[Federal Register Volume 60, Number 15 (Tuesday, January 24, 1995)]
[Proposed Rules]
[Pages 4571-4574]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-1778]
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DEPARTMENT OF AGRICULTURE
Commodity Credit Corporation
7 CFR Parts 1405 and 1413
RIN 0560-AD86
Common Provisions for the 1995 Wheat, Feed Grains, Cotton, and
Rice Programs, and Cost Reduction Options
AGENCY: Commodity Credit Corporation, USDA.
ACTION: Proposed rule.
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SUMMARY: The Agricultural Act of 1949, as amended (1949 Act), sets
forth numerous discretionary provisions that may be implemented by the
Commodity Credit Corporation (CCC) with respect to the 1995 crops of
wheat, feed grains, upland and extra long staple (ELS) cotton, and
rice. The Food Security Act of 1985, as amended (1985 Act), permits the
Secretary of Agriculture to take certain actions related to nonrecourse
loans and acreage reduction programs if it is determined that they will
reduce total direct and indirect commodity program costs without
adversely affecting incomes of small- and medium-sized producers. CCC
proposes to make the following program determinations with respect to
the price support and production adjustment programs: (a) the
percentage of the estimated deficiency payments that should be made
available in advance to producers of the 1995 crop of wheat, feed
grains, cotton, and rice; (b) the types of crops that may not be
planted on ``flexible acreage''; (c) whether to permit targeted option
payments (TOP); (d) whether to allow the planting of designated crops
on up to one-half of the reduced acreage; (e) whether to allow the
planting of oats on wheat and feed grains acreage conservation reserve
(ACR); (f) whether to allow planting of conserving crops on ACR; (g)
whether to allow alternative crops on conserving use acreage for
payment; and (h) whether to implement cost reduction options. This
proposed rule sets forth CCC's proposed action regarding these
determinations.
DATES: Comments must be received on or before January 27, 1995, in
order to be assured of consideration.
ADDRESSES: Interested persons are invited to submit written comments to
Acting Deputy Administrator, Policy Analysis, P.O. Box 2415,
Washington, DC 20013-2415, telephone 202-720-7583.
FOR FURTHER INFORMATION CONTACT: James A. Langley, Consolidated Farm
Service Agency, U.S. Department of Agriculture (USDA), Room 3090-S,
P.O. Box 2415, Washington, DC 20013-2415 or call 202-690-0640.
SUPPLEMENTARY INFORMATION:
Executive Order 12866
This proposed rule has been determined to be significant and was
reviewed by OMB under Executive Order 12886.
Preliminary Regulatory Impact Analysis
The Preliminary Regulatory Impact Analysis describing the options
considered in developing this proposed rule and the impact of the
implementation of each option is available on request from the above-
named individual. [[Page 4572]]
Executive Order 12778
This proposed rule has been reviewed in accordance with Executive
Order 12778. The provisions of the proposed rule are not retroactive
and preempt State laws only to the extent such provisions are
inconsistent with State laws. Before any judicial action may be brought
concerning these provisions, the administrative appeal remedies at 7
CFR part 780 must be exhausted.
Federal Assistance Programs
The titles and numbers of the Federal Assistance Programs, as found
in the catalog of Federal Domestic Assistance, to which this rule
applies are as follows:
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Titles Numbers
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Commodity Loans and Purchases................................ 10.051
Cotton Production Stabilization.............................. 10.052
Feed Grains Production Stabilization......................... 10.055
Wheat Production Stabilization............................... 10.058
Rice Production Stabilization................................ 10.065
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Regulatory Flexibility Act
It has been determined that the Regulatory Flexibility Act is not
applicable to this proposed rule since CCC is not required by 5 U.S.C.
553 or any other provision of law to publish a notice of proposed
rulemaking with respect to the subject matter of this rule.
Environmental Evaluation
It has been determined by an environmental evaluation that this
action will have no significant impact on the quality of human
environment. Therefore, neither an Environmental Assessment nor an
Environmental Impact Statement is needed.
Executive Order 12372
This program/activity is not subject to the provisions of Executive
Order 12372, which requires intergovernmental consultation with State
and local officials. See the Notice related to 7 CFR part 3015, subpart
V, published at 48 FR 29115 (June 24, 1983).
Paperwork Reduction Act
This proposed rule does not change the information collection
requirements that were previously approved by the Office of Management
and Budget (OMB) under provisions of 44 USC 33.
Background
This proposed rule would amend 7 CFR part 1413 to set forth the
determination of whether certain discretionary cost reduction options
of the 1985 Act will be implemented. Accordingly, the Secretary may
take the following actions if it is determined that they will reduce
total direct and indirect commodity program costs without adversely
affecting incomes of small- and medium-sized producers: (a) enter into
the commercial market to purchase commodities covered by nonrecourse
loans if the cost would be less than later acquiring the commodity
through loan defaults; (b) provide for settlement of nonrecourse loans
(including nonrecourse loans made to producers under the Farmer-Owned
Reserve Program) at less than full principal plus interest; or (c)
reopen signup to allow producers to submit bids for the conversion of
planted acreage to diverted acreage with payment in kind from CCC
stocks.
If, after the comment period, no cost reduction options are
implemented under the final rule, the Secretary still reserves the
right to initiate at a later date any action authorized by section 1009
of the 1985 Act, including the right to reopen and change a contract
entered into by a producer under the program if the producer
voluntarily agrees to the change.
This proposed rule would also amend 7 CFR part 1413 to set forth
the determination of whether certain discretionary provisions of the
1949 Act will be implemented and, if implemented, the manner in which
implementation would be made. Accordingly, the following program
determinations are proposed to be made with respect to the provisions
that are applicable to the 1995 crops of wheat, feed grains, upland and
ELS cotton, and rice:
A. The percentage of the estimated deficiency payments that should
be made available in advance to producers of the 1995 crop of wheat,
feed grains, cotton and rice.
Section 114 of the 1949 Act requires that advance deficiency
payments be made available to producers of wheat, feed grains, upland
cotton, and rice if an acreage limitation is in effect. Section 103 of
the 1949 Act provides discretionary authority to provide such payments
for ELS cotton. Producers who participate in farm programs have the
option to request advance deficiency payments. Advance payments must be
between 40 and 50 percent of the projected payments for wheat and feed
grains and between 30 and 50 percent for upland cotton and rice.
Advance payment for ELS cotton, if offered, cannot exceed 50 percent of
the projected payment rate.
CCC intends to make available advance deficiency payments of 50
percent of the projected payments for the 1995 crop of wheat, feed
grains, rice, upland cotton and, if applicable, ELS cotton.
B. The types of crops that may not be planted on flexible acres.
Section 504 of the 1949 Act states that producers may plant on a
farm crops other than the program crop on an acreage not to exceed 25
percent of any crop acreage base enrolled in the applicable CCC price
support and production adjustment program. This acreage is known as
``flexible'' acreage.
Crops that may be planted on flexible acreage are: (a) any program
crop; (b) any oilseed crop; (c) any other crop, except any fruit or
vegetable crop (including dry edible beans, lentils, peas, and
potatoes); and (d) mung beans. The planting of certain fruits or
vegetables may be permitted if such crop is an industrial or
experimental crop, or if no substantial domestic production or market
exists for the crop. The planting of any crop on flexible acres may
also be prohibited.
CCC intends to permit the same crops to be grown on flexible
acreage in 1995 as were allowed in 1994. However, CCC will consider
adding or removing crops to the list of prohibited crops that is set
forth at 7 CFR part 1413.43(b)(6).
C. Whether to implement TOP.
Sections 107B(e)(3), 105B(e)(3), 103B(e)(3), and 101B(e)(3) of the
1949 Act, with respect to wheat, feed grains, upland cotton, or rice,
provide that if an acreage limitation program is in effect, the
Secretary may offer producers the option of increasing or decreasing
the acreage reduction level, within certain restrictions, with a
corresponding increase or decrease in the established (target) price of
the commodity. The target price may be increased or decreased by not
less than 0.5 percent nor more than 1 percent for each percentage point
change in the acreage reduction level. The acreage limitation
requirement cannot be increased by more than 15 percentage points or
above 25 percent total for wheat; by more than 10 percentage points or
above 20 percent of the total for feed grains; by more than 10
percentage points or above 25 percent of the total for cotton; nor by
more than 5 percentage points or above 25 percent of the total for
rice. The decrease in the acreage limitation requirement for all crops
cannot be more than one-half of the announced acreage limitation
percentage.
The Secretary shall, to the extent practicable, ensure that the TOP
option does not have a significant effect on program participation or
total production and will result in no additional budget outlays.
[[Page 4573]]
Comments on whether this provision should be implemented for the
1995 crops are requested.
D. Whether to permit the planting of designated crops on up to half
of the announced acreage reduction.
Sections 107B(e)(2)(F)(i), 105B(e)(2)(F)(i), 103B(e)(2)(F)(i), and
101B(e)(2)(F)(i) of the 1949 Act, with respect to wheat, feed grains,
upland cotton, and rice, provide that the Secretary may permit
producers to plant a designated crop on not more than one-half of the
reduced acreage on the farm.
The designated crops may be: (a) any oilseed crop; (b) any
industrial or experimental crop designated by CCC; and (c) any other
crop, except any fruit or vegetable (including dry edible beans,
lentils, peas, and potatoes), not designated by the Secretary as (i) an
industrial or experimental crop, or (ii) a crop for which no
substantial domestic production or market exist. Program crops may not
be planted on the reduced acreage on the farm.
If producers on a farm elect to plant a designated crop, the amount
of deficiency payments that the producers are otherwise eligible to
receive shall be reduced, for each acre that is planted to the
designated crop, by an amount equal to the deficiency payment that
would be made with respect to a number of acres of the crop that the
Secretary considers appropriate. Such reductions in deficiency payments
must be sufficient to ensure that this provision does not increase CCC
outlays.
CCC intends to permit the harvesting of designated crops on up to
one-half of ACR for the 1995 crops.
E. Whether to permit the planting of oats on wheat and feed grain
ACR.
In any crop year that it is determined that projected domestic
production of oats will not fulfill the projected domestic demand for
oats, CCC: (a) may provide that acreage designated as ACR under the
wheat and feed grains programs may be planted to oats for harvest under
sections 107B(e)(8) and 105B(e)(8) of the 1949 Act; (b) may make
program benefits (including loans, purchases, and payments) available
under the annual program for oats under section 105B of the 1949 Act
for oats planted on ACR; and (c) shall not make program benefits other
than the benefits specified in (b) available to producers with respect
to acreage planted to oats under this provision.
It is proposed that the planting of oats on wheat and feed grains
ACR for harvest not be permitted for the 1995 crops.
F. Whether to permit conserving crops to be planted on ACR.
Under sections 107B(e)(4)(B)(iii), 105B(e)(4)(B)(iii),
103B(e)(4)(B)(iii), and 101B(e)(4)(B)(iii) of the 1949 Act, with
respect to wheat, feed grains, upland cotton, and rice, producers may
be authorized to plant all or any part of the ACR to castor beans,
crambe, guar, milkweed, mung beans, plantago ovato, sesame, sweet
sorghum, rye, triticale, or other commodity, if the Secretary
determines that the production is needed to provide an adequate supply
of the commodities, is not likely to increase the cost of the price
support program, and will not adversely affect farm income.
CCC intends to permit the harvesting of the following conserving
crops on ACR: castor beans, chia, crambe, crotalaria, cuphea, guar,
guayule, hesperaloe, kenaf, lesquerella, meadowfoam, milkweed, plantago
ovato, and sesame. However, CCC will consider adding to or removing
crops from the list of eligible conserving crops that is set forth at 7
CFR part 1413.8.
G. Whether to permit alternative crops on conserving use acres.
Under sections 107B(c)(1)(F)(i), 105B(c)(1)(F)(i),
103B(c)(1)(E)(i), and 101B(c)(1)(E)(i) of the 1949 Act, with respect to
wheat, feed grains, upland cotton, and rice, producers may be
authorized to plant all or any part of acreage otherwise required to be
devoted to conserving uses as a condition of qualifying for payment
under the so-called ``0/85/92'' or ``50/85/92'' provisions of the price
support and production adjustment programs to castor beans, guar,
millet, mung beans, plantago ovato, sweet sorghum, rye, triticale,
commodities for which no substantial domestic production or market
exists but that could yield industrial raw material being imported, or
likely to be imported, or commodities grown for experimental purposes
(including kenaf and milkweed). The Secretary may permit these crops to
be planted on conserving use acres only if the Secretary determines
that the production is not likely to increase the cost of the price
support program, is needed to provide an adequate supply of the
commodities, or is needed to encourage domestic manufacture of
industrial raw materials derived from these crops.
CCC intends to permit the harvesting of the following alternative
crops on conserving use acres: castor beans, chia, crambe, crotalaria,
cuphea, guar, guayule, hesperaloe, kenaf, lesquerella, meadowfoam,
milkweed, plantago ovato, and sesame. However, CCC will consider adding
to or removing crops from the list of eligible alternative crops that
is set forth at 7 CFR part 1413.8.
Accordingly, comments are requested with respect to these foregoing
issues.
List of Subjects
7 CFR Part 1405
Loan programs/agriculture, Price support programs.
7 CFR Part 1413
Cotton, Feed grains, Price support programs, Rice, Wheat.
Accordingly, it is proposed that 7 CFR parts 1405 and 1413 be
amended as follows:
PART 1405--LOANS, PURCHASES AND OTHER OPERATIONS
1. The authority citation for 7 CFR part 1405 is amended to read as
follows:
Authority: 15 U.S.C. 714b and 714c; 7 U.S.C. 1308a.
2. Part 1405 is amended by adding a new Sec. 1405.6 to read as
follows:
Sec. 1405.6 Cost reduction options.
With respect to the 1995 crop, no cost reduction options specified
in section 1009(c), (d), or (e) of the Food Security Act of 1985, as
amended (the 1985 Act), will be initially included in the program.
However, the Secretary reserves the right to initiate at a later date
any action not previously included but authorized by section 1009 of
the 1985 Act, including the right to reopen and change a contract
entered into by a producer under the program if the producer
voluntarily agrees to the change.
PART 1413--FEED GRAIN, RICE, UPLAND AND EXTRA LONG STAPLE COTTON,
WHEAT AND RELATED PROGRAMS
1. The authority citation for 7 CFR part 1413 continues to read as
follows:
Authority: 7 U.S.C. 1308, 1308a, 1309, 1441-2, 1444-2, 1444f,
1445b-3a, 1461-1469; 15 U.S.C. 714b and 714c.
2. In section 1413.54, paragraph (f) is revised to read as follows:
Sec. 1413.54 Acreage reduction program provisions.
* * * * *
(f) Producers may plant designated minor oilseeds, soybeans and
mung beans on up to 50 percent of the designated ACR acreage,
* * * * *
3. In Sec. 1413.64, the introductory text of paragraph (c) and
paragraph (d) are revised to read as follows: [[Page 4574]]
Sec. 1413.64 Nationally approved cover crops and practices for ACR and
CU for payment acreages.
* * * * *
(c) Producers may plant designated oilseeds, soybeans and mung
beans on up to 50 percent of the designated ACR acreage;
* * * * *
(d) Acreage designated as ACR or CU for payment under the 1995
wheat, feed grain, upland cotton and rice programs may be planted to
IOCs.
* * * * *
4. In Sec. 1413.66, paragraph (c)(2) is revised to read as follows:
Sec. 1413.66 Use of ACR and CU for payment acreage.
* * * * *
(c) * * *
(2) IOCs or designated crops planted on ACR and IOCs planted on CU
for payment acreage.
* * * * *
5. In Sec. 1413.105 paragraph (d) is revised to read as follows:
Sec. 1413.105 Timing and calculation of deficiency payments.
* * * * *
(d)(1) For the 1994 and 1995 crops of wheat, feed grains, upland
cotton, ELS cotton and rice, if an acreage limitation program is in
effect, CCC shall make available 50 percent of the projected final
deficiency payments, made in accordance with Sec. 1413.104, as an
advance payment to producers in the manner determined and announced by
CCC.
(2) For the 1996 and 1997 crops of wheat, feed grains, upland
cotton, ELS cotton and rice, if an acreage limitation program is in
effect, CCC shall make available 40 percent of the projected final
deficiency payments made in accordance with Sec. 1413.104, as an
advance payment to producers in the manner determined and announced by
CCC.
Signed January 19, 1995 at Washington, DC.
Bruce R. Weber,
Acting Executive Vice President Commodity Credit Corporation.
[FR Doc. 95-1778 Filed 1-19-95; 4:32 pm]
BILLING CODE 3410-05-P
