[Federal Register Volume 61, Number 136 (Monday, July 15, 1996)]
[Rules and Regulations]
[Pages 36814-36816]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-17869]
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DEPARTMENT OF AGRICULTURE
7 CFR Part 989
[FV96-989-1FIR]
Raisins Produced From Grapes Grown in California; Final Free and
Reserve Percentages for the 1995-96 Crop Year for Natural (Sun-Dried)
Seedless, Zante Currant, and Other Seedless Raisins
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
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SUMMARY: The Department of Agriculture (Department) is adopting as a
final rule, without change, the provisions of an interim final rule
which established final free and reserve percentages for 1995-96 crop
Natural (sun-dried) Seedless (NS), Zante Currant (ZC), and Other
Seedless (OS) raisins. The percentages are 79 percent free and 21
percent reserve, 70 percent free and 30 percent reserve, and 51 percent
free and 49 percent reserve for NS, ZC, and OS raisins, respectively.
These percentages are intended to stabilize supplies and prices and to
help counter the destabilizing effects of the burdensome oversupply
situation facing the raisin industry. This rule was unanimously
recommended by the Raisin Administrative Committee (Committee), the
body which locally administers the marketing order.
EFFECTIVE DATE: August 14, 1996.
FOR FURTHER INFORMATION CONTACT: Richard P. Van Diest, Marketing
Specialist, California Marketing Field Office, Fruit and Vegetable
Division, AMS, USDA, 2202 Monterey Street, suite 102B, Fresno,
California 93721; telephone: 209-487-5901 or Mark A. Slupek, Marketing
Specialist, Marketing Order Administration Branch, Fruit and Vegetable
Division, AMS, USDA, room 2523-S, P.O. Box 96456, Washington, DC 20090-
6456; telephone: 202-205-2830.
[[Page 36815]]
SUPPLEMENTARY INFORMATION: This final rule is issued under marketing
agreement and Order No. 989 (7 CFR part 989), both as amended,
regulating the handling of raisins produced from grapes 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.''
The Department of Agriculture (Department) is issuing this rule in
conformance with Executive Order 12866.
This rule has been reviewed under Executive Order 12778, Civil
Justice Reform. Under the marketing order provisions now in effect,
final free and reserve percentages may be established for raisins
acquired by handlers during the crop year. This action finalizes final
free and reserve percentages for NS, ZC, and OS raisins for the 1995-96
crop year, beginning August 1, 1995, through July 31, 1996. This final
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 requesting a modification of the order or to be exempt
therefrom. Such 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/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.
An interim final rule was published in the Federal Register on
February 26, 1996 (61 FR 7067), with an effective date of February 26,
1996. That rule established final free and reserve percentages for NS,
ZC, and OS raisins for the 1995-96 crop year. The percentages were
established in a new section 989.249 of the rules and regulations in
effect under the marketing order. That rule provided a 30-day comment
period which ended March 27, 1996. No comments were received.
The order prescribes procedures for computing trade demands and
preliminary and final percentages that establish the amount of raisins
that can be marketed throughout the season. The regulations apply to
all handlers of California raisins. Raisins in the free percentage
category may be shipped immediately to any market, while reserve
raisins must be held by handlers in a reserve pool for the account of
the Committee. Under the order, reserve raisins may be: Sold at a later
date by the Committee to handlers for free use; used in diversion
programs; exported to authorized countries; carried over as a hedge
against a short crop the following year; or disposed of in other
outlets noncompetitive with those for free tonnage raisins.
While this rule continues in effect restrictions limiting the
amount of NS, ZC, and OS raisins that enter domestic markets, final
free and reserve percentages are intended to lessen the impact of the
oversupply situation facing the industry and promote stronger marketing
conditions, thus stabilizing prices and supplies and improving grower
returns. In addition to the quantity of raisins released under the
preliminary percentages and the final percentages, the order specifies
methods to make available additional raisins to handlers by requiring
sales of reserve pool raisins for use as free tonnage raisins under
``10 plus 10'' offers, and authorizing sales of reserve raisins under
certain conditions.
The Department's ``Guidelines for Fruit, Vegetable, and Specialty
Crop Marketing Orders'' specifies that 110 percent of recent years'
sales should be made available to primary markets each season before
recommendations for volume regulation are approved. This goal is met by
the establishment of a final percentage which makes available 100
percent of the computed trade demand and the additional offering of
reserve raisins to handlers under ``10 plus 10'' offers. The ``10 plus
10'' offers are two simultaneous offers of reserve pool raisins which
are made available to handlers each season. For each such offer, a
quantity of raisins equal to 10 percent of the prior year's shipments
is made available for free use. A total of 62,578 tons of NS, 960 tons
of ZC, and 638 tons of OS were purchased by handlers for free use
pursuant to these offers.
Pursuant to section 989.54(a) of the order, the Committee met on
August 15, 1995, to review shipment and inventory data, and other
matters relating to the supplies of raisins of all varietal types. The
Committee computed a trade demand for each varietal type for which a
free tonnage percentage might be recommended. The trade demand is 90
percent of the prior year's shipments of free tonnage and reserve
tonnage raisins sold for free use for each varietal type into all
market outlets, adjusted by subtracting the carryin of each varietal
type on August 1 of the current crop year and by adding to the trade
demand the desirable carryout for each varietal type at the end of that
crop year. As specified in section 989.154, the desirable carryout for
each varietal type shall be equal to the shipments of free tonnage
raisins of the prior crop year during the months of August, September,
and one fourth of October. If the prior year's shipments are limited
because of crop conditions, the total shipments during that period of
time during one of the three years preceding the prior crop year may be
used. In accordance with these provisions, the Committee computed and
announced 1995-96 trade demands of 257,314 tons, 2,208 tons, and 1,047
tons for NS, ZC, and OS raisins, respectively.
As required under section 989.54(b) of the order, the Committee met
on October 3, 1995, and computed and announced preliminary crop
estimates and preliminary free and reserve percentages for NS and ZC
raisins which released 65 percent of the trade demand since the field
prices had not been established, and 85 percent of the trade demand for
OS raisins because the field price had been established. The
preliminary crop estimates and preliminary free and reserve percentages
were as follows: 335,118 tons, 50 percent free, and 50 percent reserve
for NS raisins; 3,696 tons, 39 percent free, and 61 percent reserve for
ZC raisins; and 2,197 tons, 40 percent free, and 60 percent reserve for
OS raisins. The Committee authorized the Committee staff to modify the
preliminary percentages to release 85 percent of the trade demand when
the field prices were established for NS and ZC raisins. The
preliminary percentages for NS and ZC raisins were adjusted soon
thereafter to 65 percent free, 35 percent reserve, and 51 percent free
and 49 percent reserve, respectively.
Also at that meeting, the Committee computed and announced
preliminary crop estimates and preliminary free and reserve percentages
for Dipped Seedless, Oleate and Related Seedless, Golden Seedless,
Sultana, Muscat, and Monukka raisins. It determined that the supplies
of these varietal types would be less than or close enough to the
computed trade demands for each variety, and that volume control
percentages would not be necessary to maintain market stability for
these varietal types.
[[Page 36816]]
On January 12, 1996, the Committee recommended final percentages of
79 percent free, 21 percent reserve for NS raisins; 70 percent free, 30
percent reserve for ZC raisins; and 51 percent free, 49 percent reserve
for OS raisins.
Pursuant to section 989.54(c), the Committee may adopt interim free
and reserve percentages. Interim percentages may release less than the
computed trade demand for each varietal type. The Committee also
computed interim free and reserve percentages at the January 12, 1996,
meeting. Interim percentages were announced as 78.75 percent free,
21.25 percent reserve for NS raisins; 69.75 percent free, 30.25 percent
reserve for ZC raisins; and 50.75 percent free, 49.25 percent reserve
for OS raisins. That action released most, but not all, of the computed
trade demand for NS, ZC, and OS raisins.
Under section 989.54(d) of the order, the Committee is required to
recommend to the Secretary, no later than February 15 of each crop
year, final free and reserve percentages which, when applied to the
final production estimate of a varietal type, will tend to release the
full trade demand for any varietal type.
The Committee's final estimate of 1995-96 production of NS raisins
is 325,808 tons. Dividing the computed trade demand of 257,314 tons by
the final estimate of production results in a final free percentage of
79 percent and a final reserve percentage of 21 percent for NS raisins.
The Committee's final estimate of 1995-96 production of ZC raisins
is 3,158 tons. Dividing the computed trade demand of 2,208 tons by the
final estimate of production results in a final free percentage of 70
percent and a final reserve percentage of 30 percent for ZC raisins.
The Committee's final estimate of 1995-96 production of OS raisins
is 2,048 tons. Dividing the computed trade demand of 1,047 tons by the
final estimate of production results in a final free percentage of 51
percent and a final reserve percentage of 49 percent for OS raisins.
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.
There are approximately 20 handlers of California raisins who are
subject to regulation under the raisin marketing order, and
approximately 4,500 producers in the production area. Small
agricultural service firms have been defined by the Small Business
Administration (13 CFR 121.601) as those whose annual receipts (from
all sources) are less than $5,000,000, and small agricultural producers
are defined as those having annual receipts of less than $500,000. No
more than eight handlers, and a majority of producers, of California
raisins may be classified as small entities. Twelve of the 20 handlers
subject to regulation have annual sales estimated to be at least
$5,000,000, and the remaining eight handlers have sales less than
$5,000,000, excluding receipts from any other sources.
In recent years, the California raisin industry has been faced with
a burdensome oversupply. A major reason for its oversupply problem is
that wineries have not been purchasing as many raisin variety grapes.
Raisin variety grapes which wineries will not buy generally are dried
into raisins. The volume control procedures specified in the order
provide a means of lessening the impact of year-to-year variations in
raisin supplies on producer prices. The percentages contribute toward
orderly marketing and market stability.
The free and reserve percentages established by the interim final
rule, and continued in effect, without change, by this rule, apply
uniformly to all handlers in the industry, whether small or large, and
release the full trade demand. There are no known additional costs
incurred by small handlers that are not incurred by large handlers. As
the season progressed, additional quantities of the trade demand were
released. For some varieties of raisins, no volume control was
implemented.
Although raisin markets are limited, they are available to all
handlers, regardless of size. While the level of benefits of this
action are difficult to quantify, the stabilizing effects of the
percentages impact both small and large handlers positively by helping
them maintain and expand markets even though raisin supplies fluctuate
from season to season. Between the 1989-90 and 1994-95 crop years,
total California raisin shipments increased by three percent, which
benefitted both small and large handlers.
Accordingly, the Agricultural Marketing Service has determined that
the issuance of this final rule will not have a significant economic
impact on a substantial number of small entities in the California
raisin industry.
After consideration of all relevant information presented,
including the Committee's recommendations and other information, it is
found that finalizing the interim final rule, without change, as
published in the Federal Register on February 26, 1996 (61 FR 7067),
will tend to effectuate the declared policy of the Act.
List of Subjects in 7 CFR Part 989
Grapes, Marketing agreements, Raisins, Reporting and recordkeeping
requirements.
PART 989--RAISINS PRODUCED FROM GRAPES GROWN IN CALIFORNIA
Accordingly, the interim final rule amending 7 CFR part 989 which
was published at 61 FR 7067 on February 26, 1996, is adopted as a final
rule without change.
Dated: July 8, 1996.
Robert C. Keeney,
Director, Fruit and Vegetable Division.
[FR Doc. 96-17869 Filed 7-12-96; 8:45 am]
BILLING CODE 3410-02-P
