[Federal Register Volume 62, Number 34 (Thursday, February 20, 1997)]
[Rules and Regulations]
[Pages 7660-7663]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-4335]
-----------------------------------------------------------------------
DEPARTMENT OF AGRICULTURE
7 CFR Part 987
[Docket No. FV-96-987-3 FR]
Domestic Dates Produced or Packed in Riverside County,
California; Temporary Relaxation of Size Requirements for Deglet Noor
Dates
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This final rule revises the size requirements currently
prescribed for the Deglet Noor variety of dates under the California
date marketing order. The marketing order regulates the handling of
domestic dates produced or packed in Riverside County, California, and
is administered locally by the California Date Administrative Committee
(committee). This rule will increase the current tolerance for
individual, whole Deglet Noor dates weighing less than 6.5 grams (the
prescribed minimum) from 10 to 15 percent and will be in effect through
October 31, 1997. The relaxation is necessary because dates from the
1996-97 crop are smaller in size and weight than normal. The decrease
in size and weight is due to extremely high temperatures experienced
last spring in the production area. This relaxation was recommended by
the committee to make a larger quantity of the 1996-97 crop
[[Page 7661]]
available for sale domestically and in Canada and is expected to
benefit producers, handlers, and consumers.
EFFECTIVE DATE: This final rule becomes effective February 21, 1997.
FOR FURTHER INFORMATION CONTACT: Maureen Pello, California Marketing
Field Office, Marketing Order Administration Branch, F&V, AMS, USDA,
2202 Monterey Street, Suite 102B, Fresno, California 93721; telephone:
(209) 487-5901, Fax # (209) 487-5906; or Valerie L. Emmer, Marketing
Specialist, Marketing Order Administration Branch, F&V, AMS, USDA, room
2536-S, P.O. Box 96456, Washington, DC 20090-6456: telephone: (202)
205-2829, Fax # (202) 720-5698. 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 2525-S, Washington, DC 20090-
6456: telephone (202) 720-2491; Fax # (202) 720-5698.
SUPPLEMENTARY INFORMATION: This final rule is issued under Marketing
Agreement and Order No. 987 (7 CFR part 987), both as amended,
regulating the handling of domestic dates produced or packed in
Riverside County, California, 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.''
The Department of Agriculture (Department) is issuing this rule in
conformance with Executive Order 12866.
This final 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 date of the entry of the ruling.
This final rule revises the size requirements currently prescribed
for the Deglet Noor variety of dates under the California date
marketing order. This rule will increase the current tolerance for
individual, whole Deglet Noor dates weighing less than 6.5 grams (the
prescribed minimum) from 10 to 15 percent. The rule will be in effect
through October 31, 1997, and was recommended by the committee.
Section 987.39 of the date marketing order provides authority for
the establishment of minimum quality requirements for varieties of
California dates to be handled in designated outlets. Section 987.40 of
the order also provides authority for the committee to recommend to the
Secretary additional grade or size requirements for any variety of
dates to be handled in any designated outlet when it deems advisable.
Pursuant to Sec. 987.12, there are four designated outlet categories
for California dates--``DAC'' dates, ``dates for further processing''
(FP dates), ``export'' dates, and ``product'' dates.
Section 987.112a of the order's administrative rules prescribes
grade, size, and container requirements for each of the four outlet
categories of dates. Paragraph (b)(2) of that section prescribes such
requirements for DAC dates. DAC dates are marketable whole or pitted
dates that are inspected and certified as meeting the grade, size,
container, and applicable identification requirements for handling in
the United States and Canada. Currently, DAC dates must meet the
requirements for U.S. Grade B, as specified in the U.S. Standards for
Grades of Dates (Standards) issued by the Department. In addition, with
respect to whole dates of the Deglet Noor variety, the individual dates
in a sample from a lot must weigh at least 6.5 grams, with a tolerance
of 10 percent per lot for dates weighing less than 6.5 grams.
Paragraph (c)(2) of Sec. 987.112a provides similar requirements for
FP dates. FP dates are marketable whole dates acquired by one handler
from another handler that are certified as meeting the same grade and
size requirements as for DAC dates, with the exception of moisture
requirements and applicable identification requirements. Currently, FP
dates must also meet the requirements for U.S. Grade B as specified in
the Standards, except for moisture.
Section 987.112a also specifies requirements for the remaining two
outlet categories of dates--export and product. Except for some minor
differences stated in the section, export and product dates must meet
the requirements for U.S. Grade C as specified in the Standards.
At its meeting on October 31, 1996, the committee recommended
increasing the current tolerance for individual, whole Deglet Noor
dates weighing less than 6.5 grams from 10 to 15 percent to be handled
in the DAC and FP outlet categories. The committee also recommended
that this relaxation be in effect through October 31, 1997. This will
allow the rule to be in effect for the remainder of the 1996-97 season,
which ends on September 30, plus an additional month. By the end of
October 1997, as prescribed under the order, the committee is required
to meet and review its marketing policy for the next season. Five
committee members voted for this change, three voted against, and one
abstained.
In its deliberations, the committee commented that the average
fruit size for the 1996-97 crop is expected to be much smaller this
season than in recent years, primarily due to the hot, dry spring.
Increasing the tolerance from 10 to 15 percent for dates weighing less
than 6.5 grams should allow a greater quantity of Deglet Noor dates
which are of good quality but weigh less than 6.5 grams to meet the
requirements for DAC and FP dates. Currently, the industry average of
the number of dates packed per pound is 60. The additional five percent
tolerance for undersize dates will allow handlers to include
approximately two additional smaller dates per pound. Thus, more of the
crop would be utilized as whole dates domestically and in Canada. The
committee estimates total 1996-97 marketable date shipments at 33.5
million pounds. Of that amount, Deglet Noor shipments are estimated at
approximately 32.4 million pounds, with about 15 million pounds likely
to meet the current requirements for DAC and FP dates. According to the
committee, increasing the tolerance from 10 to 15 percent should allow
about three to five percent more Deglet Noor dates to meet the DAC and
FP requirements, or between 450,000 and 750,000 pounds. Making more
Deglet Noor dates of satisfactory quality available for sale
domestically and in Canada should provide for maximum utilization of
the 1996-97 crop, thereby benefiting producers, handlers, and
consumers.
The three committee members who opposed the recommendation believe
[[Page 7662]]
that the overall quality of dates packed will be decreased if smaller
fruit is allowed to meet the requirements for DAC and FP dates.
However, other committee members commented that the smaller size dates
will still have to meet all of the other characteristics DAC and FP
dates must already meet. Thus, consumers should continue to receive
good quality whole dates with only a slight increase in the number of
smaller size dates. In addition, the majority of committee members
believe that this change will only affect about three to five percent
of the Deglet Noor shipments that are expected to meet DAC and FP
requirements.
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 final 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.
There are approximately 15 handlers of California dates who are
subject to regulation under the marketing order and approximately 135
date producers in the regulated area. Small agricultural service firms
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 having annual receipts of
less than $500,000.
Last year, as a percentage, about 75 percent of the handlers
shipped under 4 million pounds of dates and 25 percent shipped over 4
million. Using an average f.o.b. price of $1.12 per pound, about 75
percent of date handlers could be considered small businesses under
SBA's definition and about 25 percent of the handlers could be
considered large businesses. The majority of handlers and producers of
California dates may be classified as small entities.
This final rule revises the size requirements currently prescribed
for the Deglet Noor variety of dates under Sec. 987.112a of the
California date marketing order. Deglet Noor dates from the 1996-97
crop are smaller in size and weight than normal, due to extremely high
temperatures experienced last spring in the production area. The
committee recommended increasing the current tolerance for individual,
whole Deglet Noor dates weighing less than 6.5 grams (the prescribed
minimum) from 10 to 15 percent, to make a larger quantity of the 1996-
97 crop available for sale domestically and in Canada, thereby
benefitting producers, handlers, and consumers. This rule will be in
effect through October 31, 1997.
At the meeting, the committee discussed the impact of this change
on handlers and producers in terms of cost. Handlers and producers
receive higher returns for dates that meet DAC and FP requirements. As
previously mentioned, dates sold as DAC or FP must meet the
requirements for U.S. Grade B dates (with the exception of moisture for
FP dates) as specified in the Standards and dates sold in other outlet
categories such as product and export must meet requirements specified
for U.S. Grade C dates. According to industry members, handlers receive
about $.50 per pound more for U.S. Grade B dates than U.S. Grade C, and
growers receive about $.30 more per pound more for U.S. Grade B dates.
In addition, as previously mentioned, 1996-97 marketable Deglet
Noor shipments are estimated to be approximately 32.4 million pounds,
of which about 15 million pounds should meet DAC and FP requirements.
If, as the committee anticipates, increasing the tolerance for smaller
size fruit will impact about three to five percent of the crop, this
change should allow between about 450,000 and 750,000 pounds more
Deglet Noor dates to be sold as DAC and FP dates. With a net increase
to handlers and producers of about $.50 per pound and $.30 per pound,
respectively, for U.S. Grade B dates, this change could mean an
increase in total net returns of $225,000-$375,000 for all handlers and
$135,000-$225,000 for all producers. The benefits for this rule are not
expected to be disproportionately greater or less for small handlers or
producers than for larger entities.
The committee discussed alternatives to this change, including not
increasing the tolerance at all, as well as increasing the tolerance by
10 percent rather than five percent. While only a small amount of the
crop is expected to be affected by increasing the tolerance, the
committee believes that an increase should benefit producers and
handlers with smaller fruit this season. The committee considered
increasing the tolerance from 10 to 20 percent but believed that this
could put too much smaller size fruit on the market. In addition,
committee members commented that the tolerance was increased by five
percent during the 1992-93 season and in prior seasons because of
similar problems of an abundance of small size fruit due to hot
temperatures, and that the five percent increase was satisfactory.
Thus, the majority of committee members agreed that the tolerance for
the size of Deglet Noor dates should be increased from 10 to 15 percent
through October 31, 1997.
This final rule will relax size requirements under the date
marketing order. Accordingly, this action will not impose any
additional reporting or recordkeeping requirements on either small or
large date handlers. As with all Federal marketing order programs,
reports and forms are periodically reviewed to reduce information
requirements and duplication by industry and public sector agencies.
As noted in the initial regulatory flexibility analysis, the
Department has not identified any relevant Federal rules that
duplicate, overlap or conflict with this final rule. However, as
previously stated, DAC and FP dates must meet the requirements for U.S.
Grade B, as specified in the U.S. Standards for Grades of Dates (7 CFR
52.1001 through 52.1011) issued under the Agricultural Marketing Act of
1946 (7 U.S.C. 1621 through 1627). Standards issued under the
Agricultural Marketing Agreement Act of 1946 are voluntary. Further,
the public comments received concerning the proposal did not address
the initial regulatory flexibility analysis.
In addition, the committee's meeting was widely publicized
throughout the date industry and all interested persons were invited to
attend the meeting and participate in committee deliberations on all
issues. Like all committee meetings, the October 31, 1996, meeting was
a public meeting and all entities, both large and small, were able to
express views on this issue. The committee itself is composed of nine
members, of which six are handlers/producers and three are producers
only, the majority of whom are small entities.
A proposed rule concerning this action was issued by the Department
on December 2, 1996, put on public display at the Office of the Federal
Register on December 5, 1996, and published in the Federal Register on
Friday, December 6, 1996 (61 FR 64638). Copies of the rule were made
available to industry members on December 5, 1996, at a meeting of the
California Date Commission (Commission), a State organization that
conducts promotional activities for the date industry. Many of the
committee members also sit on the Commission. Copies of the rule were
also mailed or sent via facsimile to all committee members and date
handlers.
[[Page 7663]]
Finally, the rule was made available through the Internet by the Office
of the Federal Register.
A 15-day comment period was provided to allow interested persons to
respond to the proposal. Fifteen days was deemed appropriate because a
rule finalizing the action would need to be in place as soon as
possible since handlers are already shipping dates from the 1996-97
crop.
Two comments were received during the comment period in response to
the proposal. The commenters, both representing the same producer
operation, opposed the proposed relaxation. The points made by the
commenters were thoroughly discussed prior to the committee vote.
The commenters disagreed with the statement in the proposed rule
that the relaxation would benefit both producers and handlers. They
claimed that the increased returns to the handlers would not be passed
down to the producers. While this may differ between and among
individual handlers and producers, it is the Department's understanding
that growers are paid for their dates by handlers either on a weight
basis (so much money per pound of dates delivered) or on a packout
basis (so much money per pound of U.S. Grade B or U.S. Grade C dates).
Committee members indicated at the meeting that, when growers are paid
based on packout, such growers receive about $.30 more per pound for
U.S. Grade B dates than U.S. Grade C dates. As previously mentioned,
the committee anticipates that increasing the tolerance for smaller
size fruit will allow more dates to meet U.S. Grade B and be sold as
DAC and FP dates and thus, will benefit handlers and producers in the
industry.
The commenters also contend that the proposed relaxation will lower
industry quality standards at a time when the industry should be
striving for higher standards. However, as discussed by the committee
and specified in the proposed rule, the 5 percent increase in the
number of smaller size dates should result in an average of only 2
additional smaller sized dates in each package of approximately 60
dates. The majority of the committee members felt such a relaxation
would not significantly affect the overall quality of each date
package.
One commenter claimed that the estimate of 450,000 to 750,000
pounds of additional dates made available by the proposed rule is not
accurate because the industry's carryin inventory was 14 million
pounds. While the total inventory is, indeed, estimated at 14.7 million
pounds, the inventory of DAC dates--those dates affected by the
relaxation--is only 5.7 million pounds, which is less than normal. The
committee's estimate of an additional 450,000 to 750,000 pounds of DAC
dates is accurate.
The commenter also suggested that smaller dates would not
necessarily come only from the 1996 crop. The commenter stated that the
rule's expiration date of October 31, 1997, overlaps the 1997 crop
harvest. The commenter contends that smaller dates from the 1997 crop
could be packed with the 1996 crop. However, harvest usually begins in
mid to late October and only a small amount of dates are harvested and
processed before the end of the month. Also, it is common industry
practice to store dates for up to 10 months prior to processing,
packaging and shipment. Therefore, the October 1997 time period would
allow stored 1996 crop dates to be used.
The commenter also claimed that the relaxation is a short term
solution and questioned whether other commodities lower quality
standards because of adverse weather conditions. Such action has been
recommended by other marketing order committees and approved by the
Secretary for some commodities. Such recommendations have helped
marketing order industries to fully utilize available production when
harvests are diminished by adverse weather or other disasters.
Accordingly, no changes will be made to the rule as proposed, based
on the comments received.
After consideration of all relevant matter presented, including the
information and recommendation submitted by the committee and other
available information, it is hereby found that this rule, as
hereinafter set forth, will tend to effectuate the declared policy of
the Act.
It is further found that good cause exists for not postponing the
effective date of this rule until 30 days after publication in the
Federal Register (5 U.S.C. 553) because handlers are already shipping
dates from the 1996-97 crop and handlers want to take advantage of the
relaxation as soon as possible. Further, handlers are aware of this
rule, which was recommended at a public meeting. Also, a 15-day comment
period was provided for in the proposed rule.
List of Subjects in 7 CFR Part 987
Dates, Marketing agreements, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, 7 CFR part 987 is
amended as follows:
1. The authority citation for 7 CFR part 987 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
PART 987--DOMESTIC DATES PRODUCED OR PACKED IN RIVERSIDE COUNTY,
CALIFORNIA
Sec. 987.112a [Amended]
2. In Sec. 987.112a, paragraphs (b)(2) and (c)(2), the words
``December 29, 1992, and ending October 31, 1993,'' are removed and the
words ``February 21, 1997, and ending October 31, 1997,'' are added in
their place.
Dated: February 14, 1997.
Robert C. Keeney,
Director, Fruit and Vegetable Division.
[FR Doc. 97-4335 Filed 2-18-97; 2:02 pm]
BILLING CODE 3410-02-P
