[Federal Register Volume 61, Number 200 (Tuesday, October 15, 1996)]
[Rules and Regulations]
[Pages 53607-53608]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-26346]


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DEPARTMENT OF AGRICULTURE
7 CFR Part 981

[Docket No. FV96-981-3FIR]


Almonds Grown in California; Change in Quality Control 
Requirements

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: The Department of Agriculture (Department) is adopting as a 
final rule, without change, the provisions of an interim final rule 
changing the quality control requirements currently prescribed under 
the California almond marketing order. The marketing order regulates 
the handling of almonds grown in California and is administered locally 
by the Almond Board of California (Board). This rule removes the 
exemption from inspection for the Peerless variety of almonds sold 
inshell. This change is needed to bring the administrative rules and 
regulations into conformance with amendments to the marketing order 
recently approved by a majority vote of producers. In addition, this 
change will better reflect current industry practices because most 
almonds are already inspected, including the Peerless variety.

DATES: November 14, 1996.

FOR FURTHER INFORMATION CONTACT: Kathleen M. Finn, Marketing 
Specialist, Marketing Order Administration Branch, F&V, AMS, USDA, room 
2530-S, P.O. Box 96456, Washington, DC 20090-6456: telephone: (202) 
720-1509, Fax # (202) 720-5698; or Martin Engeler, California Marketing 
Field Office, Marketing Order Administration Branch, F&V, AMS, USDA, 
2202 Monterey Street, suite 102B, Fresno, California 93721; telephone: 
(209) 487-5901, Fax # (209) 487-5906. Small businesses may request 
information on compliance with this regulation by contacting: Jay 
Guerber, Marketing Order Administration Branch, Fruit and Vegetable 
Division, AMS, USDA, P.O. Box 96456, room 2525-S, Washington, DC 20090-
6456; telephone (202) 720-2491; Fax # (202) 720-5698.

SUPPLEMENTARY INFORMATION: This final rule is issued under Marketing 
Order No. 981 (7 CFR Part 981), as amended, regulating the handling of 
almonds grown in California, 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 of Agriculture (Department) is issuing this rule in 
conformance with Executive Order 12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule is not intended to have 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 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 to review the Secretary's 
ruling on the petition, provided an action is filed not later than 20 
days after date of the entry of the ruling.
    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact of this action 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 115 handlers of almonds who are subject to 
regulation under the order and approximately 7,000 producers of almonds 
in the regulated area. Small agricultural service firms, which includes 
handlers, have been defined by the Small Business Administration (13 
CFR 121.601) as those having annual receipts of less than $5,000,000, 
and small agricultural producers are defined as those having annual 
receipts of less than $500,000. The majority of handlers and producers 
of California almonds may be classified as small entities.
    This rule finalizes a change in the order's administrative rules 
and regulations to remove an exemption from inspection for the Peerless 
variety of almonds sold inshell as bleaching stock. It also modifies 
the definition of adjusted kernel weight so that adjusted kernel weight 
for the Peerless variety is based on actual weight, consistent with 
other almonds, rather than calculated with a predetermined conversion 
factor known as a shelling ratio. The majority of handlers already have 
all almonds inspected, including the Peerless variety. Therefore, this 
rule will better reflect current industry practice. In addition, this 
rule is needed to bring the administrative rules and regulations into 
conformance with amendments to the marketing order recently approved by 
a majority vote of producers. Since virtually all of the Peerless 
almonds sold inshell are currently inspected, there is little or no 
impact expected on small businesses.
    Therefore, the AMS has determined that this action will not have a 
significant economic impact on a substantial number of small entities.
    The interim final rule was issued on August 14, 1996, and published 
in the Federal Register (61 FR 42990, August 20, 1996), with an 
effective date of August 21, 1996. That rule amended Secs. 981.401 and 
981.442 of the rules and regulations in effect under the order. That 
rule provided a 30-day comment period which ended September 19, 1996. 
No comments were received.
    The almond marketing order authorizes quality control provisions 
which include a requirement that almonds must be inspected prior to 
processing to determine the percentage of inedible kernels in each lot, 
and to determine the adjusted kernel weight of almonds in each lot. 
Inedible kernels are reported to individual handlers and the Board, and 
handlers are required to dispose of a quantity of almonds equal to 
their inedible obligation as determined by the inspection. Inedible 
kernels are disposed of to non-human consumption outlets for such uses 
as animal feed or crushing into oil. Adjusted kernel weight is reported 
to handlers by the Federal-State Inspection Service (FSIS). Handlers 
are then required to report adjusted kernel weight to the Board, who 
uses the information to report industry statistics.

[[Page 53608]]

    The rules and regulations under the marketing order currently 
exempt from inspection the Peerless variety of almonds used as 
bleaching stock and sold inshell. When the quality control regulations 
were initially implemented, it was determined there was no need to 
establish the percentage of inedible kernels of almonds sold inshell, 
which at that time were predominately of the Peerless variety, because 
inedible kernels could not be removed from product sold inshell and 
thus could not be disposed of in non-human consumption outlets. 
Therefore, inshell almonds, including Peerless, are exempt from meeting 
the inedible disposition obligation. However, in order to determine the 
kernel weight of Peerless almonds sold inshell for reporting to the 
Board, a predetermined shelling ratio contained in the marketing order 
has been used in the absence of inspection. This shelling ratio 
converted the weight of inshell almonds to a shelled weight, or kernel 
weight. Over time, the total quantity and varieties of all almonds sold 
inshell have increased, while Peerless bleaching stock sales have 
declined. There has also been an increased desire and need to obtain an 
accurate product weight for growers, handlers, and the Board. Thus, it 
has become common industry practice to have inspections performed on 
Peerless almonds sold inshell, as with other varieties sold inshell, 
regardless of the inspection exemption.
    Consistent with the Act, the almond marketing order was recently 
amended by a majority vote of producers to require that the weight of 
inshell almonds be determined by weighing a representative sample of 
such almonds. Previously, predetermined shelling ratios were used to 
determine the kernel weight. Thus, the shelling ratios were removed 
from the order. The purpose of the quality control amendments was to 
reflect current industry practices as referenced above, and to provide 
more accurate information for reporting purposes.
    The amendments to the order necessitate conforming changes to the 
administrative rules and regulations. Section 981.442 of the quality 
control regulations is revised to remove an inspection exemption for 
Peerless inshell almonds. Thus, all almonds, regardless of form or 
variety, will be inspected.
    In addition, Sec. 981.401 is revised to remove the exemption for 
Peerless almonds from the definition of adjusted kernel weight. 
Currently, the adjusted kernel weight of Peerless inshell almonds is 
based on a predetermined weight contained in the shelling ratio table 
that was removed from the marketing order. Since Peerless inshell 
almonds will be required to have inspection, the actual kernel weight 
will be determined, thus providing an accurate weight.
    The information collection requirements contained in the referenced 
sections have been previously approved by the Office of Management and 
Budget (OMB) under the provisions of 44 U.S.C. Chapter 35 and have been 
assigned OMB number 0581-0071.
    After consideration of all relevant material presented, including 
the Board's recommendation, and other information, it is found that 
finalizing the interim final rule, without change, as published in the 
Federal Register (61 FR 42990, August 20, 1996) will tend to effectuate 
the declared policy of the Act.

List of Subjects in 7 CFR Part 981

    Almonds, Marketing agreements, Nuts, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 981 is 
amended as follows:

PART 981--ALMONDS GROWN IN CALIFORNIA

    Accordingly, the interim final rule amending 7 CFR part 981 which 
was published at 61 FR 42990 on August 20, 1996, is adopted as a final 
rule without change.

    Dated: October 7, 1996.
Robert C. Keeney,
Director, Fruit and Vegetable Division.
[FR Doc. 96-26346 Filed 10-11-96; 8:45 am]
BILLING CODE 3410-02-P