[Federal Register Volume 61, Number 55 (Wednesday, March 20, 1996)]
[Rules and Regulations]
[Pages 11289-11291]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-6694]



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 Rules and Regulations
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  Federal Register / Vol. 61, No. 55 / Wednesday, March 20, 1996 / 
Rules and Regulations  

[[Page 11289]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 982

[Docket No. FV95-982-2FIR]


Filberts/Hazelnuts Grown in Oregon and Washington; Establishment 
of Interim and Final Free and Restricted Percentages for the 1995-96 
Marketing Year

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Department of Agriculture (Department) is adopting as a 
final rule, without change, the provisions of an interim final rule 
which established interim and final free and restricted percentages for 
domestic inshell filberts/hazelnuts for the 1995-96 marketing year 
under the Federal marketing order for filberts/hazelnuts grown in 
Oregon and Washington. The percentages allocate the quantity of 
domestically produced filberts/hazelnuts which may be marketed in the 
domestic inshell market. The percentages are intended to stabilize the 
supply of domestic inshell filberts/hazelnuts to meet the limited 
domestic demand for such filberts/hazelnuts and provide reasonable 
returns to producers. This rule was recommended unanimously by the 
Filbert/Hazelnut Marketing Board (Board), which is the agency 
responsible for local administration of the order.

EFFECTIVE DATE: April 19, 1996.

FOR FURTHER INFORMATION CONTACT: Teresa L. Hutchinson, Marketing 
Specialist, Northwest Marketing Field Office, Fruit and Vegetable 
Division, Agricultural Marketing Service, USDA, 1220 SW. Third Ave., 
Room 369, Portland, OR 97204; telephone: (503) 326-2725 or Mark A. 
Slupek, Marketing Specialist, Marketing Order Administration Branch, 
Fruit and Vegetable Division, AMS, USDA, Room 2536-S, P.O. Box 96456, 
Washington, DC 20090-6456; telephone: (202) 205-2830.

SUPPLEMENTARY INFORMATION: This final rule is issued under Marketing 
Agreement and Order No. 982 (7 CFR Part 982), both as amended, 
regulating the handling of filberts/hazelnuts grown in Oregon and 
Washington, hereinafter referred to as the ``order.'' This order is 
effective under the Agricultural Marketing Agreement Act of 1937, as 
amended (7 U.S.C. 601-674), hereinafter referred to as the ``Act.''
    The Department is issuing this rule in conformance with Executive 
Order 12866.
    This rule has been reviewed under Executive Order 12778, Civil 
Justice Reform. It is intended that this action apply to all 
merchantable filberts/hazelnuts handled during the 1995-96 marketing 
year. This rule will not preempt any State or local laws, regulations, 
or policies, unless they present an irreconcilable conflict with this 
rule.
    The Act 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 provision of the order, or any 
obligation imposed in connection with the order is not in accordance 
with law and request a modification of the order or to be exempted 
therefrom. A handler is afforded the opportunity for a hearing on the 
petition. After the 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 his or her 
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.
    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. Marketing orders issued 
pursuant to the Act, and rules issued thereunder, are unique in that 
they are brought about through group action of essentially small 
entities acting on their own behalf. Thus, both statutes have small 
entity orientation and compatibility.
    There are approximately 1,000 producers of filberts/hazelnuts in 
the production area and approximately 25 handlers subject to regulation 
under the marketing order. Small agricultural producers have been 
defined by the Small Business Administration (13 CFR 121.601) as those 
having annual receipts of less than $500,000, and small agricultural 
service firms are defined as those whose annual receipts are less than 
$5,000,000. The majority of producers and handlers of filberts/
hazelnuts may be classified as small entities.
    The Board's recommendation and this final rule are based on 
requirements specified in the order. The interim final rule was issued 
on January 22, 1996, and published in the Federal Register (61 FR 2665, 
January 29, 1996), with an effective date of January 29, 1996. That 
rule established the amount of inshell filberts/hazelnuts that may be 
marketed in domestic markets. The domestic outlets for this commodity 
are characterized by limited demand, and the finalization of interim 
and final free and restricted percentages will continue to benefit the 
industry by promoting stronger marketing conditions and stabilizing 
prices and supplies, thus improving grower returns. That rule provided 
a 30-day comment period which ended February 28, 1996. No comments were 
received.
    The Board is required to meet prior to September 20 of each 
marketing year to compute an inshell trade demand and preliminary free 
and restricted percentages, if the use of volume regulation is 
recommended during the season. The order prescribes formulas for 
computing the inshell trade demand, as well as preliminary, interim 
final, and final percentages. The inshell trade demand establishes the 
amount of inshell filberts/hazelnuts the handlers may ship to the 
domestic market throughout the season, and the percentages release the 
volume of filberts/hazelnuts necessary to meet the inshell trade 
demand. The preliminary percentages provide for the release of 80

[[Page 11290]]

percent of the inshell trade demand. The interim final percentages 
release 100 percent of the inshell trade demand. The inshell trade 
demand equals the average of the preceding three ``normal'' years' 
trade acquisitions of inshell filberts/hazelnuts, rounded to the 
nearest whole number. The Board may increase such figure by no more 
than 25 percent, if market conditions warrant such an increase. The 
final free and restricted percentages release an additional 15 percent 
of the average of the preceding three years' trade acquisitions of 
inshell filberts/hazelnuts for desirable carryout. Desirable carryout 
is used for early season shipments until the new crop is available for 
market.
    The preliminary free and restricted percentages make available 
portions of the filbert/hazelnut supply subject to regulation which may 
be marketed in domestic inshell markets (free) and exported, shelled, 
or otherwise disposed of (restricted) early in the 1995-96 season. The 
preliminary free percentage is expressed as a percentage of the total 
supply subject to regulation and is based on preliminary crop 
estimates. The majority of domestic inshell filberts/hazelnuts are 
marketed in October, November, and December. By November, the marketing 
season is well under way.
    At its August 28, 1995, meeting, the Board computed and announced 
preliminary free and restricted percentages of 10 percent and 90 
percent, respectively, to release 80 percent of the inshell trade 
demand. The purpose of releasing only 80 percent of the inshell trade 
demand under the preliminary percentage was to guard against 
underestimates of crop size. The preliminary free percentage released 
3,478 tons of filberts/hazelnuts from the 1995 supply for domestic 
inshell use. The preliminary restricted percentage is 100 percent minus 
the free percentage.
    On or before November 15, the Board must meet again to recommend 
interim final and final percentages. The Board uses current crop 
estimates to calculate the interim final and final percentages. The 
interim final percentages are calculated in the same way as the 
preliminary percentages and release 100 percent of the inshell trade 
demand previously computed by the Board for the marketing year. Final 
free and restricted percentages release an additional 15 percent of the 
average of the preceding three years' trade acquisitions to provide an 
adequate carryover into the following season. The final free and 
restricted percentages must be effective at least 30 days prior to the 
end of the marketing year (July 1 through June 30), or earlier, if 
recommended by the Board and approved by the Secretary. In addition, 
revisions in the marketing policy can be made until February 15 of each 
marketing year. However, the inshell trade demand can only be revised 
upward.
    In accordance with order provisions, the Board met on November 15, 
1995, reviewed and approved an amended marketing policy and recommended 
the establishment of interim final and final free and restricted 
percentages. Interim final percentages were recommended at 12 percent 
free and 88 percent restricted, and final free and restricted 
percentages were recommended at 14 percent and 86 percent, 
respectively. The Board also recommended that the final percentages be 
effective on June 1, 1996, which is 30 days prior to the end of the 
season. The interim final percentages made an additional 870 tons of 
inshell filberts/hazelnuts available for the domestic inshell market. 
The interim final marketing percentages are based on the industry's 
final production estimates and released 4,348 tons to the domestic 
inshell market from the 1995 supply subject to regulation. The final 
marketing percentages release an additional 637 tons from the 1995 crop 
for domestic use. Thus, a total of 4,985 tons of inshell filberts/
hazelnuts will be available from the 1995 supply subject to regulation 
for domestic use when the final percentages are established. The 
National Agricultural Statistics Service (NASS) estimated filbert/
hazelnut production at 38,000 tons for the Oregon and Washington area. 
The Board unanimously voted to accept the NASS estimate.
    The marketing percentages are based on the Board's production 
estimates and the following supply and demand information for the 1995-
96 marketing year:

------------------------------------------------------------------------
                                                                 Tons   
------------------------------------------------------------------------
Inshell Supply:                                                         
    (1) Total production (NASS estimate)...................       38,000
    (2) Less substandard, farm use (disappearance).........        2,466
    (3) Merchantable production (the Board's adjusted crop              
     estimate).............................................       35,534
    (4) Plus undeclared carryin as of July 1, 1995, subject             
     to regulation.........................................           11
    (5) Supply subject to regulation (Item 3 plus Item 4)..       35,545
Inshell Trade Demand:                                                   
    (6) Average trade acquisitions of inshell filberts/                 
     hazelnuts for three prior years.......................        4,247
    (7) Increase to encourage increased sales (15 percent               
     of Item 6)............................................          637
    (8) Less declared carryin as of July 1, 1995, not                   
     subject to regulation.................................          536
    (9) Adjusted Inshell Trade Demand......................        4,348
    (10) 15 percent of the average trade acquisitions of                
     inshell filberts/hazelnuts for three prior years (Item             
     6)....................................................          637
    (11) Adjusted Inshell Trade Demand plus 15 percent for              
     carryout (Item 9 plus Item 10)........................        4,985
------------------------------------------------------------------------


                                                                        
                                                    Free      Restricted
Percentages:                                                            
    (12) Interim final percentages (Item 9                              
     divided by Item 5)  x  100...............           12           88
    (13) Final percentages (Item 11 divided by                          
     Item 5)  x  100..........................           14           86

    In addition to complying with the provisions of the marketing 
order, the Board also considers the Department's 1982 ``Guidelines for 
Fruit, Vegetable, and Specialty Crop Marketing Orders'' (Guidelines) 
when making its computations in the marketing policy. This volume 
control regulation provides a method to collectively limit the supply 
of inshell filberts/hazelnuts available for sale in domestic markets. 
The Guidelines provide that the domestic inshell market have available 
a quantity equal to 110 percent of prior years' shipments in those 
outlets before secondary market allocations are approved. This provides 
for plentiful supplies for consumers and for market

[[Page 11291]]

expansion while retaining the mechanism for dealing with oversupply 
situations. At its August 28, 1995, meeting, the Board recommended that 
an increase of 15 percent (637 tons) for market expansion be included 
in the inshell trade demand which was used to compute the interim 
percentages. The established final percentages are based on the final 
inshell trade demand, and will make available an additional 637 tons 
for desirable carryout. The total free supply will be the final trade 
demand of 4,985 tons plus the declared carryin of 536 tons or 5,521 
tons. This is 130 percent of prior years' sales and exceeds the goal of 
the Guidelines.
    Based on the above, the Administrator of the AMS has determined 
that this action will not have a significant economic impact on a 
substantial number of small entities.
    After consideration of all relevant material presented, the 
information and recommendations submitted by the Committee, and other 
information, it is found that finalizing the interim final rule, 
without change, as published in the Federal Register (61 FR 2665, 
January 29, 1996), will tend to effectuate the declared policy of the 
Act.

List of Subjects in 7 CFR Part 982

    Filberts, Hazelnuts, Marketing agreements, Nuts, Reporting and 
recordkeeping requirements.
    For the reasons set forth in the preamble, 7 CFR Part 982 is 
amended as follows:

PART 982--FILBERTS/HAZELNUTS GROWN IN OREGON AND WASHINGTON

    Accordingly, the interim final rule amending 7 CFR part 982, which 
was published at 61 FR 2665 on January 29, 1996, is adopted as a final 
rule without change.

    Dated: March 13, 1996.
Eric M. Forman,
Deputy Director, Fruit and Vegetable Division.
[FR Doc. 96-6694 Filed 3-19-96; 8:45 am]
BILLING CODE 3410-02-P