[Federal Register Volume 63, Number 14 (Thursday, January 22, 1998)]
[Rules and Regulations]
[Pages 3247-3251]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-1430]
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Rules and Regulations
Federal Register
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This section of the FEDERAL REGISTER contains regulatory documents
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Federal Register / Vol. 63, No. 14 / Thursday, January 22, 1998 /
Rules and Regulations
[[Page 3247]]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Parts 905 and 944
[Docket No. FV98-905-2 IFR]
Oranges, Grapefruit, Tangerines, and Tangelos Grown in Florida
and Imported Grapefruit; Relaxation of the Minimum Size Requirement for
Red Seedless Grapefruit
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Interim final rule with request for comments.
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SUMMARY: This interim final rule makes changes in the regulations under
the Florida citrus marketing order and the grapefruit import
regulations. This rule relaxes the minimum size requirement for red
seedless grapefruit and for red seedless grapefruit imported into the
United States from size 48 (3\9/16\ inches diameter) to size 56 (3\5/
16\ inches diameter). The Citrus Administrative Committee (Committee),
the agency that locally administers the marketing order for oranges,
grapefruit, tangerines, and tangelos grown in Florida, unanimously
recommended this change. This change allows handlers and importers to
ship size 56 red seedless grapefruit through November 8, 1998.
DATES: Effective January 23, 1998, through November 8, 1998; comments
received by March 23, 1998 will be considered prior to issuance of a
final rule.
ADDRESSES: Interested persons are invited to submit written comments
concerning this rule. Comments must be sent in triplicate to the Docket
Clerk, Fruit and Vegetable Division, AMS, USDA, Room 2525-S, P.O. Box
96456, Washington, D.C. 20090-6456; Fax: (202) 205-6632. All comments
should reference the docket number and the date and page number of this
issue of the Federal Register and will be available for public
inspection in the office of the Docket Clerk during regular business
hours.
FOR FURTHER INFORMATION CONTACT: William G. Pimental, Southeast
Marketing Field Office, F&V, AMS, USDA, P.O. Box 2276, Winter Haven,
Florida 33883; telephone: (941) 299-4770, Fax: (941) 299-5169; or Anne
M. Dec, Marketing Order Administration Branch, F&V, AMS, USDA, room
2522-S, P.O. Box 96456, Washington, DC 20090-6456; telephone: (202)
720-2491, Fax: (202) 720-5698. Small businesses may request information
on compliance with this regulation by contacting Jay Guerber, Marketing
Order Administration Branch, F&V, AMS, USDA, room 2525-S, P.O. Box
96456, Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202)
720-5698.
SUPPLEMENTARY INFORMATION: This rule is issued under Marketing
Agreement No. 84 and Marketing Order No. 905 (7 CFR Part 905), as
amended, regulating the handling of oranges, grapefruit, tangerines,
and tangelos grown in Florida, hereinafter referred to as the order.
The marketing agreement and order are effective under the Agricultural
Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674),
hereinafter referred to as the Act.
This rule is also issued under section 8e of the Act, which
provides that whenever specified commodities, including grapefruit, are
regulated under a Federal marketing order, imports of these commodities
into the United States are prohibited unless they meet the same or
comparable grade, size, quality, or maturity requirements as those in
effect for the domestically produced commodities.
The Department of Agriculture (Department) is issuing this rule in
conformance with Executive Order 12866.
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. This rule is not intended to have retroactive effect.
This rule will not preempt any State or local laws, regulations, or
policies, unless they present an irreconcilable conflict with this
rule.
The Act provides that administrative proceedings must be exhausted
before parties may file suit in court. Under section 608c(15)(A) of the
Act, any handler subject to an order may file with the Secretary a
petition stating that the order, any provision of the order, or any
obligation imposed in connection with the order is not in accordance
with law and request a modification of the order or to be exempted
therefrom. A handler is afforded the opportunity for a hearing on the
petition. After the hearing, the Secretary would rule on the petition.
The Act provides that the district court of the United States in any
district in which the handler is an inhabitant, or has his or her
principal place of business, has jurisdiction to review the Secretary's
ruling on the petition, provided an action is filed not later than 20
days after the date of the entry of the ruling.
There are no administrative procedures which must be exhausted
prior to any judicial challenge to the provisions of import regulations
issued under section 8e of the Act.
The order for Florida citrus provides for the establishment of
minimum grade and size requirements with the concurrence of the
Secretary. The grade and size requirements are designated to provide
fresh markets with fruit of acceptable quality and size, thereby
maintaining consumer confidence for fresh Florida citrus. This helps
create buyer confidence and contributes to stable marketing conditions.
This is in the interest of growers, handlers, and consumers, and is
designed to increase returns to Florida citrus growers. The current
minimum grade standard for red seedless grapefruit is U.S. No. 1. The
minimum size requirement for domestic shipments is size 56 (at least
3\5/16\ inches in diameter) through November 8, 1997, and size 48 (3\9/
16\ inches in diameter) thereafter. The current minimum size for export
shipments is size 56 throughout the year.
This interim final rule invites comments on a change to the order's
rules and regulations relaxing the minimum size requirement for
domestic shipments of red seedless grapefruit. This action allows for
the continued shipment of size 56 grapefruit. This rule relaxes the
minimum size from size 48 (3\9/16\ inches diameter) to size 56 (3 \5/
16\ inches diameter) through November 8, 1998. Absent this change, the
minimum size would be size 48 (3\9/16\ inches diameter). The Committee
met on October 14 and December 16, 1997, and unanimously recommended
this action.
[[Page 3248]]
Section 905.52 of the order, in part, authorizes the Committee to
recommend minimum grade and size regulations to the Secretary. Section
905.306 (7 CFR 905.306) specifies minimum grade and size requirements
for different varieties of fresh Florida grapefruit. Such requirements
for domestic shipments are specified in Sec. 905.306 in Table I of
paragraph (a), and for export shipments in Table II of paragraph (b).
This rule adjusts Table I to reflect the minimum size of 56 through
November 8, 1998. Minimum grade and size requirements for grapefruit
imported into the United States are currently in effect under
Sec. 944.106 (7 CFR 944.106). Export requirements are not changed by
this rule.
The Committee originally met to discuss this issue on October 14,
1997, and recommended releasing size 56 red grapefruit for a limited
time period this season. They voted to allow handlers to ship size 56
red seedless grapefruit through January 11, 1998, to give the Committee
time to determine the market effect of size 56.
The Committee met again on December 16, 1997, through an emergency
telephone meeting. The meeting was called to determine whether the
Committee wanted to release size 56 for the remainder of the season.
The Committee voted unanimously to extend the release of size 56
through November 8, 1998.
While wanting to give handlers the opportunity to continue to
market size 56, the Committee also wanted the opportunity to review the
effect of size 56 on the domestic market after the percentage of size
rule expired November 30, 1997 (62 FR 58633; October 30, 1997). The
percentage of size rule controlled the volume of sizes 48 and 56 that
was shipped in a given week, to both domestic and export markets. There
is a limited market for small sizes. However, the largest part of this
market is to export markets. The Committee is not sure to what extent
there is domestic demand for size 56. This minimum size change pertains
to the domestic market, and does not change the minimum size for export
shipments which will continue at size 56 throughout the season.
To determine if there is a domestic market for size 56, and the
effect of its presence on the market, the Committee recommended, on
October 14, 1997, allowing shipments of size 56 red seedless grapefruit
through January 11, 1998. The Committee agreed to revisit the issue to
evaluate the impact of size 56 on the market after the expiration of
volume regulation.
The Committee revisited the issue during the meeting December 16,
1997, and determined that size 56 should not be released until November
8, 1998. In making its recommendation, the Committee considered
estimated supplies and current shipments. The Committee examined the
size distribution information available for the current season. On
December 12, 1997, the Florida Agricultural Statistics Service (FASS)
reduced the marketable crop estimate for red seedless grapefruit by two
million boxes, or approximately seven percent for the 1997-98 season.
FASS also reported that red seedless grapefruit size as measured in
November, was 30.6 percent size 56 and smaller as compared to 35.5
percent as measured in November last year. This in turn compares to
only 16.8 percent measuring size 56 or smaller in November of 1995. So,
even though red seedless grapefruit are running larger than last
season, there are a fair number of small grapefruit.
The Committee also reviewed shipment data available through
November 23 of this season. Thus far, size 56 red seedless grapefruit
represents only 3.7 percent of total domestic shipments. Comparatively,
through the same time period, 11 percent of all red seedless grapefruit
shipments from Florida, domestic and export was size 56. Of the size 56
red seedless grapefruit shipped, 18 percent went to the domestic
market, while 82 percent was shipped to the export market.
In its discussion, the Committee recognized that fruit was
continuing to size. One member commented that fruit that had measured
size 56 in October, had sized up one size. This was helping to match
supplies of size 56 with demand. The Committee did have several
concerns. One topic that was raised was the currency and economic
problems currently facing the Pacific Rim countries. These countries
traditionally have been good markets for size 56 grapefruit. The
Committee was concerned that current conditions could reduce demand,
and alternative outlets would need to be available. The Committee
agreed that it would be advantageous to have the ability to ship size
56 red seedless grapefruit to the domestic market should problems
materialize in the export market.
One Committee member asked whether Texas was planning to market
size 56 grapefruit this season. The Committee was informed that Texas
would be selling size 56 for the entire season. The Committee believes
that some domestic markets may have been developed for size 56 and that
handlers should continue to supply those markets.
Based on the available information, the Committee unanimously
recommended that the minimum size for shipping red seedless grapefruit
to the domestic market should be size 56 through November 8, 1998.
This rule will have a beneficial impact on producers and handlers
since it will permit Florida grapefruit handlers to make available
those sizes of fruit needed to meet anticipated market demand for the
1997-98 season. This will provide for the maximization of shipments to
fresh market channels during this period. Additionally, importers will
be favorably affected by this change since the relaxation of the
minimum size regulation will also apply to imported grapefruit.
Section 8e of the Act provides that when certain domestically
produced commodities, including grapefruit, are regulated under a
Federal marketing order, imports of that commodity must meet the same
or comparable grade, size, quality, and maturity requirements. Since
this rule relaxes the minimum size requirement under the domestic
handling regulations, a corresponding change to the import regulations
is necessary.
Minimum grade and size requirements for grapefruit imported into
the United States are currently in effect under Sec. 944.106 [7 CFR
944.106]. This rule relaxes the minimum size requirements for imported
red seedless grapefruit to 3\5/16\ inches in diameter (size 56) for the
remainder of the 1997-1998 season ending on November 8, 1998, to
reflect the relaxation being made under the order for grapefruit grown
in Florida.
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA), the Agricultural Marketing Service (AMS) has considered the
economic impact of this action on small entities. Accordingly, AMS has
prepared this initial regulatory flexibility analysis.
The purpose of the RFA is to fit regulatory actions to the scale of
business subject to such actions in order that small businesses will
not be unduly or disproportionately burdened. Marketing orders issued
pursuant to the Act, and rules issued thereunder, are unique in that
they are brought about through group action of essentially small
entities acting on their own behalf. Thus, both statutes have small
entity orientation and compatibility. Import regulations issued under
the Act are based on those established under Federal marketing orders.
There are approximately 80 Florida citrus handlers subject to
regulation
[[Page 3249]]
under the marketing order, about 11,000 Florida citrus producers, and
about 25 grapefruit importers. Small agricultural service firms, which
include grapefruit handlers and importers, have been defined by the
Small Business Administration (13 CFR 121.601) as those whose annual
receipts are less than $5,000,000, and small agricultural producers are
defined as those whose annual receipts are less than $500,000.
Based on the Florida Agricultural Statistics Service and Committee
data for the 1995-96 season, the average annual f.o.b. price for fresh
Florida red grapefruit during the 1995-96 season was $5.00 per \4/5\
bushel cartons for all grapefruit shipments, and the total shipments
for the 1995-96 season were 23 million cartons of grapefruit.
Approximately 20 percent of all handlers handled 60 percent of Florida
grapefruit shipments. In addition, many of these handlers ship other
citrus fruit and products which are not included in Committee data but
would contribute further to handler receipts. Using the average f.o.b.
price, about 80 percent of grapefruit handlers could be considered
small businesses under the SBA definition and about 20 percent of the
handlers could be considered large businesses. The majority of
handlers, growers, and importers may be classified as small entities.
Florida shipped approximately 44,224,000 cartons of grapefruit to
the fresh market during the 1996-97 season. Of these cartons, about
25,586,000 were exported. In the past three seasons, domestic shipments
of Florida grapefruit averaged about 18,798,000 cartons. During the
period 1991 through 1996, imports have averaged 734,800 cartons a
season. Imports account for less than five percent of domestic
shipments.
Section 905.52 of the order, in part, authorizes the Committee to
recommend minimum grade and size regulations to the Secretary. Section
905.306 (7 CFR 905.306) specifies minimum grade and size requirements
for different varieties of fresh Florida grapefruit. This rule relaxes
the minimum size requirement for domestic shipments of red seedless
grapefruit from size 48 (3\9/16\ inches diameter) to size 56 (3\5/16\
inches diameter) through November 8, 1998. No change is being made in
the minimum size requirement for export shipments of size 56. Absent
this rule, the minimum size requirement for domestic shipments would be
size 48. The motion to allow shipments of size 56 red seedless
grapefruit through November 8, 1998, was passed by the Committee
unanimously.
The Committee originally met to discuss this issue on October 14,
1997, and recommended releasing size 56 red grapefruit for a limited
time period this season. They voted to allow handlers to ship size 56
red seedless grapefruit through January 11, 1998, to give the Committee
time to determine the market effect of size 56.
The Committee met again on December 16, 1997, through an emergency
telephone meeting. The meeting was called to determine whether the
Committee wanted to release size 56 for the remainder of the season.
The Committee voted unanimously to extend the release of size 56
through November 8, 1998.
In its discussion, the Committee recognized that fruit was
continuing to size. One member commented that fruit that had measured
size 56 in October, had sized up one size. This was helping to match
supplies of size 56 with demand. The Committee did have several
concerns. One topic that was raised was the currency and economic
problems currently facing the Pacific Rim countries. These countries
traditionally have been good markets for size 56 grapefruit. The
Committee was concerned that current conditions could reduce demand,
and alternative outlets would need to be available. The Committee
agreed that it would be advantageous to have the ability to ship size
56 red seedless grapefruit to the domestic market should problems
materialize in the export market.
One Committee member asked whether Texas was planning to market
size 56 grapefruit this season. The Committee was informed that Texas
would be selling size 56 for the entire season. The Committee believes
that some domestic markets may have been developed for size 56 and that
handlers should continue to supply those markets.
During the discussion of this rule, the Committee considered the
costs and benefits of this action. Several members stated that with the
volume of grapefruit available, the stagnant demand, and concerns
regarding the Asian export markets, it was important to take advantage
of any market available. There was also discussion that Texas was
planning to ship size 56 this season. Some members stated that if they
eliminated size 56, they would be losing markets. Members agreed that
maximizing fresh shipments helps grower returns. The Committee has
released size 56 for the past seven seasons. There should be no
production adjustment costs associated with this rule.
This rule is expected to have a positive impact on growers and
handlers, as it will permit the shipment of smaller sized red seedless
grapefruit to the domestic market, allowing the industry to meet
anticipated demand through November 8, 1998. This will provide for the
maximization of shipments to fresh market channels during this period.
This regulation lowers the minimum size to size 56. This minimum
applies to all handlers of red seedless grapefruit. The costs or
benefits of this rule are not expected to be disproportionately more or
less for small handlers or growers than for larger entities.
In 1996, imports of grapefruit totaled 15,000 tons (approximately
705,880 cartons). The Bahamas were the principal source, accounting for
95 percent of the total. Remaining imports were supplied by the
Dominican Republic and Israel. Imported grapefruit enters the United
States from October through May. Imports account for less than five
percent of domestic shipments.
Section 8e of the Act provides that when certain domestically
produced commodities, including grapefruit, are regulated under a
Federal marketing order, imports of that commodity must meet the same
or comparable grade, size, quality and maturity requirements. Because
this rule changes the minimum size for domestic red seedless grapefruit
shipments, this change will also be applicable to imported grapefruit.
This rule relaxes the minimum size to size 56. This regulation will
benefit importers to the same extent that it benefits Florida
grapefruit producers and handlers because it allows shipments of size
56 red seedless grapefruit into U.S. markets through November 8, 1998.
The Committee discussed alternatives to this action. One
alternative discussed was the elimination of size 56 grapefruit all
together. Several members expressed concern that a viable market has
been developed for a portion of the size 56 grapefruit crop. Not
allowing handlers to supply this market could result in throwing
business and money away. Other members pointed out that it could be
detrimental to supply this market for smaller sizes if that market is
not profitable and the result is depressed prices for all sizes of
grapefruit.
In addition, the Committee recognized that through November,
regulation was in place to control the amount of size 56 red seedless
grapefruit entering the market. Under the percentage of size rule, the
quantity of sizes 48 and/or 56 red seedless grapefruit that may be
shipped by a handler during a particular
[[Page 3250]]
week is calculated using a recommended percentage. This percentage of
size rule was in effect through November 30, 1997. The Committee agreed
that, for the remainder of the 1997-1998 season, no further restriction
on size 56 was necessary. A motion to eliminate size 56 was rejected.
This rule will not impose any additional reporting or recordkeeping
requirements on either small or large red seedless grapefruit handlers
or importers. As with all Federal marketing order programs, reports and
forms are periodically reviewed to reduce information collection
requirements and duplication by industry and public sectors.
In addition, the Department has not identified any relevant Federal
rules that duplicate, overlap or conflict with this rule. However, red
seedless grapefruit must meet the requirements as specified in the U.S.
Standards for Grades of Florida Grapefruit (7 CFR 51.760 through
51.784) issued under the Agricultural Marketing Act of 1946 (7 U.S.C.
1621 through 1627).
Further, the Committee's October meeting was widely publicized
throughout the citrus industry and all interested persons were invited
to attend the meeting and participate in Committee deliberations. Like
all Committee meetings, the October 14, 1997, meeting was a public
meeting and all entities, both large and small, were able to express
their views on this issue. Finally, interested persons are invited to
submit information on the regulatory and informational impacts of this
action on small businesses.
In accordance with section 8e of the Act, the United States Trade
Representative has concurred with the issuance of this interim final
rule.
After consideration of all relevant material presented, including
the Committee's recommendation, and other information, it is found that
this interim final rule, as hereinafter set forth, will tend to
effectuate the declared policy of the Act.
Pursuant to 5 U.S.C. 553, it is also found and determined, upon
good cause, that it is impracticable, unnecessary and contrary to the
public interest to give preliminary notice prior to putting this rule
into effect, and that good cause exists for not postponing the
effective date of this action until 30 days after publication in the
Federal Register because: (1) This rule relaxes the minimum size
requirement currently in effect for red seedless grapefruit grown in
Florida and red seedless grapefruit imported into the United States;
(2) Florida grapefruit handlers are aware of this action which was
unanimously recommended by the Committee, and they will need no
additional time to comply with the relaxed size requirement; (3)
shipments of the 1997-98 season Florida red seedless grapefruit crop
are underway; and (4) this rule provides a 60-day comment period, and
any comments received will be considered prior to any finalization of
this interim final rule.
List of Subjects
7 CFR Part 905
Grapefruit, Marketing agreements, Oranges, Reporting and
recordkeeping requirements, Tangelos, Tangerines.
7 CFR Part 944
Avocados, Food grades and standards, Grapefruit, Grapes, Imports,
Kiwifruit, Limes, Olives, Oranges.
For the reasons set forth above, 7 CFR parts 905 and 944 are
amended as follows:
1. The authority citation for 7 CFR parts 905 and 944 continues to
read as follows:
Authority: 7 U.S.C. 601-674.
PART 905--ORANGES, GRAPEFRUIT, TANGERINES, AND TANGELOS GROWN IN
FLORIDA
2. Section 905.306 is amended by adding entries in Table 1 of
paragraph (a) for ``seedless, red grapefruit'' to read as follows:
Sec. 905.306 Orange, Grapefruit, Tangerine, and Tangelo Regulation.
(a) * * *
Table I
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Minimum
diameter
Variety (1) Regulation period (2) Minimum grade (3) (inches)
(4)
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GRAPEFRUIT
* * * * * *
*
Seedless, red:
1/23/98-11/8/98............ U.S. No. 1................. 3-\5/16\
On and after 11/9/98....... U.S. No. 1................. 3-\9/16\
* * * * * *
*
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* * * * *
PART 944--FRUITS; IMPORT REGULATIONS
4. Section 944.106 is amended by adding entries in the table in
paragraph (a) for ``seedless red grapefruit'' to read as follows:
Sec. 944.106 Grapefruit import regulation.
(a) * * *
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Minimum
diameter
Grapefruit classification (1) Regulation period (2) Minimum grade (3) (inches)
(4)
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* * * * * *
*
Seedless, red:
1/23/98-11/8/98............ U.S. No. 1................. 3\5/16\
On and after 11/9/98....... U.S. No. 1................. 3\9/16\
[[Page 3251]]
* * * * * *
*
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* * * * *
Dated: January 15, 1998.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-1430 Filed 1-21-98; 8:45 am]
BILLING CODE 3410-02-P
