2011-13485. United States Standards for Grades of Potatoes

AGENCY:

Agricultural Marketing Service, USDA.

ACTION:

Final rule.

SUMMARY:

This rule revises the United States Standards for Grades of Potatoes. These standards are issued under the Agricultural Marketing Act of 1946. The Agricultural Marketing Service (AMS) is amending the similar varietal characteristic requirement to allow mixed colors and/or types of potatoes when designated as a mixed or specialty pack. Additionally, AMS is adding restrictive tolerances for permanent defects in the en route/at destination tolerances, removing the unneeded definition for injury, and clarifying the scoring guide for sprouts. AMS is also adding table numbers to the definitions of “Damage,” “Serious Damage,” and “External Defects,” amending table headings, replacing omitted language in the definition for bruises and amending language in the tolerance section to ensure soft rot tolerances are applied correctly. The purpose of this revision is to update and revise the standards to more accurately represent today's marketing practices and to clarify existing language.

DATES:

Effective June 3, 2011.

FOR FURTHER INFORMATION CONTACT:

Dr. Carl Newell, Standardization and Training Section, Fresh Products Branch, [phone]. The United States Standards for Grades of Potatoes are available through the Fresh Products Branch Web site at http://www.ams.usda.gov/​freshinspection.

SUPPLEMENTARY INFORMATION:

Executive Order 12866 and 12988

The Office of Management and Budget has waived the review process required by Executive Order 12866 for this action. This rule has been reviewed under Executive Order 12988, Civil Justice Reform. This action is not intended to have retroactive effect. There are no administrative procedures which must be exhausted prior to any judicial challenge to the provisions of the rule.

Regulatory Flexibility Act and Paperwork Reduction Act

Pursuant to the requirements set forth in the Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612) and in the Paperwork Reduction Act (PRA), AMS has considered the economic impact of the amended actions on small entities. The purpose of the RFA is to fit regulatory actions to the scale of businesses subject to such actions in order that small businesses will not be unduly or disproportionately burdened. Accordingly, AMS has prepared this final regulatory flexibility analysis. Interested parties are invited to submit information on the regulatory and informational impacts of these actions on small businesses.

This rule revises the U.S. Standards for Grades of Potatoes that were issued under the Agricultural Marketing Act of 1946 (7 U.S.C. 1621-1627). Standards issued under the 1946 Act are voluntary.

Small agricultural service firms, which include handlers and importers, have been defined by the Small Business Administration (SBA) (13 CFR 121.201) as those having annual receipts of less than $7,000,000, and small agricultural producers are defined as those having annual receipts of less than $750,000. Using annual data from the National Agricultural Statistics Service (NASS), the average potato crop value for 2006-2008 was $3.482 billion. Dividing that figure by 15,014 farms yields an average potato crop value per farm of just under $232,000. Since this is well under the SBA threshold of annual receipts of $750,000, it can be concluded that the majority of these producers may be classified as small entities. Furthermore, there are approximately 180 handlers of potatoes and approximately 168 importers of potatoes that may be classified as small entities and may be affected by this rule.

Additional evidence comes from closely examining the Agricultural Census acreage breakdown. Out of a total of 15,014 potato farms in 2007, 19 percent were less than 10 acres and 66 percent were less than 100 acres. An estimate of the number of acres that it would take to produce a crop valued at $750,000 can be made by dividing the 2006-08 average crop value of $3.482 billion by the three-year average bearing acres of 1.097 million, yielding an average potato revenue per acre estimate of $3,174. Dividing $750,000 by $3,174 shows that farms with 236 acres received at least the average price in 2006-08 producing crops valued at $750,000 or more, and would therefore be considered large potato farms under the SBA definition. Looking at farm numbers for additional census size categories shows that 11,718 potato farms (78 percent) are under 220 acres and 11,994 (80 percent) are less than 260 acres. Since a farm with 236 acres of potatoes falls within this range, it can be concluded that the proportion of small potato farms under the SBA definition is between 78 and 80 percent of all U.S. potato farms. The effects of this rule are not expected to be disproportionately greater or smaller for small handlers, producers, or importers than for larger entities.

This rule will amend the similar varietal characteristic requirement, add restrictive tolerances for permanent defects in the enroute/at destination tolerances, remove the definition for injury, and clarify the scoring guides for sprouts. Additionally, this rule will add table numbers to the definitions of “Damage,” “Serious Damage,” and “External Defects,” amend table headings, replace omitted language in the definition for bruises, and amend the tolerance section to ensure soft rot tolerances are applied correctly. These actions will make the standard more consistent and uniform with marketing trends and practices. These actions will not impose any additional reporting or recordkeeping requirements on either small or large potato producers, handlers, or importers.

USDA has not identified any Federal rules that duplicate, overlap, or conflict with this rule. However, there are marketing programs which regulate the handling of potatoes under 7 CFR parts 945-948 and 953. Potatoes under a marketing order have to meet certain requirements set forth in the grade standards. In addition, potatoes are subject to section 8e import requirements under the Agricultural Marketing Act of 1937, as amended (7 U.S.C. 601-674) which requires imported potatoes to meet grade, size, and quality under the applicable marketing order (7 CFR part 980).

Alternatives to this rule were considered including the option of not issuing the rule. However, the need for revision has increased as a result of changing market characteristics, and this final rule represents input from the potato industry.

A proposed rule regarding these revisions to the United States Standards for Grades of Potatoes was published in the Federal Register on April 30, 2010 [75 FR 22707]. A comment period of thirty days was issued which closed June 1, 2010.

Comments

In response to the request for comments, AMS received comments from nine respondents. Six comments were from national or state trade associations representing potato growers, shippers, and receivers, of which two supported the proposal and four partially supported the proposal. One supporting comment was from a nationwide produce retail chain. Another supporting comment was from a foreign government agency representing its agricultural inspection service. One comment came from a non-supporting consumer, who opposed the proposal in general without providing any specific information. Additionally, one national trade association proposed an additional revision.

AMS proposed to amend the similar varietal characteristic requirement to allow mixed colors and/or types of potatoes when designated as a mixed or specialty pack. Supporting comments were received from five national or state trade associations representing potato growers, shippers, and receivers, one nationwide produce retail chain, and one foreign government agency. One supportive commenter stated that there should only be a U.S. No. 1 mixed or specialty pack as allowing a U.S. No. 2 mixed or specialty pack downgrades the pack. The same commenter also suggested only allowing mixed colors and not mixed types of potatoes. AMS believes that allowing for both U.S. No. 1 and No. 2 mixed grade potatoes and to be mixed colors and/or types of potatoes allows for the appropriate amount of flexibility within the industry to meet current demand of consumers. Therefore, no changes were made to the standards based on these suggestions.

One objection came from a state trade association that believes consumers will prepare potatoes from the same container using one cooking step. This respondent does not find it acceptable for packers and repackers of Idaho potatoes to allow mixed types that perform differently, when cooked, to be packed in one bag. However, there were seven supporting commenters that believed that allowing mixed colors and/or types of potatoes when designated as a mixed or specialty pack will bring the standards in sync with current marketing practices and consumer demands in the United States and Canada. AMS agrees with these seven commenters. Therefore, AMS is revising the similar varietal characteristic requirement as proposed.

AMS also proposed to add restrictive tolerances for permanent defects in the en route/at destination tolerances. Two national trade associations representing potato growers and receivers and one nationwide produce retail chain supported the proposal. Four national and state trade associations representing potato growers and shippers opposed this revision. The opposing commenters believe that the new language will add confusion to the standards by causing market inspectors to misinterpret the difference between condition and permanent defects. Also, since permanent defects do not change over time, these commenters believe the restrictive tolerances are unnecessary.

On March 21, 2008, a final rule was published in the Federal Register (73 FR 15052) that added “en route” or “at destination” tolerances to the U.S. No. 1 and No. 2 grades. Prior to that rulemaking, there were only shipping point tolerances: For U.S. No. 1 a total of 8 percent, and for U.S. No. 2 a total of 10 percent. En route/at destination tolerances added for U.S. No. 1 potatoes allowed a total of 10 percent permanent defects, and for U.S. No. 2 potatoes a total of 12 percent permanent defects. AMS did not add restrictive tolerances to the en route/at destination tolerances in the 2008 final rule. Therefore 2 percent more permanent defects were allowed for both U.S. No. 1 and No. 2 between shipping point and at destination. This rulemaking adds a restrictive tolerance of not more than 8 percent for permanent defects in the U.S. No. 1 tolerances and not more than 10 percent for permanent tolerances in U.S. No. 2 that will ensure that shipping point and en route/at destination tolerances are properly the same.

In addition, AMS proposed to clarify the scoring guide for sprouts. Two national trade associations representing growers and receivers, one nationwide produce retail chain, and one foreign government agency were in favor of, but four national or state trade associations expressed concern regarding the phrase “or have numerous individual and/or clusters of sprouts which materially detract from the appearance of the potato.” Those commenters opposed to the change stated that the wording is too subjective and may nullify the length requirements for shipping point and destination. Currently, the wording in the standards can be interpreted to allow any cluster, no matter how small, to not only be scored as damage but also as serious damage. To ensure clarity, AMS proposed that clusters must be numerous and must materially or seriously detract from the appearance before being scored. Further, numerous individual sprouts that do not exceed the length requirements were also included. AMS believes that even though a potato may have sprouts, either individuals and/or clusters, not exceeding the length requirements, the appearance can be materially or seriously affected due to the sprouts being so numerous. Additionally, scoring numerous individual and/or clusters of sprouts based on materially or seriously detracting from the appearance does not nullify the length requirements for single individual sprouts or clusters. Therefore, AMS is revising the scoring guideline for sprouts as proposed.

Finally, one commenter pointed out that although AMS proposed to replace the omission of “or 6 oz.” in the definition of bruises in Table III—External Defects, it appears to be already included in this definition within the Standards. Upon further analysis, AMS determined that “or 6 oz.” was never omitted, and therefore does not need to be added back into the standards. However, the language “21/2 inch or” in the bruises definition was in fact inadvertently omitted as part of a previous rulemaking (73 FR 70585; November 21, 2008) but appear in the Standards. This rulemaking action is intended to rectify this error.

Therefore, AMS will revise the following as proposed: Remove the definition for injury, add table numbers to the definitions of “Damage,” “Serious Damage,” and “External Defects,” amend table headings, replace omission of “21/2 inch or” in the definition for bruises, and amend language in the tolerance section to ensure soft rot tolerances are applied correctly.

In addition to the comments on these proposed revisions, one national trade association representing potato receivers suggested that AMS reinstitute the 1 percent soft rot en route/at destination tolerance for the U.S. No. 1 and U.S. No. 2 grades. This proposal is outside the scope of this rulemaking but may be considered at a later time.

List of Subjects in 7 CFR Part 51

• Agricultural commodities
• Food grades and standards
• Fruits
• Nuts,

For reasons set forth in the preamble, 7 CFR part 51 is amended as follows:

PART 51—[AMENDED]

1. The authority citation for part 51 continues to read as follows:

Authority: 7 U.S.C. 1621-1627.

2. In § 51.1541, paragraph (a) is revised to read as follows:

§ 51.1541

U.S. No. 1.

* * * * *

(a) Similar varietal characteristics, except when designated as a mixed or specialty pack;

* * * * *

3. In § 51.1543, paragraph (a) is revised to read as follows:

§ 51.1543

U.S. No. 2.

* * * * *

(a) Similar varietal characteristics, except when designated as a mixed or specialty pack;

* * * * *

4. In § 51.1546, paragraph (a) is revised to read as follows:

§ 51.1546

Tolerances.

* * * * *

(a) For defects—(1) U.S. No. 1. (i) At Shipping Point: A total of 8 percent for potatoes in any lot which fail to meet the requirements for the grade: Provided, That included in this tolerance not more than the following percentages shall be allowed for the defects listed:

(A) 5 percent for external defects;

(B) 5 percent for internal defects; and

(C) Not more than a total of 1 percent for potatoes which are frozen or affected by soft rot or wet breakdown. See § 51.1547.

(ii) En route or at destination: A total of 10 percent for potatoes in any lot which fail to meet the requirements for the grade: Provided, That included in this tolerance not more than a total of 8 percent shall be allowed for permanent defects: And provided further, the following percentages shall be allowed for the defects listed:

(A) 7 percent for external defects, including therein not more than 5 percent for permanent external defects;

(B) 7 percent for internal defects, including therein not more than 5 percent for permanent internal defects; and

(C) Not more than a total of 2 percent for potatoes which are frozen or affected by soft rot or wet breakdown. See § 51.1547.

(2) U.S. Commercial: A total of 20 percent for potatoes in any lot which fail to meet the requirements for the grade: Provided, That included in this tolerance not more than the following percentages shall be allowed for the defects listed:

(i) 10 percent for potatoes which fail to meet the requirements for U.S. No. 2 grade, including therein not more than:

(ii) 6 percent for external defects;

(iii) 6 percent for internal defects; and

(iv) Not more than a total of 1 percent for potatoes which are frozen or affected by soft rot or wet breakdown. See § 51.1547.

(3) U.S. No. 2. (i) At Shipping Point: A total of 10 percent for potatoes in any lot which fail to meet the requirements for the grade: Provided, That included in this tolerance not more than the following percentages shall be allowed for the defects listed:

(A) 6 percent for external defects;

(B) 6 percent for internal defects; and

(C) Not more than a total of 1 percent for potatoes which are frozen or affected by soft rot or wet breakdown. See § 51.1547.

(ii) En route or at destination: A total of 12 percent for potatoes in any lot which fail to meet the requirements for the grade: Provided, That included in this tolerance not more than a total of 10 percent shall be allowed for permanent defects: And provided further, the following percentages shall be allowed for the defects listed:

(A) 8 percent for external defects, including therein not more than 6 percent for permanent external defects;

(B) 8 percent for internal defects, including therein not more than 6 percent for permanent internal defects; and

(C) Not more than a total of 2 percent for potatoes which are frozen or affected by soft rot or wet breakdown. See § 51.1547.

* * * * *

§ 51.1559

[Removed and Reserved]

5. Section 51.1559 is removed and reserved.

6. Section 51.1560 is revised to read as follows:

§ 51.1560

Damage.

“Damage” means any defect, or any combination of defects, which materially detracts from the edible or marketing quality, or the internal or external appearance of the potato, or any external defect which cannot be removed without a loss of more than 5 percent of the total weight of the potato. See Tables III, IV, V and VI in § 51.1564 and Table VII in § 51.1565.

7. Section 51.1561 is revised to read as follows:

§ 51.1561

Serious damage.

“Serious damage” means any defect, or any combination of defects, which seriously detracts from the edible or marketing quality, or the internal or external appearance of the potato, or any external defect which cannot be removed without a loss of more than 10 percent of the total weight of the potato. See Tables III, IV, V and VI in § 51.1564 and Table VII in 5§ 1.1565.

8. Section 51.1564 is amended by:

A. Amending the introductory text by removing the reference “Table III”, and by adding the reference “Tables III, IV, V and VI”, in its place.

B. Amending Table III by revising the column headings; and

C. Amending Table III by revising the entries for “Bruises (Not including pressure bruise and sunken discolored areas)” and “Sprouts”.

The revisions read as follows.

§ 51.1564

External defects.

* * * * *

Table III—External Defects

Defects	Damage	Serious damage1
*         *         *         *         *         *         *
Bruises (Not including pressure bruise and sunken discolored areas)	When removal causes a loss of more than 5 percent of the total weight of the potato or when the area affected is more than 5 percent of the surface in the aggregate (i.e., 3/4 inch on a 21/2 inch or 6 oz. potato). Correspondingly lesser or greater areas in smaller or larger potatoes	When removal causes a loss of more than 10 percent of the total weight of the potato or when the area affected is more than 10 percent of the surface in the aggregate (i.e., 11/4 inches on a 21/2 inch or 6 oz. potato). Correspondingly lesser or greater areas in smaller or larger potatoes.
*         *         *         *         *         *         *
Sprouts	When more than 5 percent of the potatoes in any lot have any sprout more than 1/4 inch in length at shipping point; more than 1/2 inch in length at destination; or have numerous individual and/or clusters of sprouts which materially detract from the appearance of the potato	When more than 10 percent of the potatoes in any lot have any sprout more than 1/2 inch in length at shipping point; more than 1 inch in length at destination; or have numerous individual and/or clusters of sprouts which seriously detract from the appearance of the potato. Serious damage by sprouts shall only be scored against the U.S. Commercial and U.S. No. 2 grades.
*         *         *         *         *         *         *
1 The following defects are considered serious damage when present in any degree: 1. Freezing. 2. Late blight. 3. Ring rot. 4. Southern bacterial wilt. 5. Soft rot. 6. Wet breakdown.

§ 51.1565

[Amended]

9. Section 51.1565 is amended by:

A. Amending the introductory text by removing the reference “Table IV”, and by adding the reference “Table VII”, in its place; and

B. Amending Table VII by removing the column heading “Damage maximum allowed” and adding the column heading “Damage Maximum Allowed” in its place, and by removing the column heading “Serious damage maximum allowed”, and by adding the column heading “Serious Damage Maximum Allowed” in its place.

Dated: May 24, 2011.

Rayne Pegg,

Administrator, Agricultural Marketing Service.