[Federal Register Volume 61, Number 208 (Friday, October 25, 1996)]
[Rules and Regulations]
[Pages 55202-55205]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-27456]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Parts 932 and 944
[Docket No. FV96-932-3FIR]
Olives Grown in California and Imported Olives; Establishment of
Limited-Use Olive Grade and Size Requirements
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Department of Agriculture (Department) is adopting as a
final rule, without change, the provisions of an interim final rule
authorizing the use of smaller-sized olives in the production of
limited-use styles for olives grown in California. This final rule
allows more olives into market channels and is consistent with current
market demand for olives. As required under section 8e of the
Agricultural Marketing Agreement Act of 1937, this final rule also
changes the olive import regulation so that it conforms with the
requirements established under the California olive marketing order.
EFFECTIVE DATE: November 25, 1996.
[[Page 55203]]
FOR FURTHER INFORMATION CONTACT: Terry Vawter, California Marketing
Field Office, Fruit and Vegetable Division, AMS, USDA, 2202 Monterey
Street, Suite 102B, Fresno, California, telephone (209) 487-5901; or
Caroline C. Thorpe, Marketing Specialist, Marketing Order
Administration Branch, F&V, AMS, USDA, room 2522-S, P.O. Box 96456,
Washington, DC 20090-6456; telephone: (202) 720-5127. Small businesses
may request information on compliance with this regulation by
contacting: Jay Guerber, Marketing Order Administration Branch, Fruit
and Vegetable Division, AMS, USDA, P.O. Box 96456, room 2523-S,
Washington, DC 20090-6456; telephone (202) 720-2491; Fax # (202) 720-
5698.
SUPPLEMENTARY INFORMATION: This final rule is issued under Marketing
Agreement No. 148 and Order No. 932 (7 CFR Part 932), as amended,
regulating the handling of olives grown in California, hereinafter
referred to as the ``order.'' The order is effective under the
Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-
674), hereinafter referred to as the ``Act.''
This final rule is also issued under section 8e of the Act, which
requires the Secretary of Agriculture to issue grade, size, quality, or
maturity requirements for certain listed commodities, including olives,
imported into the United States that are the same as, or comparable to,
those imposed upon the domestic commodities regulated under the Federal
marketing orders.
The 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 8c(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 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.
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.
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 under the Act
are based on those established under Federal marketing orders.
There are 4 handlers of California olives who are subject to
regulation under the marketing order and approximately 1,200 olive
producers in California. There are also approximately 25 importers of
olives subject to the olive import regulation. Small agricultural
service firms, which includes handlers and importers, have been defined
by the Small Business Administration (13 CFR 121.601) as those having
annual receipts of less than $5,000,000, and small agricultural
producers are defined as those whose annual receipts are less than
$500,000. None of the domestic olive handlers may be classified as
small entities. The majority of producers and importers may be
classified as small entities.
This rule provides that smaller olives may be used in the
production of limited-use styles (sliced, wedged, halved, or chopped)
and will assist the California olive industry as well as importers meet
the increasing market demand for such olives. Annual domestic shipment
data for olives indicate that for the last 5 seasons (1991 to 1995),
limited-use style shipments ranged from 35 percent to 41 percent of the
total annual domestic shipments. Absent this rule, many smaller
California olives would have to be disposed of in less-profitable, non-
canning uses, and the smaller olives from other countries could not be
imported into the United States. Both the California olive industry and
olive importers should, thus, benefit from the issuance of this rule.
Therefore, the AMS has determined that this action will not have a
significant economic impact on a substantial number of small entities.
An interim final rule was issued on July 31, 1996, and published in
the Federal Register (61 FR 40507, August 5, 1996), with an effective
date of August 8, 1996. That rule amended Sec. 932.153 of the rules and
regulations in effect under the order, and Sec. 944.401 of the import
regulations. That rule authorized the use of smaller-sized limited-use
olives under the order and for importation into the United States. That
rule provided a 30-day comment period which ended September 4, 1996. No
comments were received.
Nearly all of the olives grown in the United States are produced in
California. California olives are used for canned black ripe whole,
whole pitted, and sliced olives which are eaten out of hand as hors
d'oeuvres, or used as an ingredient in cooking, in salads, or on
pizzas. The canned ripe olive market is essentially a domestic market.
A few shipments of California olives are exported.
Olive production has fluctuated from a low of 24,200 tons during
the 1972-73 crop year to a high of 163,023 tons during the 1992-93 crop
year. The California Olive Committee (committee) indicated that the
total production for the 1995-96 crop year was 73,648 tons. While there
is no estimate yet available for the 1996-97 crop, it is expected to be
larger than the 1995-96 crop. Olive trees are subject to alternate
bearing characteristics. This may result in high production one year
and low the next, which can cause the total crop to vary greatly from
year to year.
Paragraph (a)(3) of Sec. 932.52 of the order provides that
processed olives smaller than the sizes prescribed for whole and whole
pitted styles may be used for limited-use styles, if recommended by the
committee and approved by the Secretary. The minimum sizes which can be
authorized for limited use were established in a 1971 amendment to the
marketing order. The use of smaller olives for limited-use styles has
been authorized in all but two crop years since the order was amended
in 1971.
Under the marketing order, olives smaller than the prescribed
minimum sizes which are authorized for limited uses must be disposed of
through less-profitable, non-canning uses such as in frozen or
acidified forms, or crushed for oil. Returns to producers are lower on
fruit used for such purposes.
[[Page 55204]]
On June 13, 1996, the committee recommended, by a unanimous vote,
establishment of quality and size regulations for limited-use size
olives on a continuing basis pursuant to paragraph (a)(3) of
Sec. 932.52 of the order. This rule authorizes the use of additional
olives for limited-use styles by relaxing the minimum sizes and making
more olives available to handlers for limited-use styles.
The minimum sizes authorized for limited-use styles by this rule
are smaller than those in effect last year, but are the same as those
in effect for the 1991-92, 1992-93, and 1993-94 crop years.
The minimum sizes were reduced for the 1991-92 season after handler
tests during the 1990-91 crop year confirmed the feasibility of using
such fruit in limited-use styles. However, the use of such fruit for
limited-use styles was not recommended by the committee for the 1994-95
season. At that time, the handlers reported that the use of certain
smaller olives in limited-use styles resulted in greater percentages of
broken slices, wedges, and halves. The inconsistencies of the product,
especially sliced olives, were not favored by the handlers' customers,
and the committee recommended that use of certain smaller olives for
limited-use styles be discontinued. At its recent meeting, the
committee recommended that limited-use sizes include the sizes
authorized prior to the 1994-95 season.
There have been substantial changes to olive pitting and slicing
equipment since the 1993-94 season. New machinery yields a greater
percentage of unbroken slices, wedges, and halves by making such
slices, wedges, and halves thicker and less likely to break. The new
equipment also eliminates the problem of double-feeding, in which the
pitter's feed wheel sends not one, but two, olives into the same
pitting chamber, leaving one of the two olives unpitted. Because of
these advances in the pitting and slicing equipment, the committee
believes that undersized olives may again be utilized in limited-use
styles effectively and to the satisfaction of the handlers' customers.
This rule will help growers and handlers meet the increasing market
demand for limited-use style olives based upon current conditions. This
demand can be illustrated in the increasing shipments of sliced olives
in the previous three years. Shipments of sliced olives increased by
17.11 percent from the 1991-92 season to the 1992-93 season and by an
additional 14.5 percent from the 1992-93 season to the 1993-94 season.
According to handlers, such shipments continue to increase. The
limited-use size requirements allow the use of sizes which would
otherwise have to be disposed of for less-profitable, non-canning uses.
Permitting the use of such smaller olives for limited-use styles
should, therefore, improve grower returns and help handlers meet the
increasing need for limited-use style olives.
The authority for limited-use size olives has been subject to an
annual reconsideration by the committee since first authorized in 1971.
The committee now believes that making the authority for limited-use
sizes continuous rather than annual will provide handlers an
opportunity to plan for and develop new markets, thereby increasing the
market share of domestically-produced olives. Such increased production
of limited-use sizes is expected to increase returns to growers.
Based on past production and marketing experience, the committee
believes that handlers will need smaller olives to meet market demand
for limited-use styles of canned olives. The committee also believes
that the handlers will need undersized olives on a continuing basis to
meet the market demand for limited-use styles of canned olives.
To effectuate this change, Section 932.153 of the order's rules and
regulations is being revised. The committee recommended that these new
minimum sizes become effective August 1, 1996, the beginning of the new
crop year.
Limited-use size olives are too small to meet the minimum size
requirements established for whole and whole pitted canned ripe olives.
However, they are large enough to be suitable for processing into
limited-use styles such as sliced, wedged, halved and chopped styles.
Absent this action, olives which are smaller than those authorized for
whole and whole pitted canning uses would have to be disposed of by
handlers into non-canning uses such as frozen or acidified forms, or
crushed for oil.
The specified sizes for the different olive variety groups are the
minimum sizes which are deemed desirable for use in the production of
limited-use styles at this time. As in past years, permitting the use
of smaller olives in the production of limited-use styles allows
handlers to take advantage of the strong market for sliced, wedged,
halved, and chopped style olives. By permitting the use of such olives,
handlers will be able to market more olives than would be permitted in
the absence of this relaxation in size requirements, thus increasing
returns to growers.
Although these limited-use sizes are effective for an indefinite
period, the committee will continue to meet prior to or during each
crop year to consider recommendations for modification of these
limited-use sizes. The dates and times of committee meetings are
available from the committee or the Department. Committee meetings are
open to the public and interested persons may express their views at
these meetings. The Department will evaluate the committee's
recommendations and other available information to determine whether
modification of the limited-use sizes is needed. Further rulemaking
will be undertaken as necessary.
Section 8(e) of the Act requires that whenever grade, size,
quality, or maturity requirements are in effect for olives under a
domestic marketing order, imported olives must meet the same or
comparable requirements. This rule allows smaller olives to be used in
the production of limited-use styles under the marketing order.
Therefore, a corresponding change is needed in the olive import
regulation.
Canned ripe olives, and bulk olives for processing into canned ripe
olives, imported into the United States must meet certain minimum
quality and size requirements specified in Olive Regulation 1 (7 CFR
Sec. 944.401). All canned ripe olives are required to be inspected and
certified prior to importation (release from custody of the United
States Custom Service), and all bulk olives for processing into canned
ripe olives must be inspected and certified prior to canning. ``Canned
ripe olives'' means olives in hermetically sealed containers and heat
sterilized under pressure, of two distinct types, ``ripe'' and ``green-
ripe'', as defined in the U.S. Standards for Grades of Canned Ripe
Olives. The term does not include Spanish-style green olives.
Any lot of olives failing to meet the import requirements may be
exported, disposed of, or shipped for exempt uses. Exportation or
disposal of such olives would be accomplished under the supervision of
the Processed Products Branch of the Fruit and Vegetable Division, with
the costs of certifying the disposal of the olives borne by the
importer. Exempt olives are those imported for processing into oil or
donation to charity. Any person may also import up to 100 pounds
(drained weight) of canned ripe olives or bulk olives exempt from these
quality and size requirements.
This final rule modifies paragraph (b)(12) of the olive import
regulation to authorize the importation of bulk olives which do not
meet the minimum size requirements established for olives for
[[Page 55205]]
whole and whole pitted uses to be used in the production of limited-use
styles. Such authority will be on a continuing basis, rather than on an
annual basis, as has been done in previous years.
This final rule also modifies paragraphs (b)(12)(i) through
(b)(12)(v) by relaxing the minimum sizes of olive permitted to be
imported for limited-use styles.
Permitting the use of smaller olives in the production of limited-
use styles will allow importers to better take advantage of the strong
market for sliced, wedged, halved, and chopped style olives. Importers
will be able to import and market more olives than would be permitted
in the absence of this relaxation in size requirements.
The two largest exporters of ripe and bulk olives to the United
States are Spain and Mexico, respectively. Imports comprise
approximately 50 percent of total annual U.S. consumption.
In accordance with section 8e of the Act, the U.S. Trade
Representative has concurred with the issuance of this final rule.
After consideration of all relevant material presented, the
information and recommendations submitted by the committee, and other
information, it is found that finalizing the interim final rule,
without change, as published in the Federal Register (61 FR 40507,
August 5, 1996) will tend to effectuate the declared policy of the Act.
List of Subjects
7 CFR Part 932
Marketing agreements, Olives, Reporting and recordkeeping
requirements.
7 CFR Part 944
Avocados, Food grades and standards, Grapefruit, Grapes, Imports,
Kiwifruit, Limes, Olives, Oranges.
For the reasons set forth in the preamble, 7 CFR parts 932 and 944
are amended as follows:
PART 932--OLIVES GROWN IN CALIFORNIA
Accordingly, the interim final rule amending 7 CFR part 932 which
was published at 61 FR 40507 on August 5, 1996, is adopted as a final
rule without change.
PART 944--FRUITS; IMPORT REGULATIONS
Accordingly, the interim final rule amending 7 CFR part 944, which
was published at 61 FR 40507 on August 5, 1996, is adopted as a final
rule without change.
Dated: October 18, 1996.
Eric M. Forman,
Acting Director, Fruit and Vegetable Division.
[FR Doc. 96-27456 Filed 10-24-96; 8:45 am]
BILLING CODE 3410-02-P
