[Federal Register Volume 59, Number 179 (Friday, September 16, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-22922]


[[Page Unknown]]

[Federal Register: September 16, 1994]


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DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation

7 CFR Part 1421

RIN 0560-AD27

 

1994-Crop Peanuts; National Average Support Levels for Quota and 
Additional Peanuts; and Minimum Commodity Credit Corporation Export 
Edible Sale Price for Additional Peanuts

AGENCY: Commodity Credit Corporation, USDA.

ACTION: Final rule.

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SUMMARY: The purpose of this final rule is to codify determinations 
made by the Secretary of Agriculture (Secretary) with respect to the 
1994 peanut crop: The national average support level for quota peanuts 
of $678.36 per short ton (st); the national average support level for 
additional peanuts of $132 per st; and the minimum Commodity Credit 
Corporation (CCC) export edible sale price for additional peanuts of 
$400 per st. The determinations of the national average support levels 
for quota and additional peanuts were made pursuant to the statutory 
requirements of the Agricultural Act of 1949 (the 1949 Act), as amended 
by the Food, Agriculture, Conservation, and Trade Act of 1990. The 
determination of the minimum CCC export edible sale price for 
additional peanuts is a discretionary determination made to facilitate 
the marketing of additional peanut contract negotiations.

EFFECTIVE DATE: February 15, 1994.

FOR FURTHER INFORMATION CONTACT: Kenneth M. Robison, Tobacco and 
Peanuts Analysis Division, Agricultural Stabilization and Conservation 
Service (ASCS), Room 3732, South Building, United States Department of 
Agriculture, 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 
and has been determined to be significant.

Federal Assistance Program

    The title and number of the Federal Assistance Program, as found in 
the catalogue of Federal Domestic Assistance, to which this 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).

Executive Order 12778

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

Regulatory Flexibility Act

    It has been determined that the Regulatory Flexibility Act is not 
applicable because 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 of these determinations.

Information Collection Requirements

    The amendments to 7 CFR part 1421 set forth in this final rule do 
not contain information collections that require clearance by the 
Office of Management and Budget under the provisions of 44 U.S.C. 35.
    This rule is issued pursuant to the provisions of the 1949 Act.
    On February 15, 1994, the Secretary announced the national average 
support levels for 1994-crop quota and additional peanuts and the 
minimum CCC export edible sales price for 1994-crop additional peanuts.
    Section 1017 of The Food Security Act of 1985 provides that the 
Secretary shall determine the rate of loans, payments, and purchases 
for the 1991 through 1995 crops of commodities without regard to the 
requirements for notice and public participation in rulemaking as 
prescribed in 5 U.S.C. 553 or in any directive of the Secretary.

Determinations

A. Quota Peanuts Support Level

    In accordance with section 108B(a)(2) of the 1949 Act, the national 
average price support level for 1994-crop quota peanuts must be the 
corresponding 1993-crop price support level adjusted to reflect any 
increases in the national average cost of peanut production (excluding 
any changes in the cost of land) during the calendar year immediately 
preceding marketing year (MY) 1994, except that the MY 1994 price 
support level cannot exceed the MY 1993 support level by more than 5 
percent. In the event of a reduction in these costs of production, the 
MY 1994 price support level for quota peanuts would be required, under 
the terms of Section 108B, to be unchanged from MY 1993. The MY 1993 
quota peanut price support level is $674.93 per st. The MY 1994 support 
level for quota peanuts was determined based on the following 
estimates:

                   Peanut Cost Escalator Calculations                   
------------------------------------------------------------------------
               Variablecomponent                     1993        1994   
------------------------------------------------------------------------
Total cash expenses (less interest on real                              
 estate), capital replacement, and unpaid                               
 labor\1\.......................................  $488.63/ac            
                                                          re  $492.91/ac
                                                                      re
Trend yields....................................  2,500 lbs./           
                                                        acre  2,500 lbs./
                                                                    acre
Adjusted costs per pound........................   $0.195452   $0.197164
------------------------------------------------------------------------


                      Adjusted Costs Per Short Ton                      
------------------------------------------------------------------------
                          Dollars per short ton                         
-------------------------------------------------------------------------
                           1992                                  1993   
------------------------------------------------------------------------
$390.90....................................................      $394.33
------------------------------------------------------------------------


                         1994 Quota Calculations                        
                        [Dollars per short ton]                         
                                                                        
                                                                        
Change during 1993 in the average cost of producing peanuts..      $3.43
1994 Quota Support Level (1993 Support + escalator)..........   $674.93+
                                                                  $3.43=
                                                                 $678.36
\1\Economic Research Service estimates.                                 
Source: TPAD/ASCS/January 1994.                                         

    As indicated, relevant peanut production costs increased from 
calendar year 1992 to 1993. The MY 1994 quota peanut price support 
level is accordingly established at $678.36 per st, up $3.43 per st 
from MY 1993.

B. Additional Peanut Support Level

    Section 108B(b)(1) of the 1949 Act provides that price support 
shall be made available for additional peanuts at such level as the 
Secretary determines will ensure no losses to CCC from the sale or 
disposal of such peanuts, taking into consideration the demand for 
peanut oil and peanut meal, expected prices of other vegetable oils and 
protein meals, and the demand for peanuts in foreign markets.
    The MY 1994 price support level for additional peanuts is 
established at $132 per st to ensure no losses to CCC from the sale or 
disposal of such peanuts, up $0.91 per st from MY 1992. Peanuts are 
pledged as collateral for price support loans. The peanuts are then 
sold out of inventory in order to recoup the loan principal, interest 
and related costs. The statutory factors have been analyzed as set out 
below. Based on those factors, it is anticipated that while the current 
oil market is unusually strong, there is enough uncertainty in the 
market to suggest caution in setting the floor price for inventory 
peanuts sold for crushing. For that reason, it has been determined that 
the support rate should remain essentially unchanged from the level for 
additional peanuts that was in place for the 1993 crop, that being 
$131.09 per st. However, it was determined to increase the support 
level to reflect a similar percentage increase as applied to the quota 
support level, then rounded to the nearest whole dollar which should 
continue, it has been determined, to be a level which will reasonably 
assure no losses on the sale or disposal of additional peanuts for CCC. 
In making this determination, the following information was considered.
    1. The domestic use of peanut oil during MY 1994 is forecast to be 
117,500 st, up 6.8 percent from MY 1993 projected domestic use. MY 1994 
peanut oil beginning stocks are expected to be 25,000 st, down 50 
percent from MY 1993. The MY 1994 average peanut oil price is expected 
to be $0.35 per pound, down $0.06 per pound from MY 1993.
    2. The domestic use of peanut meal during MY 1994 is forecast to be 
205,000 st, up 44,000 st from MY 1993 projected domestic use. MY 1994 
peanut meal beginning stocks are expected to be 5,000 st, down 1,000 st 
from MY 1993. The MY 1994 average peanut meal price is expected to be 
$155 per st, up $45 per st from MY 1993.
    3. The domestic disappearance of soybean oil during MY 1994 is 
forecast to be 6,525,000 st, up 1.2 percent from projected MY 1993 
domestic disappearance. MY 1994 soybean oil beginning stocks are 
expected to be 462,500 st, down 40.5 percent from MY 1993. The MY 1994 
average soybean oil price is expected to be $0.275 per pound, unchanged 
from MY 1993.
    4. The domestic disappearance of cottonseed oil during MY 1994 is 
forecast to be 530,000 st, unchanged from projected MY 1993 domestic 
disappearance. MY 1994 cottonseed oil beginning stocks are expected to 
be 42,500 st, up 4.9 percent from MY 1993. The MY 1994 average 
cottonseed oil price is expected to be $0.29 per pound, down $0.005 
from MY 1993.
    5. The domestic disappearance of soybean meal during MY 1994 is 
forecast to be 24,500,000 st, up 1.0 percent from projected MY 1993 
domestic disappearance. MY 1994 soybean meal beginning stocks are 
expected to be 300,000 st, up 47 percent from MY 1993. The MY 1994 
average soybean meal price is expected to be $165 per st, down $35 per 
st from MY 1993.
    6. The domestic disappearance of cottonseed meal during MY 1994 is 
forecast to be 1,600,000 st, up 3.9 percent from projected MY 1993 
domestic disappearance. MY 1994 cottonseed meal beginning stocks are 
expected to be 40,000 st, up 37.9 percent from MY 1993. The average 
cottonseed meal price for MY 1994 is expected to be $130 per st, down 
$35 per st from MY 1993.
    7. The world use of peanuts for MY 1993 is expected to be 23.03 
million metric tons, down 0.1 percent from MY 1992. World peanut 
production for MY 1993 is forecast to be 22.74 million metric tons, 
down 1.5 percent from MY 1992. Ending stocks for MY 1993 are forecast 
at 0.59 million metric tons, down 30.0 percent from MY 1992.

C. Minimum CCC Export Edible Sales Price for Additional Peanuts

    The minimum price at which additional peanuts owned or controlled 
by CCC may be sold for use as edible peanuts in export markets is a 
discretionary action that, by practice, is announced at the same time 
as quota and additional peanut support levels to facilitate the 
negotiation of additional peanut contracts by producers and handlers.
    A proposed rule setting forth the MY 1994 minimum CCC export edible 
sales price of $400 per st as well as other determinations not related 
to this notice, was published on November 30, 1993 (58 FR 63106). Eight 
comments were received during the public comment period that ended on 
December 2, 1993. Comments were submitted by four grower and sheller 
organizations that supported the proposed $400 per st minimum CCC 
export edible sales price. Two manufacturers and two manufacturer 
organizations made no recommendations on this issue. For the reasons 
given in the proposed rule, the minimum price at which 1994-crop 
additional peanuts owned or controlled by CCC may be sold for use as 
edible peanuts in export markets is established at $400 per st.

List of Subjects in 7 CFR Part 1421

    Grains, Loan programs--agriculture, Oilseeds, Peanuts, Price 
support programs, Reporting and recordkeeping requirements, Soybeans, 
Surety bonds, Warehouses.

    Accordingly, 7 CFR part 1421 is amended as follows:

PART 1421--GRAINS AND SIMILARLY HANDLED COMMODITIES

    1. The authority citation for 7 CFR part 1421 continues to read as 
follows:

    Authority: 7 U.S.C. 1421, 1423, 1425, 1441z, 1444f-1, 1445b-3a, 
1445c-3, 1445e, and 1446f; 15 U.S.C. 714b and 714c.

    2. Section 1421.7(b)(8)(iii) is amended by:
    A. Removing the period at the end of paragraph (b)(8)(iii) and 
inserting a semicolon in its place; and
    B. Adding paragraph (b)(8)(iv) to read as follows:


Sec. 1421.7  Adjustment of basic support rates.

* * * * *
    (6) * * *
    (8) * * *
    (iv) 1994 Peanuts, Quota--$678.36 per short ton; Additional--
$132.00 per short ton.
* * * * *
    3. Section 1421.27 is amended by:
    A. Removing the period at the end of paragraph (a)(2)(iii) and 
inserting a semicolon in its place, and
    B. Adding paragraph (a)(2)(iv) to read as follows:


Sec. 1421.27  Producer-handler purchases of additional peanuts pledged 
as collateral for a loan.

    (a) * * *
    (2) * * *
    (iv) The 1994 minimum CCC sales price for additional peanuts sold 
for export edible use is $400 per short ton.
* * * * *
    Signed at Washington, DC, on September 8, 1994.
Bruce R. Weber,
Acting Executive Vice President, Commodity Credit Corporation.
[FR Doc. 94-22922 Filed 9-15-94; 8:45 am]
BILLING CODE 3410-05-P