[Federal Register Volume 59, Number 167 (Tuesday, August 30, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-21351]


[[Page Unknown]]

[Federal Register: August 30, 1994]


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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service

7 CFR Part 997

[Docket No. FV94-997-2IFR]

 

Clarifying and Updating Provisions Regulating the Quality of 
Domestically Produced Peanuts Handled by Persons Not Subject to the 
Peanut Marketing Agreement

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

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SUMMARY: This interim rule clarifies that peanut handlers not signatory 
to Peanut Marketing Agreement No. 146 (Agreement) may store and shell 
certain Segregation 2 seed peanut lots with Segregation 1 seed peanut 
lots when such lots are produced under the auspices of a State agency 
which regulates or controls their production. This interim rule also 
updates information on the laboratories qualified to perform aflatoxin 
testing of shelled peanuts. Allowing peanut handlers to commingle 
certain seed peanut lots reduces the space and costs needed to store 
seed peanuts. Updating laboratory information should assist handlers in 
moving peanuts to market. These changes are intended to bring the non-
signatory handling requirements into conformity with those specified in 
the Agreement.

DATES: This interim final rule is effective August 30, 1994. Comments 
received by September 29, 1994 will be considered prior to finalization 
of the rule.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent in triplicate to the Docket 
Clerk, Fruit and Vegetable Division, AMS, USDA, P.O. Box 96456, Room 
2523-S, Washington, D.C., 20090-6456, or Fax: (202) 720-5698. Comments 
should reference the docket number and the date and page number of this 
issue of the Federal Register and will be available for public 
inspection in the Office of the Docket Clerk during regular business 
hours.

FOR FURTHER INFORMATION CONTACT: Richard Lower, Marketing Order 
Administration Branch, Fruit and Vegetable Division, AMS, USDA, P.O. 
Box 96456, Room 2523-S, Washington, D.C. 20090-6456, telephone (202) 
720-2020, facsimile (202) 720-5698.

SUPPLEMENTARY INFORMATION: This interim rule is issued pursuant to 
requirements of 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. This interim final rule will not preempt any State or 
local laws, regulations, or policies, unless they present an 
irreconcilable conflict with this rule. This action is not intended to 
have retroactive effect. There are no administrative procedures which 
must be exhausted prior to any judicial challenge to the provisions of 
this rule.
    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Administrator of the Agricultural Marketing Service 
(AMS) has considered the economic impact of this rule 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.
    There are approximately 45 handlers of peanuts who have not signed 
the Agreement who are subject to the regulations contained herein. 
Small agricultural service firms are defined by the Small Business 
Administration [13 CFR 121.601] as those whose annual receipts are less 
than $5,000,000. It is estimated that most of the handlers are small 
entities. Most producers doing business with these handlers are also 
small entities. Small agricultural producers have been defined as those 
having annual receipts of less than $500,000.
    In 1993, the reported U.S. production, mostly covered under the 
Agreement, was approximately 3.33 billion pounds of peanuts, a 22 
percent decrease from 1992 and the lowest level since 1983. The 
preliminary 1993 peanut crop value is $991.65 million, 77 percent of 
the 1992 crop value.
    After aflatoxin was found in peanuts in the mid-1960's, the 
domestic peanut industry has sought to minimize aflatoxin contamination 
in peanuts and peanut products. Under authority of the Act, Peanut 
Marketing Agreement No. 146 and the Peanut Administrative Committee 
(Committee) were established by the Secretary in 1965. The Agreement 
was signed by a majority of domestic peanut handlers.
    Public Law 101-220, enacted December 12, 1989, amended section 
608(b) of the Act to require that all peanuts handled by persons who 
have not entered into the Agreement (non-signers) be subject to quality 
and inspection requirements to the same extent and manner as are 
required under the Agreement. It is estimated that 5 percent of the 
domestic peanut crop is marketed by non-signatory handlers and the 
remainder of the crop is handled by signatory handlers.
    Under the non-signer provisions, no peanuts may be sold or 
otherwise disposed of for human consumption if the peanuts fail to meet 
the quality requirements of the Agreement. Regulations to implement 
Pub. L. 101-220 were issued and made effective on December 4, 1990 [55 
FR 49980] and amended several times thereafter, and are published in 7 
CFR Part 997. All such amendments were made to ensure that the non-
signer handling requirements remain consistent with modifications to 
the handling requirements applied to signatory handlers under the 
Agreement. Violation of those regulations may result in a penalty in 
the form of an assessment by the Secretary equal to 140 percent of the 
support price for quota peanuts. The support price for quota peanuts is 
determined under section 108B of the Agricultural Act of 1949 (7 U.S.C. 
1445c-3) for the crop year during which the violation occurs.
    The intent of P.L. 101-220 and the objective of the Agreement is to 
insure that only wholesome peanuts of good quality enter edible market 
channels. Under the non-signer and Agreement regulatory provisions, 
farmers' stock peanuts with visible Aspergillus flavus mold (the 
principal source of aflatoxin) are required to be diverted to non-
edible uses. Each lot of shelled peanuts and certain lots of inshell 
peanuts, destined for edible channels, must be officially sampled and 
chemically tested for aflatoxin by the Department or in other 
laboratories listed in the regulations. Inspection and chemical 
analysis programs are administered by the Department.
    Under the non-signer provisions, the second sentence of paragraph 
(e) Seed peanuts prohibits the commingling of Segregation 2 seed lots 
with Segregation 1 peanut lots intended for human consumption. The 
difference between Segregation 1 and Segregation 2 lots is that 
Segregation 1 lots may contain no more than 2 percent damaged kernels 
and no more than 1 percent concealed damaged kernels, while Segregation 
2 lots may contain more than 2 percent damaged kernels and 1 percent 
concealed damaged kernels. Both Segregation 1 lots and Segregation 2 
lots must be free of visible Aspergillus flavus.
    This interim rule clarifies the handling provisions in paragraph 
(e) of Sec. 997.20 Incoming regulation to allow Segregation 2 seed 
peanut lots containing up to 3 percent total damaged kernels to be 
stored, shelled and commingled with Segregation 1 seed peanut lots if 
both lots were produced under the auspices of a State peanut agency 
which regulates or controls the production of the lots being 
commingled.
    The Committee meets in February or March each year and recommends 
to the Secretary such rules and regulations as may be necessary to keep 
the Agreement consistent with current industry practice. The Committee 
met on March 16, 1994, and unanimously recommended clarification of 
seed peanut handling regulations under the Agreement. Members of the 
Committee noted the impracticality of having separate storage bins for 
each of the various types and varieties of seed peanuts with up to 3 
percent damage. It was noted that, if Segregation 2 seed lots with up 
to 3 percent damaged must be stored separate from Segregation 1 seed 
lots, ``foundation,'' ``registered,'' and ``certified'' seed lots would 
have to be segregated into separate categories. This could increase the 
number of separate bins and space needed to store seed peanut lots. The 
current regulations for both signers and non-signers do not 
specifically address commingling Segregation 1 seed lots with 
Segregation 2 seed lots.
    The Committee concluded that it is impracticable to require such 
Segregation 2 seed peanuts be stored and shelled separate from 
Segregation 1 seed peanuts. The Department has initiated rulemaking to 
implement such a clarification in handling requirements applied on 
signatory handlers.
    This interim rule revises Sec. 997.20(e) for non-signer seed 
peanuts and is intended to bring the non-signatory handling 
requirements into conformity with those specified in the Agreement. 
This rule clarifies handling requirements and will facilitate the 
movement of peanuts to market.
    This rule will have no affect on the outgoing quality regulation of 
the non-signer provisions. The quality and handling requirements, as 
specified in Sec. 997.30 Outgoing regulations applicable to non-
signatory 1993-94 crop peanuts, continues to be effective for 1994-95 
crop peanuts.
    This interim rule also updates addresses and facsimile numbers, 
where applicable, of approved aflatoxin testing laboratories that 
perform chemical analyses required by the non-signatory handling 
regulations. This information is provided in paragraph (c)(5)(i) of 
Sec. 997.30 Outgoing regulations. Non-signatory handlers may send 
peanut samples to any laboratory on the list, per instructions 
specified in paragraph (c) of the outgoing regulation. This rule also 
updates information in paragraph (c)(5)(ii) identifying the contact 
point of the USDA Science Division headquarter's office.
    Based on available information, the Administrator of the AMS has 
determined that the issuance of this interim final rule will not have a 
significant economic impact on a substantial number of small entities.
    After consideration of all available information, it is found that 
this action will tend to effectuate the declared policy of the Act.
    Pursuant to 5 U.S.C. 553, it is also found and determined, upon 
good cause, that it is impractical, unnecessary and contrary to the 
public interest to give preliminary notice prior to putting this rule 
into effect, and that good cause exists for not postponing the 
effective date of this action until 30 days after publication in the 
Federal Register because: (1) This action merely clarifies restrictions 
on peanut handlers not subject to the Agreement; (2) the new crop year 
begins on July 1, 1994, and handlers need to know the regulations 
applicable to handling the 1994 and subsequent crop year peanuts as 
soon as possible; (3) this action brings the quality requirements under 
Part 997 into conformity with those under the Agreement, as required by 
the Act; and (4) this action provides a 30-day comment period, and any 
comments received will be considered prior to finalization of this 
rule.

List of Subjects in 7 CFR Part 997

    Food grades and standards, Peanuts, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR Part 997 is 
amended as follows:

PART 997--PROVISIONS REGULATING THE QUALITY OF DOMESTICALLY 
PRODUCED PEANUTS HANDLED BY PERSONS NOT SUBJECT TO THE PEANUT 
MARKETING AGREEMENT

    1. The authority citation for 7 CFR Part 997 continues to read as 
follows:

    Authority: 7 U.S.C. 601-674.

    2. In Sec. 997.20, paragraph (e) is amended by removing the second 
sentence and adding in its place the words: ``Peanuts intended for seed 
use, produced under the auspices of a State agency which regulates or 
controls the production of seed peanuts, which do not meet Segregation 
1 requirements shall be stored and shelled separate from peanuts 
intended for human consumption. However, Segregation 2 seed peanuts, 
produced under the auspices of the State agency, which contain up to 3 
percent damaged kernels and are free from visible Aspergillus flavus 
may be stored and shelled with Segregation 1 seed peanuts which are 
also produced under the auspices of the State agency.''
    3. In Sec. 997.30, paragraphs (c)(5) (i) and (ii) are revised to 
read as follows:


Sec. 997.30   Outgoing regulation.

* * * * *
    (c) * * *
    (5) * * *
    (i) Laboratories at the following locations are approved to perform 
the chemical analyses required pursuant to this part. The sampling plan 
and procedures may be obtained from the Division.

USDA, AMS, Science Division, 1211 Schley Avenue, Albany, Georgia 31707, 
Tel: (912) 430-8490, Fax: (912) 430-8534
USDA, AMS, Science Division, c/o Golden Peanut Company, 200 W. 
Washington Street (Mail: P.O. Box 488), Ashburn, Georgia 31714, Tel: 
(912) 567-3703
USDA, AMS, Science Division, c/o Golden Peanut Company, 301 W. Pearl 
Street (Mail: P.O. Box 279), Aulander, North Carolina 27805, Tel: (919) 
345-1661, ext. 156
USDA, AMS, Science Division, 610 North Main Street, Blakely, Georgia 
31723, Tel: (912) 723-4570, Fax: (912) 723-7294
USDA, AMS, Science Division, c/o Golden Peanut Company, 42 North Ellis 
Street (Mail: P.O. Box 548), Camilla, Georgia 31730, Tel: (912) 336-
0785, ext. 236
USDA, AMS, Science Division, c/o Stevens Industries, Cargill, Inc., 715 
North Main Street (Mail: P.O. Box 272), Dawson, Georgia 31742, Tel: 
(912) 995-2111, ext. 257
USDA, AMS, Science Division, 107 S. Fourth Street, Madill, Oklahoma 
73446, Tel: (405) 795-5615, Fax: (405) 795-3645
USDA, AMS, Science Division, 1411 Reeves Street (Mail: P.O. Box 1368), 
Dothan, Alabama 36302, Tel: (205) 794-5070, Fax: (205) 792-5185
USDA, AMS, Science Division, 308 Culloden Street (Mail: P.O. Box 1130), 
Suffolk, Virginia 23434, Tel: (804) 925-2286, Fax: (804) 925-2275
Pert Laboratories, P.O. Box 267, Peanut Drive, Edenton, North Carolina 
27932, Tel: 919/482-4456
J. Leek Associates, P.O. Box 368, Colquitt, Georgia 27932, Tel: 912/
758-3722
ABC Research, 3437 SW 24th Avenue, Gainesville, Florida 32607-4502, 
Tel: 904/372-0436
J. Leek Associates, 502 West Navarro Street, DeLeon, Texas 76444, Tel: 
817/893-3640
Professional Service Ind., Inc., 3 Burwood Lane, San Antonio, Texas 
78216, Tel: 210/349-5242

    (ii) Handlers should contact the nearest laboratory from the list 
in paragraph (c)(5)(i) of this section to arrange to have samples 
chemically analyzed for aflatoxin content, or for further information 
concerning the chemical analyses required pursuant to this part 
handlers may contact: William J. Franks Jr., Director, Science 
Division, Agricultural Marketing Service, USDA, P.O. Box 96456, Room 
3507-So, Washington, DC, 20090-6456, telephone (202) 720-5231, 
facsimile (202) 720-6496.

    Dated: August 22, 1994.
Robert C. Keeney,
Director, Fruit and Vegetable Division.
[FR Doc. 94-21351 Filed 8-29-94; 8:45 am]
BILLING CODE 3410-02-P