an ongoing basis may depend on its ability to raise additional capital, which
may not then be available on acceptable terms, if at all.  See "Business --
Business Environment" "-- Competition," "-- Feeder Pig Purchase Agreement" and
"-- Weaned Pig Purchase Agreements" under Item 1.

     ANTI-CORPORATE FARMING SENTIMENT.  The development of large corporate
farming operations and concentration of hog production in larger-scale
facilities, such as those of Alliance, has increased dramatically over the last
decade.  This development has engendered opposition from residents of Colorado,
Illinois and other states in which Alliance conducts, or may conduct, its
business operations.  Such opposition may reflect various concerns, including
concerns about pollution and effluent emissions, excessive water use, offensive
odor, humane treatment of animals and the perceived threat to small farmers and
the family farm.  To the extent that public opposition is expressed with respect
to large corporate farming operations such as those of Alliance, national, state
or local laws restricting their operations may be enacted in response, legal
proceedings may be instituted to obtain monetary awards, injunctive orders or
other legal or equitable remedies, potential employees may be dissuaded from
accepting a position with such corporate farming operators, property owners may
be reluctant to sell parcels to such corporate farming operators, or other
consequences may result that could have a material adverse effect on Alliance
and its business.  No assurances can be given that public opposition will not
result in the occurrence of any one or more of such adverse consequences.  See
"Business -- Business Environment" under Item 1.

     EXPANSION.  The development and successful operation of each new facility
of Alliance depends on various factors, including the availability of suitable
sites, regulatory compliance, the ability to meet construction schedules, the
capabilities of Alliance's contractors, the ability to maintain facility
construction costs within original estimates, the ability of Alliance to manage
its anticipated expansion generally and to hire and train qualified personnel,
and general economic and business conditions.  Many of the foregoing factors are
not within the control of Alliance or its contractors, and therefore no
assurance can be given that Alliance's expansion objectives and goals will be
successfully implemented.

     CONTROL BY CURRENT STOCKHOLDERS; DISPARATE VOTING RIGHTS; POTENTIAL
CONFLICTS OF INTEREST.  As of the date of this report, Farmland, Farmers
Cooperative Elevator Company, Yuma Cooperative, Corn Plus, L.C. and Corn Plus
II, L.C. collectively own 91 shares of Alliance's Class A Common Stock and 11
shares of Alliance's Class B Common Stock, which together constitutes
approximately 50% of the combined voting power of the outstanding shares of
Alliance Common Stock.  Although no one cooperative association stockholder is
permitted to vote shares of Common Stock representing 25% or more of the shares
outstanding during any period in which Alliance has borrowed money from a lender
subject to regulations of the Farm Credit Administration regarding loan policies
and operations (such as Alliance's current lender), the above-named stockholders
could exercise a significant degree of influence or control over Alliance with
respect to the election of directors and other matters if they, or several of
them, agree to vote together on such matters.  See "Security Ownership of
Certain Beneficial Owners and Management" under Item 11.

     On all matters submitted to a vote of the Company's stockholders, holders
of Class A Common and holders of Class B Common each are entitled to one vote
per share while holders of Class C Common are entitled to three-fourths of one
vote per share.  See "Market for Common Equity and Related Stockholder Matters"
under Item 5.

     Alliance has contracted with Farmland and Yuma Cooperative for the
provision of certain requirements of Alliance, including the supply of feed and
other inputs, breeding stock, and administrative services.  Alliance's
agreements with Farmland and Yuma Cooperative may be modified in the future and
Alliance may enter into additional agreements or transactions with Farmland and
Yuma Cooperative.  Farmland, through its various business divisions,
subsidiaries and affiliates, is engaged in the production of livestock
elsewhere, in the sale of the above described supplies and services to other
parties, and in the slaughter and processing of hogs.  Farmland may have
conflicting interests in the provision of such services to Alliance in light of
its other business activities.  Similarly, Yuma Cooperative also may have
conflicting interests in the provision of goods and services to Alliance.  See
"Certain Relationships and Related Transactions" under Item 12.

     ATTRACTION AND RETENTION OF EMPLOYEES.  Alliance is dependent on members of
its management and facilities operations personnel, the loss of whose services
might adversely affect the achievement and success of its planned expansion
activities.  In addition, attracting and retaining qualified facilities
operations personnel is important to Alliance's success.  The inability to
acquire and retain the services of such management and facilities operations
personnel could have a material adverse effect on Alliance's operations and
significantly impact its prospects for success.  Although Alliance has
contracted with Farmland and others to provide certain managerial,
administrative and other services, Alliance can give no assurance that it will
be able to attract and retain the personnel it needs on acceptable terms.

     DISTRIBUTIONS AND DIVIDENDS.  No dividends will be paid by Alliance on its
Common Stock.  Although in the past Alliance has authorized the payment of cash
rebates to its members with respect to feeder pigs sold by Alliance to such
members, Alliance does not intend to authorize any future rebate payments.
Alliance, however, intends to make annual patronage distributions of its net
margins, if any, to its members on the basis of the quantity or value of
business done by Alliance with or for the member-patrons.  Such patronage
distributions may be paid in cash, written notices of allocation, whether
qualified or non-qualified, or a combination thereof, as determined by
Alliance's Board of Directors in its sole discretion.  Alliance has entered into
various loan agreements and other documentation with its existing lender which
restrict Alliance's ability to pay patronage distributions in cash.

     GOVERNMENT REGULATION.  Alliance is subject to various federal, state and
local government regulations, including those restricting certain types of
investor-owned livestock production operations and those concerning the
environment, occupational safety and health, and zoning.  While Alliance
attempts to monitor all aspects of its regulatory compliance responsibilities,
there can be no assurance that it will satisfy all applicable governmental
regulations or obtain all required approvals.  Failure to comply with applicable
regulations can, among other things, result in fines, suspensions of regulatory
approvals, operating restrictions, and criminal prosecution.  Changes in or
additions to applicable regulations also could adversely affect Alliance and its
business.

     YEAR 2000.  The Company has made an assessment of its key financial,
informational and operational systems.  Management does not anticipate that the
Company will encounter significant operational issues or difficulties related to
the Year 2000.  Furthermore, the financial impact of making systems changes is
not expected to be material to the Company's financial position, results of
operations or cash flows, although no assurances can be given in this regard..

     ADDITIONAL FACTORS.  Additional risk and uncertainties that may affect
future results of operations, financial condition or business of Alliance
include, but are not limited to: the effect of economic and industry conditions
on prices for Alliance's feeder and weaned pigs and its cost structure; the
ability to keep pace with technological change timely and cost-effectively and
to provide better service and remain competitive; adverse publicity, news
coverage by the media, or negative reports by industry analysts regarding
Alliance or its feeder and weaned pigs which may have the effect of reducing the
reputation and goodwill of Alliance; and the ability to attract and retain
capital for growth and operations on competitive terms.


ITEM 7.  FINANCIAL STATEMENTS.


     The financial statements required by this Item are located at the back of
this report on the pages indicated in Item 13.


ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND

FINANCIAL DISCLOSURE.


     None.


                                    PART III
ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;

COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.


DIRECTORS AND EXECUTIVE OFFICERS

     The names of the current directors and executive officers of the Company
(and all persons nominated or chosen to become such as of the date of this
report), their ages and present positions and offices with the Company are as
follows:

     Name                Age       Position and Offices Held


Wayne N. Snyder          53   Chairman of the Board, President and Director

Scott R. Webster         36   Vice President and Chief Operating Officer

Doug Brown               39        Treasurer, Secretary and Director

Merl Daniel              52        Director

Gerald D. Johnson        54        Director

Loren Keppy              36        Director

     Set forth below is a description of the business experience of each
director and executive officer of the Company.

     Wayne N. Snyder has served as Chairman of the Board, President and Director
of the Company since its formation in May 1994, and has served as General
Manager of Yuma LLC, the Company's predecessor, from October 1991 to July 1994.
Mr. Snyder has served as Vice President of Livestock Production for Farmland
since July 1997 and as Director of Livestock Production for Farmland from 1989
to June 1997.  In that capacity, he is responsible for all activities of
Farmland's livestock production department.  His professional career includes
over 20 years of experience with Farmland in a variety of positions, including
Regional Manager and Vice President -- Sales.

     Scott R. Webster has served as Vice President and Chief Operating Officer
of the Company since July 1995, and has served as a member of the Company's
senior management since November 1994.  Mr. Webster is Manager of Pork
Production for Farmland, where he is responsible for all of Farmland's pork
production activities.  Prior to joining Farmland in November 1994, Mr. Webster
served as Director of Nutrition, Research and Development at Brown's of Carolina
since June 1992, where he was involved in developing the company from 8,000 sows
to 50,000 sows.  He has been involved in pork production activities since 1975
and also was employed by DeKalb Feeds upon the completion of a Master of Science
degree from the University of Missouri in 1985 until June 1992.

     Doug Brown has served as Treasurer and as a Director of the Company since
its formation in May 1994, and as Secretary of the Company since October 1994.
He served as a manager of Yuma LLC from October 1991 to July 1994.  Mr. Brown
has served as the Vice President and General Manager of Yuma Cooperative since
1990.  Prior to that time, Mr. Brown served as the general manager of the
Douglas Farmers Cooperative in Douglas, Oklahoma for four years.

     Merl Daniel has served as a Director of the Company since March 1995.  Mr.
Daniel has been employed by Farmland since 1968, and has served in his present
capacity of Vice President and Controller for Farmland since July 1992.  From
October 1990 to July 1992, he served as Farmland's Director MIS, Operations and
Technical Support, in which capacity he managed Farmland's computer operations.
Prior to October 1990, Mr. Daniel served Farmland in a variety of other
capacities.

     Gerald D. Johnson has served as a Director of the Company since September
1994.  Mr. Johnson has been employed by Farmers Cooperative Elevator Company,
Plymouth, Nebraska as its General Manager since October 1992.  Prior to that
date, he served six years as Controller of Farmers Cooperative Business
Association, Shelby, Nebraska.  For the approximately 32 years prior to assuming
such position, he served in a variety of positions with several other
cooperative associations.

     Loren Keppy has served as a Director of the Company since June 1996.  Mr.
Keppy has been self-employed as a farmer since 1984.  In this regard, he
currently operates a 5,000 head per year hog finishing operation near Durant,
Iowa, in addition to farming 470 acres of crops.  Mr. Keppy received a Bachelor
of Science degree in Industrial Technology from the University of Northern Iowa,
and is a member of the River Valley Coop.

     Officers are elected annually by the Board of Directors and serve until
their respective successors are duly elected and qualified.  The Company's Board
of Directors currently consists of six directors:  Messrs. Snyder, Brown,
Daniel, Johnson and Keppy; and the sixth directorship presently is vacant and is
scheduled to be filled at the 1997 Annual Meeting of Members of Alliance to be
held in December 1997.  The members of the Board of Directors are elected for
one year terms expiring at the annual meeting of stockholders or until their
respective successors are duly elected and qualified, unless sooner removed or
disqualified.  The Company's Articles of Incorporation and Bylaws provide that
at least a majority of the directors constituting the Board of Directors shall
be, and less than a majority of the directors need not be, members or duly
authorized representatives of members of the Company.

COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

     With respect to any company having a class of equity securities registered
pursuant to Section 12 of the Securities Exchange Act of 1934 (the "Exchange
Act"), Section 16(a) of the Exchange Act requires the directors and executive
officers, persons who own more than 10% of any class of equity securities of the
Company registered pursuant to Section 12 of the Exchange Act and certain trusts
to file with the Securities and Exchange Commission initial reports of ownership
and reports of changes in ownership in such securities and other equity
securities of the Company.  During the fiscal year ended August 31, 1997, the
Company did not have any class of equity securities registered pursuant to
Section 12 of the Exchange Act.  Accordingly, no Section 16(a) filing
requirements were applicable to its directors, executive officers, greater than
10% shareholders and reportable trusts during such year with respect to the
Company's equity securities.


ITEM 10.  EXECUTIVE COMPENSATION.


EXECUTIVE COMPENSATION

     No compensation has been awarded, earned by or paid to Wayne N. Snyder, the
chief executive officer of the Company, by the Company for services rendered to
the Company as such during the period from the Company's organization on May 3,
1994 through August 31, 1997.  Mr. Snyder is employed by Farmland, which has
agreed to provide certain administrative, advisory and consulting services to
the Company under the terms of a Swine Production Services Agreement.  No
executive officer of the Company at August 31, 1997 was awarded, earned or was
paid compensation in excess of $100,000 for services rendered to the Company as
such during the fiscal year ended August 31, 1997.  See "Directors and Executive
Officers" under Item 9 and "Certain Relationships and Related Transactions"
under Item 12.

DIRECTOR COMPENSATION

     Although the Company's Bylaws provide that directors may be compensated for
their services, no compensation has been awarded to, earned by or paid to
members of the Company's Board of Directors for service to the Company as such.
Each director may be reimbursed for such director's reasonable out-of-pocket
expenses incurred in the performance of service to the Company as a director if
authorized by the Board of Directors.


ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.


     The following table sets forth certain information as of August 31, 1997
regarding the beneficial ownership of Class A Common Stock in Alliance by
Farmland, Farmers Cooperative Elevator Company, Yuma Cooperative, Corn Plus,
L.C. and Corn Plus II, L.C.; the only persons who were the beneficial owners of
more than 5% of the outstanding Class A Common Stock as of such date.   No
directors or executive officers of the Company were the beneficial owners of
Alliance Class A Common Stock as of that date.  As of that date, no shares of
Class B Common Stock or Class C Common Stock were outstanding.  All information
with respect to beneficial ownership has been furnished by the respective 5% or
more stockholder.


    NAME AND ADDRESS OF      AMOUNT AND NATURE OF      PERCENT OF CLASS A
     BENEFICIAL OWNER        BENEFICIAL OWNER(1)       COMMON OUTSTANDING


Farmland Industries, Inc. (2)         52                    43.7%
     3315 North Oak Trafficwa
     Kansas City, MO 64116

Farmers Cooperative Elevator          11                     9.2%
     Company (3)
     501 East Main Street
     Plymouth, NE  68424

Yuma Farmers Milling and              12                    10.1%

Mercantile
     Cooperative Company (4)
     101 South Detroit
     Yuma, CO  80759

Corn Plus, L.C. (5)                                          5.0%
     212 North Agora Street           6
     Marathon, Iowa  50565

Corn Plus II, L.C. (6)                10                     8.4%
     212 North Agora Street
     Marathon, Iowa  50565

_________________
(1)  Beneficial ownership is determined in accordance with the rules of the
     Securities and Exchange Commission which generally attribute beneficial
     ownership of securities to persons who possess sole or shared voting power
     and/or investment power with respect to those securities.  Unless otherwise
     indicated, the persons or entities identified in this table have sole
     voting and investment power with respect to all shares shown as
     beneficially owned by them.  Percentage ownership calculations are based on
     119 shares of Class A Common Stock outstanding.

(2)  The voting and disposition of the shares of Class A Common Stock held by
     Farmland are subject to the discretion of the board of Directors of
     Farmland.  Pursuant to the Company's Articles of Incorporation, Farmland is
     prohibited from voting shares of Class A Common Stock representing 25% or
     more of the shares outstanding during any period in which the Company has
     borrowed money from a lender subject to regulations of the Farm Credit
     Administration regarding loan policies and operations (such as the
     Company's current lender).  As of August 31, 1997, the Company had borrowed
     funds from such a lender.  See "Description of Business -- Financing" under
     Item 1 and "Holders" under Item 5.
(3)  The voting and disposition of the shares of Class A Common Stock held by
     Yuma Cooperative are subject to the discretion of the Board of Directors of
     Yuma Cooperative.

(4)  The voting and disposition of the shares of Class A Common Stock held by
     Farmers Cooperative Elevator Company are subject to the discretion of the
     Board of Directors of Farmers Cooperative Elevator Company.

(5)  The voting and disposition of the shares of Class A Common Stock held by
     Corn Plus, L.C. are subject to the discretion of the manager of Corn Plus,
     L.C..

(6)  The voting and disposition of the shares of Class A Common Stock held by
     Corn Plus II, L.C. are subject to the discretion of the manager of Corn
     Plus II, L.C..


ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.


GENERAL

     As of August 31, 1997, Farmland and Yuma Cooperative owned approximately
43.7% and 10.1%, respectively, of the Class A Common Stock of the Company.  In
connection with the formation of the Company as a Colorado cooperative
association on May 3, 1994, one share of the Company's Class A Common Stock was
issued to Farmland for the purchase price of $100.  On July 13, 1994, the
Company acquired the entire equity ownership rights and interests in Yuma LLC, a
Colorado limited liability corporation in which Farmland and Yuma Cooperative
owned approximately 71.5% and 28.5%, respectively, of the outstanding equity
interests.  In exchange for their respective equity interests in Yuma LLC,
Farmland and Yuma Cooperative were issued 30 shares and 12 shares, respectively,
of the Company's Class A Common Stock.  Yuma LLC thereupon was dissolved and
liquidated and its assets and liabilities were assigned to and assumed by
Alliance.  As of the date of this report, the Company has consummated its
issuance and sale to Farmland of an additional 19 shares of Class A Common Stock
and 11 shares of Class B Common Stock in exchange for the purchase price of
$2,180,000.  The Company has entered into various contractual arrangements with
both Farmland and Yuma Cooperative for the provision of specific goods and
services.  All future transactions between the Company and its officers,
directors, employees and affiliates, including Farmland and Yuma Cooperative,
will be on terms no less favorable to the Company than can be obtained from
unaffiliated parties.  All such transactions will be subject to the approval of
a majority of the independent outside members of the Board of Directors who do
not have an interest in the transactions.  See Item 11.

FARMLAND

     Farmland is a Kansas cooperative association engaged in regional farm
supply and marketing operations, including the processing and marketing of pork
and beef.  Farmland's livestock production department is directly engaged in the
production of feeder pigs and finished hogs through contractual arrangements
with independent producers, the ownership of pig production operations in joint
venture with both agricultural cooperatives and independent producers, as well
as other activities including the operation of feeder pig brokerage services.
Wayne N. Snyder, Scott R. Webster and Merl Daniel each are employed by Farmland
and presently serve as directors or executive officers of the Company.

     Farmland, through its various business divisions and interests, is engaged
in providing to competitors of the Company certain goods and services, including
the supply of feed and other inputs, breeding stock and administrative services,
among others, which are comparable to those being provided by Farmland to the
Company.  Moreover, Farmland also is directly engaged in the production of hogs
through the direct ownership of animals and facilities, through contractual
arrangements with other producers, and through joint venture arrangements
established with other parties.  Because of Farmland's various activities, there
may arise conflicts of interest between Farmland and the Company.  The Company
anticipates that Farmland may continue to engage and invest in activities and
businesses other than those of Alliance.  Thus, Farmland may have conflicts of
interest in allocating its resources and management time, services and functions
among the Company and such other activities.  Similarly, with respect to the
employees of Farmland serving as officers or directors of the Company,
Farmland's other business interests may result in competition for their time,
services and functions.

     Swine Production Consulting and Services Agreement.  The Company has
entered into various contractual arrangements with Farmland for the provision of
specific goods and services.  Under the terms of a Swine Production Services
Agreement with the Company, Farmland, acting as independent contractor, has
agreed to provide certain administrative, advisory and consulting services to
the Company, including the following:  performing various ministerial services,
including data entry of transactions for accounting purposes and computer
generation of financial and operational reports and checks; compilation of the
production records with respect to each feeder and weaned pig production
facility; logistical backup and coordination, including facilitating the
acquisition, servicing, transportation and sale of genetic stock, breeding
stock, feeder pigs and weaned pigs; facilitating the purchase of inputs for the
Company; assistance in sourcing feed ingredients, animal health products and
veterinarian services; assistance in arranging financing; assistance in
selection of suitable sites for the Company's facilities; assistance in
obtaining appropriate permits for the construction and operation of facilities
for the Company; assistance in the recruitment, selection and training of
general managers for the Company; and advice and consultation with respect to
management practices, feed formulations and other aspects of the Company.

     Farmland has agreed to assist the Company in acquiring the necessary
management and labor to adequately staff and operate the Company's pig
production facilities. The Company will cause the new pig production facilities
to be constructed, provide initial and replacement breeding stock purchased from
Farmland or other sources which, under normal circumstances, will be sufficient
to keep the facilities in full production and provide adequate record keeping to
allow Farmland to provide the accounting and reporting functions required of it
under the Swine Production Services Agreement.  Finally, the Company will grant
Farmland reasonable access to the facilities, in accordance with good bio-
security practices, to allow Farmland to provide its required services.
Farmland will be paid one dollar ($1.00) for each feeder or weaned pig sold by
the Company as partial compensation for Farmland's duties under the agreement.
Such amount is subject to adjustment annually commensurate with, and based upon,
changes in the Consumer Price Index.  For the years ended August 31, 1997 and
1996, the Company paid Farmland a total of $250,967 and $151,905, respectively,
for its provision of administrative, advisory and consulting services pursuant
to the Swine Production Services Agreement.  Farmland also may provide a
significant portion of the feed ingredients, nutritional supplements and animal
health supplies required by the Company at Farmland's customary rates.  For the
years ended August 31, 1997 and 1996, the Company purchased $638,730 and
$303,963, respectively, of feed ingredients, nutritional supplements and animal
health supplies from Farmland.

     Farmland will purchase from the Company gilts produced by the Company for
purposes of finishing for use as breeding stock by the Company, subject to
available finishing capacity of Farmland.  Upon completion of such finishing,
Farmland will resell to the Company all such gilts that survive finishing by
Farmland.  The purchase price to be paid by Farmland to the Company for gilts
will be based on the purchase price specified in the Feeder Pig Purchase
Agreement between Farmland and the Company or, if no such agreement is then in
effect, the purchase price specified in the most recent effective Feeder Pig
Purchase Agreement between Farmland and the Company.  The purchase price to be
paid by the Company to Farmland for finished gilts will be based upon the
prevailing market price of hogs at the time of purchase, plus any royalty fees
payable by Farmland and a handling fee of $10.00 per gilt.  For the years ended
August 31, 1997 and 1996, the Company purchased finished gilts from Farmland at
an aggregate price of $2,367,524 and $872,979, respectively.

     It is anticipated that Farmland may provide hybrid gilts from additional
multiplier facilities to meet a portion of the Company's initial stocking and
ongoing requirements for breeding stock with respect to each  pig production
facility in existence, under development or proposed.  The actual number of
replacement gilts purchased from Farmland will be affected by the Company's
requirements and the availability of animals from Farmland's facilities.  The
purchase price of replacement hybrid breeding stock is to be based upon the
prevailing market price of breeding stock at the time of purchase.

     In the Swine Production Services Agreement, the Company has granted
Farmland an option during the term of the Agreement (and in no event less than
the five-year period ending July 13, 1999) to purchase (a) excess feeder pigs
produced by the Company and excess weaned pigs produced by the Company at the
price per pig equal to the average price per pig paid by stockholders under
Feeder Pig Purchase Agreements or Weaned Pig Purchase Agreements, as the case
may be, for the then immediately preceding month, and (b) feeder pigs and weaned
pigs that a stockholder has failed to purchase under such stockholder's Feeder
Pig Purchase Agreement or Weaned Pig Purchase Agreement, as the case may be, at
the price per pig determined pursuant to such Agreement.  The Company also has
granted Farmland an option to purchase any shares of Common Stock reacquired by
the Company.

     Feeder Pig Purchase Agreement.  As a member of the Company, Farmland has
contracted with the Company to purchase a share of the feeder pigs to be
produced by the Company under the same terms required of the Company's other
members.  Commencing on August 11, 1995, the date the Company first produced and
shipped feeder pigs pursuant to the Feeder Pig Purchase Agreements with the
Company's existing members (other than Farmland and Yuma Cooperative), the price
paid by Farmland for feeder pigs has been under terms comparable to those
applicable to the Company's members pursuant to the Feeder Pig Purchase
Agreements.  For the years ended August 31, 1997 and 1996, Farmland purchased
feeder pigs from the Company (including Yuma Cooperative's share of feeder pigs
produced by the Company) at an aggregate price of $7,924,763 and $5,035,160,
respectively.  Finally, the Company has agreed to provide Farmland the first
opportunity to purchase any feeder pigs produced by the Company in excess of the
Company's supply commitments to other members or that other members have failed
to purchase during the term of the Swine Production Services Agreement (and in
no event less than the five-year period ending July 13, 1999).  See "Description
of Business -- Feeder Pig Purchase Agreement" under Item 1.

     Real Estate Loans.  Between September and December 1995, the Company
purchased approximately 1,000 acres of real property in Yuma County, Colorado,
upon which the Company has developed one production facility and holds the
remaining acreage for the development of additional production facilities (the
"Additional Colorado Property").  The acquisition cost of this Additional
Colorado Property was approximately $760,000.  The Company obtained funding for
the purchase of the Additional Colorado Property from the proceeds of a loan
obtained from Farmland.  In conjunction with this loan, the Company delivered to
Farmland a promissory note evidencing the debt providing for the amortization of
the loan over a ten-year period, at a variable rate equal to CoBank's prime
rate.  As of August 31, 1997, CoBank's prime rate was 8.50%.  The payment
schedule of the promissory note requires that the Company make interest-only
payments for the life of the loan, with a final balloon payment of the principal
at the expiration of the ten-year term.  To secure the obligations of the
promissory note, the Company has agreed to execute a deed of trust in favor of
Farmland covering all of the Additional Colorado Property, which deed of trust
is second in priority to that of CoBank with respect to the production facility
constructed thereon.  See "Description of Property" under Item 2.

     In November 1996, the Company exercised its rights under an option contract
to acquire an approximately 90 acre tract of real property in Wayne County,
Illinois, including 45 acres  (the "45 Acre Tract") on which the Company has
commenced development activities with respect to a second Illinois sow
production facility.  The Company obtained  funding for the purchase of the 45
Acre Tract, and subsequent development of a feeder pig facility, from the
proceeds of a $1,360,000 loan provided by Farmland.  In conjunction with this
loan, the Company delivered to Farmland a promissory note evidencing the debt
providing for amortization over a ten-year period, at a variable rate equal to
CoBank's then national variable rate plus 1.25%.  This loan was repaid by
Alliance in full in August 1997, and the promissory note has been cancelled.

     In November 1997, the Company obtained a second loan of $1,360,000 from
Farmland for the  development of a sixth feeder pig facility in Yuma County,
Colorado.  In conjunction with this loan, the Company delivered to Farmland a
promissory note evidencing the debt providing for amortization over a ten-year
period, at a variable rate equal to CoBank's then national variable rate plus
1.25% The payment schedule for the Farmland loan would require the Company to
make interest-only payments for the life of the loan, with a final balloon
payment of all principal to be made upon the earlier of (i) the Company's next
issuance and sale of a minimum block of 17 shares of Common Stock, and (ii) the
expiration of ten years.  Alliance's obligation to Farmland under this note is
secured by a mortgage on the real property upon which the sixth Colorado
facility is being developed.  See "Description of Property" under Item 2.

     Pig Producers I, L.P.  Farmland holds a 12.5% interest in Pig Producers I,
L.P. ("Pig Producers"), a limited partnership engaged in the production of
feeder pigs from a 2,450-sow feeder pig production facility located in Yuma
County, Colorado.  The Company has assigned 13 employees of its employees to
perform various facilities operation services for Pig Producers.  Pig Producers
reimburses the Company for all wages, benefits and other costs attributable to
these Alliance employees.  From time to time, the Company and Pig Producers also
engage in various commercial transactions related to the sale of genetic stock,
breeding stock, feed ingredients and animal health supplies.

     Colorado Repopulation.  In connection with the repopulation of the
Company's feeder pig production facilities located in Yuma County, Colorado, the
Company intends to arrange for the finishing of new breeding sows on facilities
of independent producers.  In this regard, Alliance has contracted with Farmland
for the use of facilities as to which Farmland has acquired rights from the
owners of such facilities.  During the approximately 14 months that Alliance
intends to use such facilities, Alliance will have approximately 9,240 pig
spaces available to it.  Alliance will be obligated to pay the facilities owner
a monthly fee equal to $31.50 per pig space divided by twelve  In addition,
Farmland will be entitled to a monthly fee from Alliance equal to $1.00 per pig
space divided by 12.

YUMA COOPERATIVE

     Yuma Cooperative is a Colorado cooperative association engaged in farm
supply and grain marketing activities.  Doug Brown is Vice President and General
Manager of Yuma Cooperative and serves as a director and executive officer of
the Company.

     Yuma Cooperative is engaged in providing to competitors of the Company and
other users certain goods and services, including the supply of feed and animal
health products, which are comparable to those provided by Yuma Cooperative to
the Company.  Because of its other business activities, conflicts of interest
may arise between Yuma Cooperative and the Company.  With respect to the
employees of Yuma Cooperative serving as officers or directors of the Company,
Yuma Cooperative's other business interests may result in competition for their
time, services and functions.

     Feed Purchase Agreement.  The Company has entered into a Feed Purchase
Agreement with Yuma Cooperative respecting the supply of manufactured feed and
animal health products.  In this capacity, Yuma Cooperative has agreed to
purchase feed-grains and feed additives for the production of feed which,
together with animal health products, will be sold to the Company.  In exchange
for providing these goods and services, Yuma Cooperative is entitled to
compensation based upon a fixed charge for the grinding, mixing, and delivery of
feed ($14.51 per ton as of November 1, 1997), in addition to the actual
delivered cost of the feed ingredients.   Feed rations which are pelleted are
subject to a surcharge ($7.24 per ton as of November 1, 1997).  Both the fixed
charge and the surcharge are subject to annual increases in November of each
year corresponding to any increases in the Consumer Price Index -- Retail Items.
Corn provided by Yuma Cooperative for use in feed generally is sold to the
Company at delivered cost plus, in the absence of available Company grain
storage facilities, a $.10 per bushel handling fee.  The Company has the right
under the Feed Purchase Agreement, in its sole discretion, to purchase and
provide its own corn for feed manufacturing.  For the years ended August 31,
1997 and 1996, the Company purchased $4,338,732 and $3,423,773, respectively, of
feed from Yuma Cooperative.  See "Description of Business -- Purchase of Feed
and Other Inputs" under Item 1.

     Feeder Pig Purchase Agreement.  As a member of the Company, Yuma
Cooperative has contracted with the Company to purchase a share of the feeder
pigs to be produced by the Company under the same terms required of the
Company's other members.  Commencing on August 11, 1995, the date the Company
first produced and shipped feeder pigs pursuant to the Feeder Pig Purchase
Agreements with the Company's existing members (other than Farmland and Yuma
Cooperative), the price paid by Yuma Cooperative for feeder pigs has been under
terms comparable to those applicable to the Company's members pursuant to the
Feeder Pig Purchase Agreements.  For the years ended August 31, 1997 and 1996,
Yuma Cooperative's share of feeder pigs produced by the Company was purchased
from the Company by Farmland.  See "Certain Relationships and Related
Transactions -- Farmland" and "Description of Business -- Feeder Pig Purchase
Agreement" under Item 1.


ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K.


     (A)  EXHIBITS:

     1.   The following financial statements of the Company and reports of the
Company's independent auditors appear on the pages indicated in this report.

                                                                     Page


Independent Auditors' Report                                            45

Balance Sheets as of August 31, 1997 and 1996                           46

Statements of Operations for the years ended August 31, 1997 and
1996                                                                    48

Statements of Shareholders' Equity for the years ended August 31,
1997 and 1996                                                           49

Statements of Cash Flows for the years ended August 31, 1997 and
1996                                                                    50

Notes to Financial Statements                                           52


      2.    The following exhibits are filed as part of this report:


Exhibit
   No.                                          Description


3.1     Articles of Incorporation (filed on May 23, 1997 as Exhibit 3.1 to the
        Company's Registration on Form SB-2 (Registration No. 333-25501) and
        incorporated herein by reference).

3.1.1   Articles of Amendment (filed on May 23, 1997 as Exhibit 3.1.1 to the
        Company's Registration on Form SB-2 (Registration No. 333-25501) and
        incorporated herein by reference).

3.1.2   Articles of Amendment (filed on May 23, 1997 as Exhibit 3.1.2 to the
        Company's Registration Statement on Form SB-2 (Registration No. 333-
        25501) and incorporated herein by reference).

3.1.3   Articles of Amendment (filed on May 23,, 1997 as Exhibit 3.1.3 to the
        Company's Registration Statement on Form SB-2 (Registration No. 333-
        25501) and incorporated herein by reference).

3.1.4   Articles of Amendment (filed on May 23, 1997 as Exhibit 3.1.4 to the
        Company's Registration Statement on Form SB-2 (Registration No. 333-
        25501) and incorporated herein by reference).

3.2     Amended and Restated Bylaws (filed on May 23, 1997 as Exhibit 3.2 to
        the Company's Registration on Form SB-2 (Registration No. 333-25501)
        and incorporated herein by reference).

3.2.1   Amendments to Amended and Restated Bylaws (filed on May 23, 1997 as
        Exhibit 3.2.1 to the Company's Registration on Form SB-2 (Registration
        No. 333-25501) and incorporated herein by reference).

4.1     Articles of Incorporation (filed on May 23, 1997 as Exhibit 3.1 to the
        Company's Registration on Form SB-2 (Registration No. 333-25501) and
        incorporated herein by reference).

4.1.1   Articles of Amendment (filed on May 23, 1997 as Exhibit 3.1.1 to the
        Company's Registration on Form SB-2 (Registration No. 333-25501) and
        incorporated herein by reference).
4.1.2   Articles of Amendment (filed on May 23, 1997 as Exhibit 3.1.2 to the
        Company's Registration Statement on Form SB-2 (Registration No. 333-
        25501) and incorporated herein by reference).

4.1.3   Articles of Amendment (filed on May 23, 1997 as Exhibit 3.1.3 to the
        Company's Registration Statement on Form SB-2 (Registration No. 333-
        25501) and incorporated herein by reference).

4.1.4   Articles of Amendment (filed on May 23, 1997 as Exhibit 3.1.4 to the
        Company's Registration Statement on Form SB-2 (Registration No. 333-
        25501) and incorporated herein by reference).

4.2     Amended and Restated Bylaws (filed on May 23, 1997 as Exhibit 3.2 to
        the Company's Registration on Form SB-2 (Registration No. 333-25501)
        and incorporated herein by reference).

4.2.1   Amendments to Amended and Restated Bylaws (filed on May 23, 1997 as
        Exhibit 3.2.1 to the Company's Registration on Form SB-2 (Registration
        No. 333-25501) and incorporated herein by reference).

4.3.1   Specimen Form of Certificate Representing Membership in the Company and
        the Class A Common Stock (filed on November 7, 1994 as Exhibit 4.3 to
        the Company's Registration on Form SB-2 (Registration No. 33-86068) and
        incorporated herein by reference).

4.3.2   Specimen Form of Certificate Representing Membership in the Company and
        the Class B Common Stock (filed on April 18, 1997 as Exhibit 4.4 to the
        Company's Registration Statement on Form SB-2 (Registration No. 333-
        25501) and incorporated herein by reference).

4.3.3   Specimen Form of Certificate Representing Membership in the Company and
        the Class C Common Stock (filed on May 23, 1997 as Exhibit 4.15 to the
        Company's Registration Statement on Form SB-2 (Registration No. 333-
        25501) and incorporated herein by reference).

4.4     Loan Agreement, dated as of September 21, 1994, between National Bank
        for Cooperatives and the Registrant (filed on November 7, 1994 as
        Exhibit 10.6 to the Company's Registration on Form SB-2 (Registration
        No. 33-86068) and incorporated herein by reference).

4.4.1   Term Loan Amendment, dated as of May 19, 1995, between CoBank, ACB
        (formerly National Bank for Cooperatives) and the Registrant (filed
        with the Company's Annual Report on Form 10-KSB for the fiscal year
        ended August 31, 1995 as Exhibit 10.6.1 and incorporated herein by
        reference).

4.5     The Registrant's Promissory Note, dated September 21, 1994, to National
        Bank for Cooperatives (filed on November 7, 1994 as Exhibit 10.7 to the
        Company's Registration on Form SB-2 (Registration No. 33-86068) and
        incorporated herein by reference).

4.6     Security Agreement, dated September 21, 1994, made by the Registrant to
        National Bank for Cooperatives (filed on November 7, 1994 as Exhibit
        10.8 to the Company's Registration on Form SB-2 (Registration No. 33-
        86068) and incorporated herein by reference).

4.7     Correction Deed of Trust, dated November 4, 1994, between the Public
        Trustee of the County of Yuma, State of Colorado and the Registrant
        (filed on January 23, 1995 as Exhibit 10.9 to the Company's
        Registration on Form SB-2 (Registration No. 33-86068) and incorporated
        herein by reference).

4.8     Master Loan Agreement, dated as of May 19, 1995, between CoBank, ACB
        and the Registrant (filed with the Company's Annual Report on Form 10-
        KSB for the fiscal year ended August 31, 1995 as Exhibit 10.11 and
        incorporated herein by reference).

4.9     Multiple Advance Term Loan Supplement, dated as of May 19, 1995,
        between CoBank, ACB and the Registrant (filed with the Company's Annual
        Report on Form 10-KSB for the fiscal year ended August 31, 1995 as
        Exhibit 10.12 and incorporated herein by reference).

4.9.1   Amendment to Multiple Advance Term Loan Supplement, dated as of
        February 11, 1997, between CoBank, ACB and the Registrant respecting
        the extension of the CoBank credit facility (filed on April 18, 1997
        as Exhibit 10.14.1 to the Registrant's Registration Statement on Form
        SB-2 (No. 333-25501) and incorporated herein by reference).

4.10    Revolving Term Loan Supplement, dated as of May 19, 1995, between
        CoBank, ACB and the Registrant (filed with the Company's Annual Report
        on Form 10-KSB for the fiscal year ended August 31, 1995 as Exhibit
        10.13 and incorporated herein by reference).

4.11    Correction Deed of Trust, dated October 23, 1996, between the Public
        Trustee of the County of Yuma, State of Colorado and the Registrant
        (filed with the Registrant's Quarterly Report on Form 10-QSB for the
        quarter ended February 28, 1997 as Exhibit 10.6 and incorporated
        herein by reference).

4.12    Illinois Mortgage, dated February 23, 1996, from the Registrant to
        CoBank, ACB (filed with the Registrant's Quarterly Report on Form 10-
        QSB for the quarter ended February 28, 1997 as Exhibit 10.10 and
        incorporated herein by reference).

4.13    Letter Agreement between the Registrant to CoBank, ACB respecting the
        extension of the CoBank credit facility (filed on April 18, 1997 as
        Exhibit 10.28 to the Registrant's Registration Statement on Form SB-2
        (No. 333-25501) and incorporated herein by reference).

10.1    Form of Feeder Pig Purchase Agreement (filed on January 23, 1995 as
        Exhibit 10.1 to the Company's Registration on Form SB-2 (Registration
        No. 33-86068) and incorporated herein by reference).

10.2    Swine Production Services Agreement, dated July 13, 1994, between
        Farmland Industries, Inc. and the Registrant (filed on November 7, 1994
        as Exhibit 10.2 to the Company's Registration on Form SB-2
        (Registration No. 33-86068) and incorporated herein by reference).

10.2.1  First Amendment to Swine Production Services Agreement, dated as of
        July 26, 1996, between Farmland Industries, Inc. and the Company (filed
        with the Registrant's Quarterly Report on Form 10-QSB for the quarter
        ended February 28, 1997 as Exhibit 10.1 and incorporated herein by
        reference).

10.2.2  Second Amendment to Swine Production Services Agreement, dated as of
        April 14, 1997, between Farmland Industries, Inc. and the Registrant
        (filed on April 18, 1997 as Exhibit 10.2.2 to the Registrant's
        Registration Statement on Form SB-2 (No. 333-25501) and incorporated
        herein by reference).

10.3    Feed Purchase Agreement, dated July 13, 1994, between the Yuma Farmers
        Milling-Mercantile Cooperative Company of Yuma, Colorado and the
        Registrant (filed on November 7, 1994 as Exhibit 10.3 to the Company's
        Registration on Form SB-2 (Registration No. 33-86068) and incorporated
        herein by reference).

10.4    Interim Feeder Pig Purchase Agreement, dated July 13, 1994, between
        Farmland Industries, Inc. and the Registrant (filed on November 7, 1994
        as Exhibit 10.4 to the Company's Registration on Form SB-2
        (Registration No. 33-86068) and incorporated herein by reference).

10.4.1  First Amendment to Interim Feeder Pig Purchase Agreement, dated July
        13, 1994, between Farmland Industries, Inc. and the Registrant (filed
        on November 7, 1994 as Exhibit 10.4.1 to the Company's Registration on
        Form SB-2 (Registration No. 33-86068) and incorporated herein by
        reference).

10.5    Interim Feeder Pig Purchase Agreement, dated July 13, 1994, between the
        Yuma Farmers Milling-Mercantile Cooperative Company of Yuma, Colorado
        and the Registrant (filed on November 7, 1994 as Exhibit 10.5 to the
        Company's Registration on Form SB-2 (Registration No. 33-86068) and
        incorporated herein by reference).

10.5.1  First Amendment to Interim Feeder Pig Purchase Agreement, dated July
        13, 1994, between the Yuma Farmers Milling-Mercantile Cooperative
        Company of Yuma, Colorado and the Registrant (filed on November 7, 1994
        as Exhibit 10.5.1 to the Company's Registration on Form SB-2
        (Registration No. 33-86068) and incorporated herein by reference).

10.6    Loan Agreement, dated as of September 21, 1994, between National Bank
        for Cooperatives and the Registrant (filed on November 7, 1994 as
        Exhibit 10.6 to the Company's Registration on Form SB-2 (Registration
        No. 33-86068) and incorporated herein by reference).

10.6.1  Term Loan Amendment, dated as of May 19, 1995, between CoBank, ACB
        (formerly National Bank for Cooperatives) and the Registrant (filed
        with the Registrant's Annual Report on Form 10-KSB for the fiscal year
        ended August 31, 1995 as Exhibit 10.6.1 and incorporated herein by
        reference).

10.7    The Registrant's Promissory Note, dated September 21, 1994, to National
        Bank for Cooperatives (filed on November 7, 1994 as Exhibit 10.7 to the
        Company's Registration on Form SB-2 (Registration No. 33-86068) and
        incorporated herein by reference).

10.8    Security Agreement, dated September 21, 1994, made by the Registrant to
        National Bank for Cooperatives (filed on November 7, 1994 as Exhibit
        10.8 to the Company's Registration on Form SB-2 (Registration No. 33-
        86068) and incorporated herein by reference).

10.9    Correction Deed of Trust, dated November 4, 1994, between the Public
        Trustee of the County of Yuma, State of Colorado and the Registrant
        (filed on January 23, 1995 as Exhibit 10.9 to the Company's
        Registration on Form SB-2 (Registration No. 33-86068) and incorporated
        herein by reference).

10.10   Effluent Agreement, dated September 15, 1994, between RMR Ranch, Inc.,
        and the Registrant (filed on November 7, 1994 as Exhibit 10.13 to the
        Company's Registration on Form SB-2 (Registration No. 33-86068) and
        incorporated herein by reference).

10.11   Master Loan Agreement, dated as of May 19, 1995, between CoBank, ACB
        and the Registrant (filed with the Registrant's Annual Report on Form
        10-KSB for the fiscal year ended August 31, 1995 as Exhibit 10.11 and
        incorporated herein by reference).

10.12   Multiple Advance Term Loan Supplement, dated as of May 19, 1995,
        between CoBank, ACB and the Registrant  (filed with the Registrant's
        Annual Report on Form 10-KSB for the fiscal year ended August 31, 1995
        as Exhibit 10.12 and incorporated herein by reference).

10.12.1 Amendment to Multiple Advance Term Loan Supplement, dated as of
        February 11, 1997, between CoBank, ACB and the Registrant respecting
        the extension of the CoBank credit facility (filed on April 18, 1997 as
        Exhibit 10.14.1 to the Registrant's Registration Statement on Form SB-2
        (No. 333-25501) and incorporated herein by reference).

10.13   Revolving Term Loan Supplement, dated as of May 19, 1995, between
        CoBank, ACB and the Registrant (filed with the Registrant's Annual
        Report on Form 10-KSB for the fiscal year ended August 31, 1995 as
        Exhibit 10.13 and incorporated herein by reference).

10.14   Master Construction Agreement, dated September 18, 1995, between the
        Registrant and Central Confinement Service, Ltd. (filed with the
        Registrant's Annual Report on Form 10-KSB for the fiscal year ended
        August 31, 1995 as Exhibit 10.15 and incorporated herein by reference).

10.15   Form of Weaned Pig Purchase Agreement (filed on April 18, 1997 as
        Exhibit 10.29 to the Company's Registration Statement on Form SB-2
        (Registration No. 333-25501) and incorporated herein by reference).

10.16   Form of Class C Weaned Pig Purchase Agreement (filed on May 23, 1997 as
        Exhibit 10.34 to the Company's Registration Statement on Form SB-2
        (Registration No. 333-25501) and incorporated herein by reference).

10.17   The Registrant's Promissory Note, dated August 30, 1995, to Farmland
        Industries, Inc. (filed with the Registrant's Annual Report on Form 10-
        KSB for the fiscal year ended August 31, 1995 as Exhibit 10.16 and
        incorporated herein by reference).

10.18   Loan Agreement, dated as of November 5, 1997, between the Registrant
        and Farmland Industries, Inc.

10.19   The Registrant's Promissory Note, dated November 5, 1997, to Farmland
        Industries, Inc.

10.20   Security Agreement, dated as of November 5, 1997, between the
        Registrant and Farmland Industries, Inc.

10.21   Colorado Deed of Trust, dated November 5, 1997, between the Registrant,
        the Public Trustee of the County of Yuma, State of Colorado and
        Farmland Industries, Inc.

10.22   Excess Feeder Pig Purchase Agreement, dated as of November 5, 1997,
        between the Registrant and Farmland Industries, Inc.

10.23   Camborough-22 Closed Herd Multiplier Agreement, dated March 1, 1996,
        between Pig Improvement Company, Inc. and the Registrant (filed with
        the Registrant's Quarterly Report on Form 10-QSB for the quarter ended
        February 28, 1997 as Exhibit 10.2 and incorporated herein by reference)

10.24   Option Contract, dated November 20, 1996, between Bill L. Bailey and
        Norma Jean Bailey, and the Registrant (filed with the Registrant's
        Quarterly Report on Form 10-QSB for the quarter ended February 28, 1997
        as Exhibit 10.3 and incorporated herein by reference)

10.25   Correction Deed of Trust, dated October 23, 1996, between the Public
        Trustee of the County of Yuma, State of Colorado and the Registrant
        (filed with the Registrant's Quarterly Report on Form 10-QSB for the
        quarter ended February 28, 1997 as Exhibit 10.6 and incorporated herein
        by reference)

10.26   Master Construction Agreement, dated November 22, 1996 (Illinois #2 sow
        unit), between the Registrant and Central Confinement Service, Ltd.
        (filed with the Registrant's Quarterly Report on Form 10-QSB for the
        quarter ended February 28, 1997 as Exhibit 10.7 and incorporated herein
        by reference)

10.27   Master Construction Agreement, dated November 22, 1996 (Illinois #2
        nursery), between the Registrant and Central Confinement Service, Ltd.
        (filed with the Registrant's Quarterly Report on Form 10-QSB for the
        quarter ended February 28, 1997 as Exhibit 10.8 and incorporated herein
        by reference)

10.28   Master Construction Agreement, dated November 22, 1996 (Illinois #2
        isolation building), between the Registrant and Central Confinement
        Service, Ltd. (filed with the Registrant's Quarterly Report on Form 10-
        QSB for the quarter ended February 28, 1997 as Exhibit 10.9 and
        incorporated herein by reference)

10.29   Illinois Mortgage, dated February 23, 1996, from the Registrant to
        CoBank, ACB (filed with the Registrant's Quarterly Report on Form 10-
        QSB for the quarter ended February 28, 1997 as Exhibit 10.10 and
        incorporated herein by reference)

10.30   Letter Agreement between the Registrant to CoBank, ACB respecting the
        extension of the CoBank credit facility (filed on April 18, 1997 as
        Exhibit 10.28 to the Registrant's Registration Statement on Form SB-2
        (No. 333-25501) and incorporated herein by reference).

10.31   Colorado Breeding Farm Side Agreement, dated April 11, 1997, between
        the Registrant and Farmland Industries, Inc. (filed on May 23, 1997 as
        Exhibit 10.35 to the Registrant's Registration Statement on Form SB-2
        (No. 333-25501) and incorporated herein by reference).

10.32   Colorado Breeding Farm Agreement, dated April 11, 1997, between the
        Registrant, G & G Pork Producers, LLC and Farmland Industries, Inc.
        (filed on May 23, 1997 as Exhibit 10.36 to the Registrant's
        Registration Statement on Form SB-2 (No. 333-25501) and incorporated
        herein by reference).

10.33   Colorado Breeding Farm Agreement, dated April 21, 1997, between the
        Registrant, Triple R and Farmland Industries, Inc. (filed on May 23,
        1997 as Exhibit 10.37 to the Registrant's Registration Statement on
        Form SB-2 (No. 333-25501) and incorporated herein by reference).

10.34   CoBank, ACB Loan Commitment Letter, dated October 9, 1997.

24.1    Power of Attorney

27      Financial Data Schedule
_____________________________

No management contracts or compensatory plans or arrangements required to be
identified by Item 13(a) are included among the exhibits filed as part of this
report.

      (B)   REPORTS ON FORM 8-K.

      No reports on Form 8-K have been filed during the last quarter of the
period covered by this report.

                          Independent Auditor's Report



The Board of Directors
Alliance Farms Cooperative Association:

We have audited the accompanying balance sheets of Alliance Farms Cooperative
Association as of August 31, 1997 and 1996 and the related statements of
operations, shareholders' equity and cash flows for the years then ended.  These
financial statements are the responsibility of the Association's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Alliance Farms Cooperative
Association as of August 31, 1997 and 1996 and the results of its operations and
its cash flows for the years then ended, in conformity with generally accepted
accounting principles.



Kansas City, Missouri                                 KPMG Peat Marwick LLP
October 10, 1997



               ALLIANCE FARMS COOPERATIVE ASSOCIATION
                           BALANCE SHEETS

                                               August 31, 1997 and 1996

                                                1997                1996
ASSETS
Current Assets:
   Receivables, trade                           69,550              48,546
   Receivables, non-trade (Note 3)             200,137              23,902
   Inventory  (Note 4)                       3,179,402           2,435,477
   Other current assets                              0              48,273

       Total current assets                  3,449,089           2,556,198

   Property, plant and equipment, at cos    19,610,833          16,491,601
(Note 5)
   Less accumulated depreciation             2,193,650           1,333,291

                                            17,417,183          15,158,310


   Breeding stock                            4,603,996           3,928,215
   Less accumulated depreciation             1,353,650           1,013,872

                                             3,250,346           2,914,343
   Other assets, net of $77,261 and
     $51,568 accumulated amortization          263,788             216,762

                                           $24,380,406         $20,845,613



                                               1997                1996


LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
   Bank Overdraft                            1,106,122             575,749
Current maturities of long-term debt
   (Note 6)                                  1,262,700             870,000
   Accounts payable (Note 3)                   952,431             526,193
   Accrued Rebates (Note 2)                          0             670,167
   Accrued expenses                            242,261             171,791

     Total current liabilities               3,563,514           2,813,900

Long-term debt (Note 6)                     14,320,724          13,425,424

Shareholders' equity
   Class A Common stock of $.01 par
value;  authorized
     5,000 shares; issued and outstandin
119 shares
     (102 shares at August 31, 1996)                 1                   1
   Class B Common stock of $.01 par
value;  authorized
     2,500 shares; none issued                      --                  --
   Class C Common stock of $.01 par
value;  authorized
     2,500 shares; none issued                      --                  --
   Additional paid-in capital                8,719,237           7,487,653
   Accumulated deficit                      (2,223,070)         (2,881,365)

      Total shareholders' equity             6,496,168           4,606,289
     Commitments (Notes 7 and 8)                  ----                  --

                                           $24,380,406         $20,845,613




           See accompanying notes to financial statements

             ALLIANCE FARMS COOPERATIVE ASSOCIATION
                    STATEMENTS OF OPERATIONS

          For the years ended August 31, 1997 and 1996

                                            1997              1996

Net sales  (Notes 2 and 3)                $13,669,706        $7,037,927
Cost of goods sold (Note 3)                11,222,169         6,422,838


     Gross margin                           2,447,537           615,089

Expenses related to start-up
  of new production facilities                281,025           426,926
Administrative expenses                       424,565           369,787
(Gain) loss on sale of breeding stock         (94,123)          226,738


Operating income (loss)                    $1,836,070         ($408,362)

Other income (expense):
   Interest expense                        (1,321,984)       (1,001,329)
   Other                                      144,209            66,604

                                           (1,177,775)         (934,725)


Net income (loss)                            $658,295       ($1,343,087)



         See accompanying notes to financial statements


                ALLIANCE FARMS COOPERATIVE ASSOCIATION
                  STATEMENTS OF SHAREHOLDERS' EQUITY
<TABLE>

<CAPTION>

             For the years ended August 31, 1997 and August 31, 1996
                                                Class A           Additional                               Total
                                                common             paid-in          Accumulated        Shareholders'
                                                 stock             capital            deficit              equity


<S>                                              <C>                 <C>                  <C>                 <C>
Balance at
   August 31, 1995                                $1                  6,165,970           (1,538,278)           4,627,693

Sale of 17 shares of Class A
common stock - $.01 par per
share, net of $38,317 offering costs              ---                 1,321,683             ---                 1,321,683

Net loss                                          ---                 ---                 (1,343,087)          (1,343,087)


Balance at August 31, 1996                         1                  7,487,653           (2,881,365)           4,606,289

Sale of 17 shares of Class A
common stock - $.01 par per
share, net of $128,416 offering costs             ---                 1,231,584             ---                 1,231,584

Net income                                        ---                 ---                    658,295              658,295


Balance at August 31, 1997                         1                  8,719,237           (2,223,070)           6,496,168


                     See accompanying notes to financial statements
</TABLE>



                ALLIANCE FARMS COOPERATIVE ASSOCIATION
                       STATEMENTS OF CASH FLOWS

               For the years ended August 31, 1997 and 1996

                                                        1997           1996


Cash flow from operating activities:
   Net income (loss)                                     658,295     (1,343,087)
   Adjustment to reconcile net income (loss) to net
   cash provided by (used in) operating activities:
        Provision for depreciation and amortization    2,179,473      1,721,482
        (Gain) loss on sale of breeding stock            (94,123)       226,738
   Changes in assets and liabilities:
        Receivables                                     (197,239)       (40,561)
        Inventory                                       (743,925)    (1,366,333)
        Other current assets                              48,273        (28,999)
        Other assets                                     (70,896)       (38,593)
        Accounts payable                                 426,238       (146,764)
        Accrued rebates                                 (670,167)       629,028
        Accrued expenses                                  70,470        106,640

            Net cash provided by (used in)             1,606,399       (280,449)

               operating activities
Cash flows from investing activities:
   Capital expenditures                               (5,896,799)    (8,808,888)
   Proceeds from sale of breeding stock                1,246,443        626,268

          Net cash used in investing activities       (4,650,356)    (8,182,620)

Cash flows from financing activities:
   Proceeds from issuance of long term debt            1,877,131      3,798,000
   Net increase in revolving term credit                 300,869      1,276,000
   Payment on long term debt                            (870,000)      (580,000)
   Increase (decrease) in note payable to Farmland       (20,000)       636,424
   Issuance of Class A common stock, net of offering   1,231,584      1,321,683
costs
  Loan origination fees                                   (6,000)       (42,000)
   Increase in bank overdraft                            530,373        575,749
           Net cash provided by
               financing activities:                   3,043,957      6,985,856


            Decrease in cash and cash
                 equivalents                                   0     (1,477,213)

Cash and cash equivalents at beginning of period       $       0      1,477,213

Cash and cash equivalents at end of period             $       0              0


Supplemental schedule of cash paid for interest:      $1,337,319        989,334

                 See accompanying notes to financial statements




ALLIANCE FARMS COOPERATIVE ASSOCIATION

Notes to Financial Statements

1.   Description of the Business and Summary of Significant Accounting Policies
     Alliance Farms Cooperative Association (Alliance) is a cooperative
     association engaged in the production of feeder pigs for sale to its
     members. As of August 31, 1997, Alliance owned and was operating five
     2,450-sow feeder pig production facilities in Yuma County, Colorado, one
     2,450-sow feeder pig production facility in Wayne County, Illinois and a
     second comparable facility was being developed in Wayne County, Illinois.

     ( a )     Inventory

     Inventories are stated at the lower of cost or market.  Cost has been
     determined by the average cost method for feeder pigs and under the FIFO
     method for other inventories.

     Inventoriable costs are costs incurred in producing feeder pigs at the
     feeder pig production facility from the time of gestation through sale of
     the feeder pig.  Such costs include feed, care and a proportionate share of
     the depreciation of the breeding stock and facilities.  Market value used
     for purposes of computing lower of cost or market approximates the ultimate
     sale price of feeder pigs which is determined contractually between
     Alliance Farms and its members/patrons.

     ( b )     Property, Plant and Equipment

     Property, plant and equipment are stated at cost.  Depreciation is
     calculated on the straight-line method over the estimated useful lives of
     the assets, generally from three to twenty years.  Major repairs that
     extend the life of an asset are capitalized.  Normal repair and maintenance
     costs are expensed.

     Statement of Financial Accounting Standards No. 121 - Accounting for the
     Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of
     ("Statement 121") was adopted by Alliance on September 1, 1996.  Statement
     121 establishes accounting standards for the impairment of long-lived
     assets, certain identifiable intangible assets and goodwill related to
     those assets to be held and used and for long-lived assets and certain
     identifiable intangibles to be disposed of.  The adoption of Statement 121
     is not expected to have a significant impact on Alliance's financial
     statements.

     ( c )     Breeding Stock

     Breeding stock is stated at cost.  Depreciation on breeding stock is
     calculated on the straight-line method over the estimated breeding life of
     the animals, three years.

     ( d )     Cash and Cash Equivalents

     Cash and cash equivalents in the accompanying statement of cash flows
     include cash on hand and short-term investments with original maturities of
     less than ninety days.

     ( e )     Other Assets

     Other assets consist of organizational costs which are amortized over five
     years and loan origination fees which are amortized over the term of the
     loan, 12 years.

     ( f )     Sales

     Alliance Farms recognizes sales at the time pigs are shipped.

     ( g )     Income Taxes

     Alliance operates as a cooperative that is not exempt from federal income
     taxes and, therefore, is subject to taxes on all income not paid or
     allocated to members.  Deferred income taxes have not been provided because
     all sales since inception have been to members and all future sales are
     anticipated to be to members.

     Alliance incurred patronage-sourced losses through August 31, 1996 which
     were not allocated to members.  These patronage-sourced losses are
     therefore available to offset future patronage-sourced income.  During the
     year ended August 31, 1997, a portion of patronage- sourced losses were
     used to offset 1997 patronage-sourced income.  At August 31, 1997,
     approximately $3,594,000 of patronage-sourced losses were available to
     offset future patronage-sourced income.  These losses expire in 2009
     through 2011.

     (h)  Common Stock
     
     The common stock of Alliance is subject to certain restrictions as to
     transferability and Alliance has the right to purchase a member's common
     stock under certain circumstances.

     The authorized common stock of Alliance consists of Class A common stock,
     Class B common stock and Class C common stock.  Only qualified agricultural
     producers who have executed and delivered a Feeder Pig Purchase Agreement
     may own Class A common stock, only qualified agricultural producers who
     have executed and delivered a Weaned Pig Purchase Agreement may own Class B
     common stock, and only qualified agricultural producers who have executed
     and delivered a Class C Weaned Pig Purchase Agreement may own Class C
     common stock.  Holders of Class A common stock and Class B common stock are
     entitled to one vote for each share held, and holders of Class C common
     stock are entitled to three-fourths of one vote for each share held.  The
     preferences, powers and rights of Class A, Class B and Class C common stock
     are otherwise identical.

     Alliance intends to compute its patronage-sourced income or loss separately
     for each class of stockholders (members).

     ( i )     Use of Estimates

     Management of Alliance has made a number of estimates and assumptions
     relating to the reporting of assets and liabilities and the disclosure of
     contingent assets and liabilities to prepare these financial statements in
     conformity with generally accepted accounting principles.  Actual results
     could differ from those estimates.

2.   Sales

     Alliance has sold 100% of its feeder pigs to its members for the fiscal
     years ended August 31, 1997 and 1996 at a contractual price which is based
     on Alliance's operating costs (which are based on a twelve month rolling
     average), debt service and  an additional $4.50 per pig.

     Alliance's sales for the fiscal year ended August 31, 1996 were reduced by
     the accrual of a rebate of  $670,167.  The 1996 rebate was paid to members
     during fiscal 1997.  Alliance has not accrued a rebate in fiscal 1997 as it
     does not intend to pay a rebate to its members on fiscal 1997 sales.

     Because the contractual price for the sale of a feeder pig is determined
     based upon, among other things, a twelve month historical rolling average
     for operating costs and to the extent that current operating costs per pig
     exceed the historical average operating costs, Alliance may incur a
     negative gross margin on the sale of its feeder pigs during periods of
     rising costs.

     Alliance's average net sales price and the average industry market price
     were as follows:

                                             Fiscal Year Ended
                                                   August 31
                                               1997       1996   


               Average Net Sales Price         59.02     48.12
               Average Industry Market*        56.84     41.15

     *As published by Spark's Companies, Inc. (from the USDA's Market News
Service)

3.   Transactions with Farmland and Yuma Cooperative

     As of August 31, 1997 and 1996, Farmland Industries, Inc. (Farmland) owned
     approximately 43.7% and 49%, respectively, of the Common Stock of Alliance,
     and Yuma Farmers' Milling and Mercantile Cooperative (Yuma Cooperative)
     owned approximately 10.08% and 11.8%, respectively, of the Common Stock of
     Alliance.

     Alliance purchased feed from Yuma Cooperative and animal health supplies
     and breeding stock from Farmland based on market prices.  Yuma Cooperative
     and Farmland are members of Alliance.  Alliance also sold feeder pigs to
     Farmland and Yuma Cooperative.  Such purchases and sales were as follows:

                                        Fiscal Year Ended
                                            August 31
                                          1997          1996

          Feed Purchases                $4,338,732     $3,423,773
          Animal Health Purchases          638,730        303,963
          Breeding Stock                 2,367,524        872,979
          Feeder Pig Sales               7,924,763      5,035,160

     Farmland also pays Alliance a royalty for any pigs raised by Alliance and
     sold to a Farmland finisher that are then selected as breeding stock for
     Farmland's contract herds pursuant to a swine production services
     agreement.  The royalty, which is $10 per head selected, paid to Alliance
     under such agreement was as follows:

                                       Fiscal Year Ended
                                           August 31
                                       1997      1996

               Royalty Income        $123,620          $31,590


     Farmland provides Alliance with an administrative office in Yuma, Colorado
     at no cost.  Farmland also performs administrative, advisory and consulting
     services on behalf of Alliance pursuant to a contractual agreement.  The
     agreement provides that Farmland will be compensated for such services in
     an amount equal to one dollar per pig shipped adjusted annually for
     inflation for a term of ten years commencing July 13, 1994.  Amounts paid
     by Alliance to Farmland under such agreement were as follows:

                                   Fiscal Year Ended
                                       August 31
                                    1997             1996

          Management Fee            $250,967      $151,905


     Alliance had $200,137 and $23,902 of non-trade receivables at August 31,
     1997 and 1996, respectively.  Of the $200,137 due Alliance at August 31,
     1997, $120,195 was due from Yuma Cooperative as a result of a feed pricing
     adjustment and the remainder was due from Farmland for items received out
     of Alliance's shop stock inventory, and from Pig Producers I, LP ("Pig
     Producers"), a limited partnership in which Farmland holds a 12.5%
     interest, for the reimbursement of wages, benefits and other costs
     attributable to Alliance employees that are assigned to perform various
     duties at Pig Producers, as well as for items received out of Alliance's
     shop stock inventory.  The $23,902 due Alliance at August 31, 1996 was due
     for wages and benefits as described above from Pig Producers, in addition
     to charges for items received out of Alliance's shop stock inventory by
     both Pig Producers and Farmland.

     Alliance owed $197,755 and $185,413 at August 31, 1997 and $38,650 and
     $137,722 at August 31, 1996 to Farmland and Yuma Cooperative, respectively,
     for goods and services.  Alliance is also obligated to Farmland in the
     amount of $616,424 at August 31, 1997 pursuant to a $760,000 promissory
     note.  See note 6.

4.   Inventory

     Major components of inventories as of August 31, 1997 and  August 31, 1996
     are as follows:
                              1997          1996

     Feeder Pigs            $2,922,594      $2,265,056
     Other                     256,808         170,421

                            $3,179,402      $2,435,477




5.   Property, Plant and Equipment

     Property, plant and equipment at August 31, 1997 and 1996 consisted of  the
following:

                                  1997              1996

     Land                   $ 1,875,125       $ 1,717,079
     Buildings               15,693,994        13,129,134
     Site Improvements        1,494,249         1,019,936
     Machinery and equipment    368,572           254,316
     Mobile equipment            60,719            27,346
     Furniture and office
        equipment                21,454            21,694
     Construction in progress    96,720           322,096

                           $ 19,610,833       $16,491,601




6.   Long-Term Debt

     Long term debt at August 31, 1997 and 1996 consisted of the following:

                                        1997           1996

     CoBank Term Loan              $12,525,131         $11,518,000
     CoBank Revolving Term Credit    2,441,869           2,141,000
     Note Payable to Farmland          616,424             636,424

                                    15,583,424          14,295,424

     Less Current Maturities         1,262,700             870,000

                                   $14,320,724         $13,425,424


     On May 19, 1995, Alliance entered into a $23,600,000 secured credit
     facility with CoBank.  This agreement provided for $18,850,000 of term
     loans and $4,750,000 of revolving term credit.  Proceeds from the term
     loans are used for construction of feeder pig production facilities and are
     advanced by CoBank as Alliance incurs construction costs.  Proceeds from
     revolving term credit may be used for working capital and other purposes.
     The unused commitments expire December 31, 1997 for the term loans and June
     20, 2006 for the revolving term credit.  Interest accrues on the
     outstanding principle balance of the loan at a rate equal to CoBank's
     national variable rate, plus 1.25% (9.75% at August 31, 1997).  Alliance
     capitalized $29,533 and $38,181 of interest on construction for the fiscal
     years ended August 31, 1997 and 1996 respectively.

     At August 31, 1997, $443,869 of term loans were immediately available,
     $211,000 of term loans will be made available by CoBank upon final
     acceptance of the feeder pig production facility under construction in
     Wayne County, Illinois and $938,131 of revolving term credit was
     immediately available.

     Additional amounts available of term loans of $4,220,000 and revolving term
     credit of $1,220,000 are restricted and available only as additional shares
     of common stock are sold ($2,110,000 of term loans and $610,000 of
     revolving term credit for every $1,360,000 of common stock sold).

     Alliance is required to comply with various covenants, including, but not
     limited to (i) maintaining at least $3,900,000 of shareholder's equity,
     (ii) maintaining modified working capital (calculated as current assets,
     plus the available revolving term credit, minus current liabilities
     excluding the current portion of term debt payments) of at least $504,000,
     (iii) restrictions on the incurrence of additional indebtedness, and (iv)
     restrictions on the declaration and payment of the cash portion of
     patronage distributions and other distributions or allocations of earnings,
     surplus or assets.  As of August 31, 1997 Alliance was in compliance with
     all covenants.  Alliance may be required to make equity investments in
     CoBank in an amount not to exceed 1% of the average five-year principal
     loan balance until Alliance meets CoBank's target level of equity
     investment, which is currently 11.5% of the average five-year principal
     loan balance.  As of August 31, 1997, substantially all assets of Alliance
     were pledged to CoBank.

     At August 31, 1997, $616,424 had been borrowed from Farmland pursuant to a
     $760,000 loan agreement.  The loan agreement with Farmland provides for
     interest at CoBank's prime rate and requires repayment in 2005.

     Long-term debt as of August 31, 1997 matures during the fiscal years ending
     August 31 in the following amounts:

                         1998    $ 1,262,700
                         1999      1,550,400
                         2000      1,550,400
                         2001      1,550,400
                         2002      1,550,400
                    Thereafter     6,289,924

                                 $15,583,424




     7.   Operating Leases

     Alliance incurred $121,754 and $2,137 of lease expenses related to
     operating lease agreements for facilities and equipment for the fiscal
     years ended August 31, 1997 and 1996, respectively.  Future minimum lease 
     payments for the next five fiscal years ending August 31 are as follows:

                         1998         $266,954
                         1999           23,319
                         2000           23,319
                         2001           23,319
                    2002 and thereafter 23,319

                                      $342,740

     8.   Commitments

     As of August 31, 1997, Alliance Farms was operating six 2,450 sow feeder
     pig production units and had an additional unit under construction.   At
     August 31, 1997, commitments for construction of such facilities totaled
     approximately $699,000.  These commitments will be funded through bank
     borrowings.

     9.   Fair Value of Financial Instruments

     Alliance has financial instruments which are comprised of cash and cash
     equivalents, receivables, payables, and long-term debt.  The fair value of
     long-term debt is estimated using current interest rates for similar
     instruments.  The fair value of long-term debt approximates the carrying
     amount at August 31, 1997 because the long-term debt accrues interest at a
     variable rate. The carrying amounts of cash and cash equivalents,
     receivables and payables approximate fair value because of the short
     maturity of these instruments.


SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(D) OF THE EXCHANGE ACT BY NON-REPORTING ISSUERS

     No annual report to security holders covering the fiscal year ended August
31, 1997 or proxy statement, form of proxy or other proxy soliciting material
has been sent by the Registrant to security holders.  The Registrant anticipates
that an annual report will be furnished to security holders subsequent to the
filing of this Annual Report on Form 10-KSB.  The Registrant undertakes to
furnish copies of such annual report to the Commission when it is sent to
security holders.
                                   SIGNATURES

          In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                          ALLIANCE FARMS COOPERATIVE ASSOCIATION



                                          By:   /s/  Wayne N. Snyder          
                                    
                                                Wayne N. Snyder, President

Dated:  November  26, 1997

      In accordance with the Exchange Act, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on
the dates indicated.

Signature and Title                                         Date


 /s/ Wayne N. Snyder                                  November 26, 1997

Wayne N. Snyder
Chairman of the Board, President and Director
(Principal Executive Officer and Principal
Financial and Accounting Officer)


      *                                               November 26, 1997
Doug Brown
Treasurer, Secretary and Director


      *                                               November 26, 1997
Merl Daniel
Director


      *                                               November 26, 1997
Gerald D. Johnson
Director


      *                                               November 26, 1997
Loren Keppy
Director



*     By     /s/ Wayne N. Snyder                      November 26, 1997
            Wayne N. Snyder, Attorney-in-Fact