[Federal Register Volume 59, Number 38 (Friday, February 25, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-4329]


[[Page Unknown]]

[Federal Register: February 25, 1994]


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DEPARTMENT OF AGRICULTURE
Agricultural Stabilization and Conservation Service

7 CFR Part 729

RIN 0560-AD20

 

1994-Crop Peanuts National Poundage Quota

AGENCY: Agricultural Stabilization and Conservation Service, USDA.

ACTION: Final rule.

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SUMMARY: On December 15, 1993, the Secretary of Agriculture (Secretary) 
announced by press release that the national poundage quota for quota 
peanuts was established at 1,350,000 short tons (st), 146,000 st less 
than last year's quota. This final rule codifies the announced quota. 
The quota is established pursuant to statutory requirements contained 
in the Agricultural Adjustment Act of 1938 (the 1938 Act), as amended.

EFFECTIVE DATE: December 15, 1993.

FOR FURTHER INFORMATION CONTACT: Robert Miller, Director, Tobacco and 
Peanuts Analysis Division, Agricultural Stabilization and Conservation 
Service (ASCS), United States Department of Agriculture (USDA), room 
3739, South Building, P.O. Box 2415, Washington, DC 20013-2415, 
telephone 202-720-7477.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    This final rule is issued in conformance with Executive Order 
12866. Based on information compiled by USDA, it has been determined 
that this final rule:
    (1) Would have an annual effect on the economy of less than $100 
million;
    (2) Would not adversely affect in a material way the economy, a 
sector of the economy, productivity, competition, jobs, the 
environment, public health or safety, or State, local, or tribal 
governments or communities;
    (3) Would not create a serious inconsistency or otherwise interfere 
with an action taken or planned by another agency;
    (4) Would not alter the budgetary impact of entitlements, grants, 
user fees, or loan programs or rights and obligations of recipients 
thereof; and
    (5) Would not raise novel legal or policy issues arising out of 
legal mandates, the President's priorities, or principles set forth in 
Executive Order 12866.
    One commentor in response to the proposed quota previously 
published in the Federal Register disagreed with conclusions (1), (2), 
and (3) noting the 1990-crop and the drought that affected that crop. 
These determinations remain unchanged as the quota level adopted by 
this notice is required by statute and involves an on-going Federal 
program.

Final Regulatory Impact Analysis

    A final regulatory impact analysis discussing the impact of the 
established quota is available from the above-named person.

Executive Order 12778

    This final rule has been reviewed in accordance with Executive 
Order 12778, Civil Justice Reform. The provisions of this rule do not 
preempt State laws, are not retroactive, and do not involve 
administrative appeals.

Federal Assistance Program

    The title and number of the Federal Assistance Program, as found in 
the Catalog of Federal Domestic Assistance, to which this final rule 
applies are Commodity Loans and Purchases--10.051.

Executive Order 12372

    This program/activity is not subject to the provisions of Executive 
Order 12372 relating to 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).

Regulatory Flexibility Act

    It has been determined that the Regulatory Flexibility Act is not 
applicable to this final rule because ASCS 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.

Paperwork Reduction Act Requirements

    The amendments to 7 CFR part 729 set forth in this final rule do 
not contain information collection requirements that require clearance 
through the Office of Management and Budget under the provisions of 44 
U.S.C. chapter 35.

Announcement of the Quota

    Section 358-1(a)(1) of the 1938 Act requires that the national 
poundage quota for peanuts for each of the 1991 through 1995 marketing 
years (MY's) be established by the Secretary at a level that is equal 
to the quantity of peanuts (in tons) that the Secretary estimates will 
be devoted in each such MY to domestic edible, seed, and related uses. 
Section 358-1(a)(1) further provides that the national poundage quota 
for a MY shall not be less than 1,350,000 st. The MY for 1994-crop 
peanuts runs from August 1, 1994, through July 31, 1995. Poundage 
quotas for the 1991-95 crops of peanuts were approved by 98.2 percent 
of peanut growers voting in a referendum conducted December 10 through 
13, 1990. A proposed rule on the quota determination, with a public 
comment period, was published in the Federal Register (58 FR 63106) on 
November 30, 1993. The proposed rule of 1,350,000 st set out, for 
purposes of the proposed quota calculation, individual estimates for: 
(1) Domestic food use; (2) farm sales and local sales of peanuts; (3) 
seed use; (4) crushing residual; (5) shrinkage and other losses; and 
(6) Segregation 2 and 3 loan transfers. The sum of the individual 
estimates was 1,298,000 st., less than the allowed statutory minimum of 
1,350,000 st.
    Following a review of the comments and more recent estimates made 
by the USDA Interagency Commodity Estimates Committee (ICEC) for 
Oilseeds, Oils, and Meals, the estimates for domestic edible, seed, and 
related uses totals 1,333,000 st., which is likewise below the allowed 
minimum. Updated data resulted in adjustments to the estimates of 
domestic food use and seed. The adjustments in those two factors also 
produced a slight revision in the estimate for crushing residual. The 
differences between the estimates on which the proposed quota was based 
versus the estimates on which the final quota was established are set 
out in the following table:

            Estimated Domestic Edible, Seed, and Related Uses           
------------------------------------------------------------------------
                                                   Quota (short tons)   
                                               -------------------------
                     Item                       Proposed\1\             
                                                               Final\2\ 
------------------------------------------------------------------------
Domestic edible:                                                        
  Domestic food...............................      986,000    1,019,000
  On farm and local sales.....................       22,000       22,000
                                               -------------------------
      Subtotal................................    1,008,000    1,041,000
Seed..........................................       97,000       98,500
Related Uses:                                                           
  Crushing residual...........................      133,000      133,500
  Shrinkage and other losses..................       40,000       40,000
  Segregation 2 and 3 loan transfers to quota                           
   loan.......................................       20,000       20,000
                                               -------------------------
      Subtotal................................      193,000      193,500
                                               -------------------------
      Total...................................  \3\1,298,00             
                                                          0  \3\1,333,00
                                                                       0
------------------------------------------------------------------------
\1\Contained in November 30, 1993, Federal Register (58 FR 63106).      
\2\ Final quota determination.                                          
\3\By statute, the quota level cannot be less than 1,350,000 st.        

Discussion of the Comments on Proposed Quota

    A total of 7 comments were received during the public comment 
period that ended on December 6, 1993. Comments were submitted by 2 
manufacturer/processor associations, 2 manufacturers, 1 sheller 
association, and 2 grower associations.
    The comments made regarding the 1994-crop national quota are 
discussed below by subject matter.

A. Overall Quota Level

    A number of comments were directed to the overall quota level 
rather than to individual elements of the calculation. The 
manufacturer/processor associations and manufacturers supported larger 
quotas, between 1,403,000 st and 1,645,600 st. The sheller association 
and two grower associations supported the proposed 1994 quota of 
1,350,000 st. One commentor justified a high recommendation by citing 
the 1990-crop year drought when yields were reduced and supplies were 
very tight, but did not cite any figure for needed carryover, if any. 
The current quota formula has applied since 1986 and growers have 
produced on average 128 percent of the national poundage quota 
(counting the production of non-quota, ``additional'' peanuts which 
can, if needed, be used for quota-peanut purposes if certain special 
procedures are followed and certain conditions are met).

B. Domestic Edible Use

    The final estimate of 1994 domestic food use was 3 percent above 
the proposed estimate. It was developed in two steps. First, total 
domestic edible utilization of 1,137,500 st was estimated by the USDA 
ICEC. Second, to account for peanut butter imports and exports, the 
estimate of domestic edible disappearance was reduced by 118,500 st.
    Manufacturer/processor associations and manufacturers requested a 
higher domestic edible food use to enable growth in excess of projected 
levels. A grower association supported the proposed domestic food use 
estimate. Based on the best data available, it was determined that the 
final quota made the most realistic estimates of growth and imports 
possible.
    Accordingly, the revised estimate of domestic edible use was 
accepted.

C. Farm Use and Local Sales

    No comments were received. The proposed estimate of 20,000 st was 
accepted without change.

D. Seed Use

    The proposed seed estimate of 97,000 st was based on the farmer 
stock tonnage equivalent of the amount of seed required to plant the 
expected 1995 crop. A manufacturer believed that processing losses for 
seed peanuts requires a 150,000 st estimate. It was determined that the 
ICEC estimate for the amount of seed required to plant the 1995 crop 
was the most realistic estimate available and a revised ICEC seed 
estimate of 98,500 st was accepted in the final rule.

E. Crushing Residual

    The crushing residual represents the farmer stock equivalent weight 
of crushing grade kernels shelled from quota peanuts. In any given load 
of quota farmer stock peanuts, a portion of such peanuts is only 
suitable for the crushing market. The portion of such peanuts only 
suitable for the crushing market was proposed to be estimated at 12 
percent, unchanged from the level used for setting the 1992 and 1993 
quotas. One manufacturer asserted that recent edible kernel yields 
would require using a higher crushing residual, but this higher yield 
is not considered representative for the industry. It was determined 
accordingly, that the proposed crushing residual factor of 12 percent 
was the most accurate estimate available. That level is within the 
range a sheller association proposed for the 1993 crop. The proposed 
factor of 12 percent was retained.

F. Shrinkage and Other Losses

    No comments were provided and the estimate was accepted as 
proposed.

G. Segregation 2 and 3 Transfers

    No comments were provided and the estimate was accepted as 
proposed. This estimate represents peanuts that would otherwise be 
eligible for use as quota peanuts but which will not qualify for such 
use due to quality problems. Such transfers to quota peanut price 
support loan pools occur when quota peanut producers, due to no fault 
of their own, would otherwise have insufficient Segregation 1 peanuts 
to fulfill their quota. In such instances, Segregation 2 and 3 peanuts 
placed under an additional peanut price support loan may be transferred 
to the quota price support loan. The Commodity Credit Corporation will 
then ensure that such peanuts are crushed for oil.

Proposed Quota Adjustment for Undermarketings and Carryover

    The foregoing components of the national poundage quota have not 
been adjusted for either the application of prior undermarketings to 
the 1994 quota or abnormal carryover stocks at the beginning of MY 
1994. As peanut usage has grown, carryover stocks have also grown. But, 
since 1980, carryover stocks have varied more from year to year than 
earlier. Also, current law allows a farm's quota to be increased by the 
amount by which marketings for prior years back to 1989 were less than 
the farm's quota. The total of all such increases nationally may not 
exceed 10 percent of the national poundage quota. Unapplied 
undermarketings from 1993 suggest that the 1994 quotas at the farm 
level will also be increased by the 10-percent maximum. In response to 
this issue an association of manufacturers favored a 50,000 st quota 
increase to adjust for low carryover stocks from the 1993-94 marketing 
year. Two comments did not favor any MY 1994 quota adjustment for 
undermarketings and carryover.
    Without prejudice to possible adjustments to the 1995-crop and 
subsequent quota determinations, it was determined that the 1994-crop 
quota would not be adjusted to reflect the impact of undermarketings 
and end of year carryover of 1993-crop peanuts into MY 1994 as it was 
determined that a 1,350,000 st quota would be sufficient to meet full 
demand for peanuts in the coming year.
    After consideration of the comments received, the proposed change 
to 7 CFR 729.214 is adopted as presented in the proposed rule.

List of Subjects in 7 CFR Part 729

    Poundage quotas, Peanuts, Reporting and recordkeeping requirements.

    Accordingly, 7 CFR part 729 is amended as follows:

PART 729--PEANUTS

    1. The authority citation for 7 CFR part 729 continues to read as 
follows:

    Authority: 7 U.S.C. 1301, 1357 et seq., 1372, 1373, 1375; 7 
U.S.C. 1445c-3.

    2. Section 729.214 is amended by adding paragraph (d) to read as 
follows:


Sec. 729.214  National poundage quota.

* * * * *
    (d) The national poundage quota for peanuts for marketing year 1994 
is 1,350,000 short tons.

    Signed at Washington, DC, on February 18, 1994.
Bruce R. Weber,
Acting Administrator, Agricultural Stabilization and Conservation 
Service.
[FR Doc. 94-4329 Filed 2-24-94; 8:45 am]
BILLING CODE 3410-05-P