[Federal Register Volume 59, Number 187 (Wednesday, September 28, 1994)]
[Unknown Section]
[Page ]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-23919]


[Federal Register: September 28, 1994]


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DEPARTMENT OF AGRICULTURE
7 CFR Part 1004

[DA-94-19]


Milk in the Middle Atlantic Marketing Area; Suspension of Certain 
Provisions of the Order

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Suspension of rule.

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SUMMARY: This document suspends certain provisions of the Middle 
Atlantic Federal milk marketing order for the months of September 1994 
through February 1995. The suspension reduces the percent of receipts 
that must be disposed of as Class I disposition by pool distributing 
plants, provides automatic pool plant status for supply plants and 
reserve processing plants that were pool plants during the preceding 
months of September through February, and suspends the limit on the 
amount of milk that may be diverted to nonpool plants by cooperative 
associations and by pool plant operators. The suspension was requested 
by several Middle Atlantic cooperatives and handlers. The suspension is 
necessary to assure that producer milk historically associated with the 
market will continue to be pooled and priced under the order without 
incurring unnecessary and uneconomic movements solely for the purpose 
of maintaining pool status.

EFFECTIVE DATE: September 1, 1994, through February 28, 1995.

FOR FURTHER INFORMATION CONTACT: Gino M. Tosi, Marketing Specialist, 
USDA/AMS/Dairy Division, Order Formulation Branch, Room 2971, South 
Building, P.O. Box 96456, Washington, DC 20090-6456, (202) 690-1366.

SUPPLEMENTARY INFORMATION: Prior document in this proceeding:
    Notice of Proposed Suspension: Issued August 8, 1994; published 
August 12, 1994 (59 FR 41413).
    The Regulatory Flexibility Act (5 U.S.C. 601-612) requires the 
Agency to examine the impact of a proposed rule on small entities. 
Pursuant to 5 U.S.C. 605(b), the Administrator of the Agricultural 
Marketing Service has certified that this rule will not have a 
significant economic impact on a substantial number of small entities. 
This rule lessens the regulatory impact of the order on certain milk 
handlers and tends to ensure that dairy farmers will continue to have 
their milk priced under the order and thereby receive the benefits that 
accrue from such pricing.
    The Department is issuing this final rule in conformance with 
Executive Order 12866.
    This final rule has been reviewed under Executive Order 12778, 
Civil Justice Reform. This rule is not intended to have a retroactive 
effect. This rule will not preempt any state or local laws, 
regulations, or policies, unless they present an irreconcilable 
conflict with this rule.
    The Agricultural Marketing Agreement Act of 1937, as amended (7 
U.S.C. 601-674), 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 provisions of the 
order, or any obligation imposed in connection with the order is not in 
accordance with the law and requesting a modification of an order or to 
be exempted from the order. A handler is afforded the opportunity for a 
hearing on the petition. After a 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 
its principal place of business, has jurisdiction in equity to review 
the Secretary's ruling on the petition, provided a bill in equity is 
filed not later than 20 days after the date of the entry of the ruling.
    This order of suspension is issued pursuant to the provisions of 
the Agricultural Marketing Agreement Act and of the order regulating 
the handling of milk in the Middle Atlantic marketing area.
    Notice of proposed rulemaking was published in the Federal Register 
on August 12, 1994 (59 FR 41413) concerning a proposed suspension of 
certain provisions of the order. Interested persons were afforded 
opportunity to file written data, views and arguments thereon. No 
opposing comments were received.
    After consideration of all relevant material, including the 
proposal in the notice and other available information, it is hereby 
found and determined that for the months of September 1, 1994, through 
February 28, 1995, the following provisions of the order do not tend to 
effectuate the declared policy of the Act:
    1. In Sec. 1004.7(a), the words ``40 percent in the months of 
September through February, and'' and ``in the months of March through 
August''.
    2. In Sec. 1004.7(e), the word ``immediately'' and the words ``for 
each of the following months of March through August,''.
    3. In the introductory text of Sec. 1004.12(d), the words ``in 
accordance with the conditions of paragraphs (d)(1) and (d)(2) of this 
section.''
    4. In Sec. 1004.12, paragraphs (d)(1) and (d)(2).

Statement of Consideration

    This suspension reduces the total Class I disposition standard for 
pool distributing plants, provides automatic pool plant status for 
supply plants and reserve processing plants that were pool plants 
during each of the preceding months of September through February, and 
suspends the limit on the amount of milk that may be diverted to 
nonpool plants by cooperative associations and pool plant operators.
    The first provision suspended reduces the percentage of a 
distributing plant's receipts that have to be disposed of as Class I 
milk to meet the order's pooling standards. With the suspension, a pool 
distributing plant will have to use at least 30 percent, rather than 40 
percent, of its monthly milk receipts as Class I milk during September 
1994 through February 1995.
    The second provision suspended permits supply plants and reserve 
processing plants that have met the order's pooling standards during 
the months of September 1993 through February 1994 to retain pool 
status for the months of September 1994 through August 1995. The 
shipping requirements that normally would have applied to such plants 
during the months of September 1994 through February 1995 are 
eliminated under the suspension.
    The third provision included in the suspension removes the limit on 
the percentage of milk that may be diverted to nonpool plants by a 
cooperative association or a pool plant operator for the period of 
September 1994 through February 1995.
    The suspension was requested by Pennmarva Dairymen's Federation, 
Inc., Atlantic Processing, Inc., Dairylea, Eastern Milk Producers 
Cooperative, and Lehigh Valley Dairies. Together these organizations 
market over 90 percent of the market's producer milk.
    As the proponents contended, producer receipts between 1991 and 
1993 on Order 4 increased while the percentage of the market's producer 
milk used for Class I purposes consistently decreased. A comparison of 
monthly Class I percentages for the months of September through 
February of 1991, 1992, and 1993 show the continuing decline. For 
example, the Class I use percentage for September 1991 was 56.2, while 
in September 1993 it was 51.4 percent. The reduction in Class I use 
results in an increase in diversions to nonpool plants, making it 
increasingly difficult for cooperatives and pool plant operators to 
maintain the pool status of the milk of producers who have historically 
been associated with the market.
    In addition to the decline in Class I use, two large Order 4 
distributing plants with which large volumes of Order 4 diverted milk 
had been associated became regulated under the New York-New Jersey 
order, another Order 4 distributing plant closed, and two additional 
Order 4 distributing plants have changed their product mix, causing a 
reduction of pool plant deliveries for the cooperatives supplying milk 
to these plants. These changes have caused cooperatives and pool plants 
under the order to experience difficulty in associating all of their 
diverted producer milk with the remaining distributing plants now 
regulated under the Middle Atlantic order because the additional 
diverted milk is reducing the Class I use percentage of the plants from 
which it is diverted, thereby jeopardizing their status as pool plants.
    The suspension is found to be necessary to reduce uneconomic 
movements of milk solely for the purpose of meeting pool 
qualifications, and will reflect current marketing conditions without 
causing the milk of producers long associated with the Middle Atlantic 
marketing area to become depooled.
    It is hereby found and determined that thirty days' notice of the 
effective date hereof is impractical, unnecessary and contrary to the 
public interest in that:
    (a) The suspension is necessary to reflect current marketing 
conditions and to assure orderly marketing conditions in the marketing 
area, in that such rule is necessary to permit the continued pooling of 
the milk of dairy farmers who have historically supplied the market 
without the need for making costly and inefficient movements of milk;
    (b) This suspension does not require of persons affected 
substantial or extensive preparation prior to the effective date; and
    (c) Notice of proposed rulemaking was given interested parties and 
they were afforded opportunity to file written data, views or arguments 
concerning this suspension. No opposing comments were received.
    Therefore, good cause exists for making this order effective less 
than 30 days from the date of publication in the Federal Register.

List of Subjects in 7 CFR Part 1004

    Milk marketing orders.

    For the reasons set forth in the preamble, the following provisions 
in Title 7, Part 1004 are amended as follows effective September 1, 
1994 through February 28, 1995:

PART 1004--MILK IN THE MIDDLE ATLANTIC MARKETING AREA

    1. The authority citation for 7 CFR Part 1004 continues to read as 
follows:

    Authority: Secs. 1-19, 48 Stat. 31, as amended; 7 U.S.C. 601-
674.


Sec. 1004.7  [Suspended in part]

    2. In Sec. 1004.7(a), the words ``40 percent in the months of 
September through February, and'' and ``in the months of March through 
August,'' are suspended.
    3. In Sec. 1004.7(e), the word ``immediately'' and the words ``for 
each of the following months of March through August,'' are suspended.


Sec. 1004.12  [Suspended in part]

    4. In the introductory text of Sec. 1004.12(d), the words ``in 
accordance with the conditions of paragraphs (d)(1) and (d)(2) of this 
section.'' are suspended.
    5. In Sec. 1004.12, paragraphs (d)(1) and (d)(2) are suspended.

    Dated: September 22, 1994.
Patricia Jensen,
Acting Assistant Secretary, Marketing and Inspection Services.
[FR Doc. 94-23919 Filed 9-27-94; 8:45 am]
BILLING CODE 3410-02-P