[Federal Register Volume 59, Number 83 (Monday, May 2, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-10218]


[[Page Unknown]]

[Federal Register: May 2, 1994]


Commodity Credit Corporation

7 CFR Part 1468

RIN 0560-AD19

 

Support Prices for Shorn Wool, Wool on Unshorn Lambs, and Mohair 
for the 1994 Marketing Year

AGENCY: Commodity Credit Corporation, USDA.

ACTION: Proposed rule.

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SUMMARY: The National Wool Act of 1954, as amended (Wool Act), requires 
the Secretary of Agriculture (Secretary), through the Commodity Credit 
Corporation (CCC), to make loans and payments available to producers of 
wool and mohair through December 31, 1995. The Wool Act further 
provides that, in the case of the 1994 and 1995 marketing years, the 
payments shall be 75 percent and 50 percent, respectively, of the 
amount otherwise determined in accordance with section 704(a) of the 
Wool Act. This proposed rule would amend the regulations to set forth 
the support levels for shorn wool, wool on unshorn lambs, and mohair 
for the 1994 marketing year.

DATES: Comments must be received on or before June 1, 1994, in order to 
be assured of consideration.

ADDRESSES: Comments must be mailed to Director, Fibers and Rice 
Analysis Division (FRAD), Agricultural Stabilization and Conservation 
Service (ASCS), U.S. Department of Agriculture (USDA), room 3760-S, PO 
Box 2415, Washington, DC 20013-2415.

FOR FURTHER INFORMATION CONTACT: Janise A. Zygmont, FRAD, ASCS, USDA, 
room 3756-S, PO Box 2415, Washington, DC 20013-2415 or call 202-720-
6734.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    This proposed rule is issued in conformance with Executive Order 
12866. Based on information compiled by USDA, it has been determined 
that this proposed rule:
    (1) Would have an annual effect on the economy of more 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 materially 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.

Regulatory Flexibility Act

    It has been determined that the Regulatory Flexibility Act is not 
applicable to this proposed rule since the 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 these 
determinations.

Environmental Evaluation

    It has been determined by an environmental evaluation that this 
action will not have a significant impact on the quality of the human 
environment. Therefore, neither an Environmental Assessment nor an 
Environmental Impact Statement is needed.

Federal Assistance Program

    The title and number of the Federal Assistance Program, as found in 
the Catalog of Federal Domestic Assistance, to which this rule applies 
are: National Wool Act Payments--10.059.

Executive Order 12778

    This proposed rule has been reviewed in accordance with Executive 
Order 12778. The provisions of the proposed rule do not preempt State 
laws, are not retroactive, and do not involve administrative appeals.

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 notice related to 7 CFR part 3015, subpart V, 
published at 48 FR 29115 (June 24, 1983).

Paperwork Reduction Act

    The amendments to 7 CFR part 1468 set forth in this proposed rule 
will not result in any change in the public reporting burden. 
Therefore, the information collection requirements of the Paperwork 
Reduction Act are not applicable to this amendment.

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.

Comments

    Comments are requested with respect to this proposed rule and such 
comments shall be considered in developing the final rule.

Background

    Section 703(a) of the Wool Act provides that the Secretary shall, 
through the CCC, make loans and payments available to producers of wool 
and mohair through December 31, 1995. Proposed regulations concerning a 
recourse loan program will be issued in the near future.
    Section 703(b) of the Wool Act provides that the support price for 
shorn wool for each of the marketing years 1991 through 1995 shall be 
77.5 percent of an amount which is determined by multiplying 62 cents 
(the support price in 1965) by the ratio of: (i) The average of the 
parity index (the index of prices paid by farmers, including 
commodities and services, interest, taxes, and farm wage rates) for the 
three calendar years immediately preceding the calendar year in which 
such support price is being determined and announced to (ii) the 
average parity index for the three calendar years 1958, 1959, and 1960, 
rounding the result to the nearest full cent.
    Based on current reported parity indices, the calculation for the 
1994 shorn wool support price (grease basis) is as follows:

(1) Average parity index, calendar years 1990-1992:
    1990-1267
    1991-1298
    1992-1317
         ________
         -3882 divided by 3
1294.0
(2) Average parity index, 1958-1960
297.3
(3) Ratio of 1294.0 to 297.3
4.3525
(4) 4.3525 x 62 cents/lb. (1965 support price)
$2.6986
(5) 77.5% x $2.6986
$2.0914
(6) $2.0914 rounded to nearest cent
$2.09

    Section 703(c) of the Wool Act provides that the support prices for 
pulled wool and for mohair shall be established at such levels, in 
relationship to the support price for shorn wool, which is determined 
to maintain normal marketing practices for pulled wool, and which is 
determined necessary to maintain approximately the same percentage of 
parity for mohair as for shorn wool. Section 703(c) further provides 
that the support price for mohair must be within a range of 15 per 
centum above or below the comparable percentage of parity at which 
shorn wool is supported.
    Section 704(a) provides that payments shall be such as the 
Secretary determines to be sufficient, when added to the national 
average price received by producers, to give producers a national 
average return for the commodity equal to the support price level, and 
that, in the case of the 1994 and 1995 marketing years, the payments 
shall be 75 and 50 percent, respectively, of the amount otherwise 
determined in accordance with such section.
    Section 703(e) of the Wool Act provides that, to the extent 
practicable, support price levels for wool and mohair shall be 
established and announced sufficiently in advance of each marketing 
year, as will permit producers to plan their production for such 
marketing year. Accordingly, the following methods for calculating the 
support prices for wool on unshorn lambs and for mohair for the 1994 
marketing year are being proposed.
    A. Support Price--Wool on Unshorn Lambs. The support price for wool 
on unshorn lambs for the 1994 marketing year cannot be determined until 
the 1994 national average market price for shorn wool is calculated. 
This will occur by April 1995. It is proposed that the method for 
calculating the support price for wool on unshorn lambs shall be as 
follows: Once the 1994 national average market price for shorn wool is 
determined, the support price for wool on unshorn lambs will be 
determined by taking 80 percent of the difference between the 1994 
support price for shorn wool and the 1994 national average market price 
for shorn wool, multiplied by 5 pounds (the average grease wool yield 
per hundredweight of live, unshorn lambs marketed). Historically, this 
formula has provided equitable support for wool on unshorn lambs 
relative to shorn wool and has helped to maintain normal marketing 
practices for pulled wool. In accordance with section 704(a) of the 
Wool Act, the 1994 marketing year payment for wool on unshorn lambs 
shall be 75 percent of the amount otherwise determined in accordance 
with such formula.
    B. Support Price--Mohair. It is proposed that the support price for 
mohair for the 1994 marketing year shall be determined based on the 
October 1993 parity prices for mohair and shorn wool. The following 
percentages of parity at which shorn wool is supported are being 
considered in the final computation of the mohair support price: 85, 
100, and 115 percent.
    The support programs conducted pursuant to the Wool Act are subject 
to the provisions of the Balanced Budget and Deficit Reduction Act of 
1985, as amended. As a result, the proposed program support levels 
announced in this rule may be recalculated to comply with this Act.
    Accordingly, comments are requested with respect to the support 
price calculation methods for wool on unshorn lambs and mohair. The 
final determination will be set forth at 7 CFR part 1468.

List of Subjects in 7 CFR Part 1468

    Assistance grant programs--agriculture, Livestock, Mohair, 
Reporting and recordkeeping requirements, Wool

    .Accordingly, it is proposed that 7 CFR part 1468 be amended as 
follows:

PART 1468--WOOL AND MOHAIR

    1. The authority citation for 7 CFR part 1468 continues to read as 
follows:

    Authority: 7 U.S.C. 1781-1787; 15 U.S.C. 714b and 714c.

    2. Section 1468.4 is amended by revising paragraph (b) to read as 
follows:


Sec. 1468.4  Eligibility for payments.

* * * * *
    (b)(1) The shorn wool support price for the 1991 through 1995 
marketing years shall be 77.5 percent of an amount which is determined 
by multiplying 62 cents (the support price in 1965) by the ratio of:
    (i) The average of the parity index (the index of prices paid by 
farmers, including commodities and services, interest, taxes, and farm 
wage rates) for the three calendar years immediately preceding the 
calendar year in which such support price is being determined and 
announced to
    (ii) The average parity index for the three calendar years 1958, 
1959, and 1960, rounding the result to the nearest full cent. The shorn 
wool support price wool shall be as follows:
    (A) 1991--$1.88 per pound.
    (B) 1992--$1.97 per pound.
    (C) 1993--$2.04 per pound.
    (D) 1994--$2.09 per pound.
    (2) The payment rate for wool on unshorn lambs for the 1991 through 
1995 marketing years shall be 80 percent of the difference between the 
national average price received by producers for shorn wool during a 
specified marketing year and the shorn wool support price multiplied by 
5 (the average grease wool yield per hundredweight of live, unshorn 
lambs marketed). The payment rate for wool on unshorn lambs shall be as 
follows:
    (i) 1991--$5.32 per hundredweight.
    (ii) 1992--$4.92 per hundredweight.
    (iii) 1993--an amount equal to 80 percent of the difference between 
the national average price received by producers for shorn wool for the 
1993 marketing year and the 1993 shorn wool support price, multiplied 
by 5.
    (vi) 1994--an amount equal to 80 percent of the difference between 
the national average price received by producers for shorn wool for the 
1994 marketing year and the 1994 shorn wool support price, multiplied 
by 5.
    (3) The mohair support price for the 1991 through 1995 marketing 
years shall be established at such level, in relationship to the 
support price for shorn wool, which is determined necessary to maintain 
approximately the same percentage of parity for mohair as for shorn 
wool. The mohair support price shall be set within a range of 15 per 
centum above or below the comparable percentage of parity at which 
shorn wool is supported, as determined and announced by CCC. The 
support price for mohair shall be as follows:
    (i) 1991--$4.448 per pound.
    (ii) 1992--$4.613 per pound.
    (iii) 1993--$4.738 per pound.
    (iv) 1994--an amount within a range of 15 per centum above or below 
the comparable percentage of parity at which shorn wool is supported, 
as determined and announced by CCC.
* * * * *
    3. Section 1468.8 is amended by revising paragraphs (a)(1) and (b) 
to read as follows:


Sec. 1468.8  Computation of payment.

    (a)(1) The amount of the shorn wool or shorn mohair support payment 
shall be computed by applying the rate of payment to the net sales 
proceeds for the wool or mohair marketed during the specified marketing 
year, less the assessment due as specified in Sec. 1468.15. In the case 
of the 1994 and 1995 marketing years, the payments shall be 75 percent 
and 50 percent, respectively, of the amount otherwise determined in 
accordance with this part. For shorn wool payments, if there is a 
purchase by the producer of unshorn lambs, the resultant amount shall 
be reduced by an amount resulting from multiplying the liveweight of 
such lambs reported in the application for payment by the calculated 
wool on shorn lambs support for such marketing year. If the amount of 
the reduction exceeds the payment computed on the shorn wool marketed, 
the liveweight of lambs which corresponds to the excess amount shall be 
carried forward and used to reduce payments on unshorn lambs marketed 
or slaughtered or shorn wool marketed in the current or subsequent 
years.
* * * * *
    (b) The amount of the wool support payment due to a producer for 
wool on unshorn lambs shall be computed by applying the rate of payment 
to the liveweight of the lambs sold or moved to slaughter during the 
specified marketing year, reduced, on account of the purchase or 
importation by the producer of unshorn lambs, by the liveweight of such 
lambs reported in the application for payments, less the assessment due 
as specified in Sec. 1468.15. In the case of the 1994 and 1995 
marketing years, the payments shall be 75 percent and 50 percent, 
respectively, of the amount otherwise determined in accordance with 
this part. If the amount of the reduction exceeds the liveweight of the 
unshorn lambs sold or moved to slaughter during said marketing year, 
such excess liveweight shall be carried forward and used to reduce 
payments on the wool on unshorn lambs marketed or slaughtered or shorn 
wool marketed in the current or subsequent years.
* * * * *
    Signed at Washington, DC, on April 22, 1994.
Bruce R. Weber,
Acting Executive Vice President, Commodity Credit Corporation.
[FR Doc. 94-10218 Filed 4-29-94; 8:45 am]
BILLING CODE 3410-05-P