[Federal Register Volume 63, Number 170 (Wednesday, September 2, 1998)]
[Proposed Rules]
[Pages 46708-46711]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-23513]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 905

[Docket No. FV98-905-5 PR]


Oranges, Grapefruit, Tangerines, and Tangelos Grown in Florida; 
Regulation of Fallglo Variety Tangerines

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This rule invites comments on the addition of Fallglo 
tangerines to the varieties of citrus fruit regulated under the 
marketing order covering oranges, grapefruit, tangerines, and tangelos 
grown in Florida. The marketing order is administered locally by the 
Citrus Administrative Committee (committee). This rule would add 
Fallglo tangerines to the varieties covered under the order. It would 
also establish minimum grade and size requirements for the Fallglo 
variety. This rule is intended to assure that the Fallglo tangerines 
entering fresh market channels are of a size and quality acceptable to 
consumers. This proposed rule is in the interest of producers, 
shippers, and consumers.

DATES: Comments must be received by September 22, 1998.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposal. Comments must be sent to the Docket Clerk, 
Fruit and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456, 
Washington, DC 20090-6456; Fax: (202) 205-6632; or E-mail: 
[email protected]. All comments should reference the docket 
number and the date and page number of this issue of the Federal 
Register and will be made available for public inspection in the Office 
of the Docket Clerk during regular business hours.

FOR FURTHER INFORMATION CONTACT: William G. Pimental, Marketing 
Specialist, Southeast Marketing Field Office, Marketing Order 
Administration Branch, F&V, AMS, USDA, P.O. Box 2276, Winter Haven, 
Florida 33883-2276; telephone: (941) 299-4770, Fax: (941) 299-5169; or 
George Kelhart, Technical Advisor, Marketing Order Administration 
Branch, F&V, AMS, USDA, room 2525-S, P.O. Box 96456, Washington, DC 
20090-6456; telephone: (202) 720-2491, Fax: (202) 205-6632. Small 
businesses may request information on compliance with this regulation 
by contacting Jay Guerber, Marketing Order Administration Branch, Fruit 
and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456, 
Washington, DC 20090-6456; telephone (202) 720-2491, Fax: (202) 205-
6632.

SUPPLEMENTARY INFORMATION: This proposal is issued under Marketing 
Agreement No. 84 and Marketing Order No. 905, both as amended (7 CFR 
part 905), regulating the handling of oranges, grapefruit, tangerines, 
and tangelos grown in Florida, hereinafter referred to as the 
``order.'' The marketing agreement and order are 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 proposal has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule is not intended to have retroactive effect. 
This proposal 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 the date of the entry of the ruling.
    The order provides for the establishment of grade and size 
requirements for Florida citrus, with the concurrence of the Secretary. 
These grade and size requirements are designed to provide fresh markets 
with citrus fruit of acceptable quality and size. This helps create 
buyer confidence and contributes to stable marketing conditions. This 
is in the interest of growers, handlers, and consumers, and is designed 
to increase returns to Florida citrus growers.
    This proposed rule would add Fallglo tangerines to the citrus 
varieties covered under the order. It would also establish minimum 
grade and size requirements for the Fallglo variety. This rule is 
designed to help assure that the size and quality of Fallglo tangerines 
entering fresh market channels are acceptable to consumers. This action 
was unanimously recommended by the committee at its meeting on May 22, 
1998.
    Section 905.5 of the order defines the varieties of fruit regulated 
under the order and authorizes the addition of other varieties as 
specified in Sec. 905.4, as recommended by the committee and approved 
by the Secretary. Section 905.105 contains the changes in varieties 
that have been made using this authority. This proposal would add 
Fallglo tangerines to the varieties of citrus fruit regulated under the 
order by modifying Sec. 905.105.
    Fallglo tangerines are a relatively new variety coming into 
significant commercial production. The committee has been following the 
production statistics for Fallglo tangerines. During the last four 
years this variety has experienced rapid production growth. The 
committee uses a level of a million cartons of production as a measure 
in considering a variety's commercial significance. In the 1997-98 
season, total utilization of Fallglo tangerines approximated 1,157,624 
cartons (\4/5\ bushel). This compares to 465,876 (\4/5\ bushel) cartons 
utilized during the 1994-95 season.
    Another indicator of commercial significance is the market share 
held by the variety. For the 1997-98 season, Fallglo tangerines shipped 
fresh totaled approximately 874,000 cartons (\4/5\ bushel), or 
approximately 23 percent of the early tangerine market. As the trees of 
this variety reach full bearing age and additional plantings begin to 
bear fruit, the committee expects shipments of Fallglo tangerines to 
continue to increase and comprise a larger share of the early tangerine 
market.
    The committee believes that the current level of production and 
shipments is significant enough to

[[Page 46709]]

warrant the addition of Fallglo tangerines to the varieties covered 
under the order. This rule would also establish minimum grade and size 
requirements for Fallglo tangerines. Section 905.52 of the order, in 
part, authorizes the committee to recommend minimum grade and size 
regulations to the Secretary. Section 905.306 of the order's rules and 
regulations specifies minimum grade and size requirements for different 
varieties of fresh Florida citrus. Such requirements for domestic 
shipments are specified in Sec. 905.306 in Table I of paragraph (a), 
and for export shipments in Table II of paragraph (b).
    This rule would amend Sec. 905.306 to add the Fallglo tangerine 
variety to the list of entries in Table I of paragraph (a), and in 
Table II of paragraph (b). A minimum grade of U.S. No. 1 as specified 
in the U.S. Standards for Grades of Florida Tangerines (7 CFR 51.1810 
through 51.1837), and a minimum size of 2\6/16\ inches diameter would 
be established for Fallglo tangerines for both domestic and export 
shipments.
    The committee recommended the minimum size of 2\6/16\ inches 
diameter for Fallglo tangerines because this variety of tangerine tends 
to grow larger than the other tangerine varieties regulated at the 2\4/
16\ inch minimum diameter, and it can easily attain the larger size. 
The minimum grade of U.S. No. 1 was recommended by the committee for 
this variety because tangerines meeting the requirements of this grade 
are mature, and, while having more cosmetic defects than the higher 
grades specified in the standards, the defects do not materially 
detract from the appearance, or the edible or marketing quality of the 
fruit. All regulated varieties of Florida tangerines, except Honey 
tangerines, have a minimum U.S. No. 1 grade. Honey tangerines are not 
regulated at U.S. No. 1 because their skin possesses excessive amounts 
of green coloring which causes them to exceed the tolerances for that 
grade defect. Honey tangerines must be at least Florida No. 1 grade, 
which permits more green coloring than U.S. No. 1. According to the 
committee, almost all of the Fallglo tangerines shipped fresh in 1997-
98 would have met the proposed requirements had they been in effect.
    Minimum grade and size requirements for domestic and export 
shipments of tangerines are designed to prevent shipments of low grade, 
immature, small sized, or otherwise unsatisfactory fruit from entering 
fresh market channels. Preventing such shipments helps create buyer 
confidence in the marketplace and helps foster stable marketing 
conditions in the interest of producers.
    The committee noted that fresh shipments of Fallglo tangerines had 
increased from 381,990 cartons (\4/5\ bushel) in 1994-95 to 874,076 
cartons (\4/5\ bushel) in 1997-98. Total utilization had increased from 
465,876 \4/5\ bushel cartons in 1994-95 to 1,157,624 \4/5\ bushel 
cartons in 1997-98. In the 1997-98 season, approximately 76 percent of 
the Fallglo tangerine crop was shipped in fresh market channels, 
representing approximately 23 percent of the early tangerine crop. The 
committee believes that the current market share and shipment levels 
justify establishing minimum grade and size requirements for Fallglo 
tangerines and that these requirements are needed to help assure and 
maintain acceptable shipments.
    The committee further believes that the addition of this variety to 
those regulated under the order and the establishment of minimum grade 
and size requirements for Fallglo tangerines will become increasingly 
important as production and market share increase. The establishment of 
such requirements for this tangerine variety is expected to help ensure 
that only fresh fruit of acceptable size and quality reaches consumers 
in the interest of producers, handlers, and consumers. Experience has 
shown that providing uniform quality and size acceptable to consumers 
helps stabilize the market, improves grower returns, and fosters market 
growth.
    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. Accordingly, AMS has 
prepared this initial regulatory flexibility analysis.
    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 75 tangerine handlers subject to regulation 
under the order and approximately 11,000 growers of citrus in the 
regulated area. Small agricultural service firms have been defined by 
the Small Business Administration (SBA) 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 (13 CFR 121.601).
    Based on industry and committee data for the 1997-98 season, the 
average annual free-on-board price for fresh Florida tangerines during 
the 1997-98 season was around $12.51 per \4/5\ bushel carton, and total 
fresh shipments of early tangerines for the 1997-98 season are 
estimated at 3.8 million cartons.
    Approximately 40 percent of all handlers handled 80 percent of 
Florida tangerine shipments. In addition, many of these handlers ship 
other citrus fruit and products that would contribute further to 
handler receipts. About 80 percent of citrus handlers could be 
considered small businesses under SBA's definition and about 20 percent 
of the handlers could be considered large businesses. The majority of 
Florida citrus handlers, and growers may be classified as small 
entities.
    Under Sec. 905.5 the committee has the authority to recommend to 
the Secretary the addition of other citrus varieties to those covered 
under the order. Section 905.52 of the order, in part, authorizes the 
committee to recommend minimum grade and size regulations to the 
Secretary. Pursuant to this authority, minimum grade and size 
requirements for domestic and export shipments are specified for 
numerous citrus varieties covered under the order. Currently, Fallglo 
tangerines are not included under the order and no minimum grade and 
size requirements are established for this variety.
    This rule would make changes to Secs. 905.105 and 905.306 of the 
rules and regulations concerning covered varieties and minimum grade 
and size requirements, respectively. This rule would add Fallglo 
tangerines to the varieties covered under the order. It would also 
establish a minimum grade and size requirement for Fallglo tangerines. 
The establishment of such requirements for this variety would help 
stabilize the market and improve grower returns by providing uniform 
quality and size acceptable to consumers.
    This regulation would have a positive impact on affected entities. 
This action is intended to maintain and improve quality. The purpose of 
this rule would be to improve the quality of fruit entering fresh 
market channels in the interest of producers, shippers, and consumers. 
Minimum grade and size requirements for domestic and export shipments 
of tangerines are designed to prevent shipments of low grade, immature, 
small sized, or otherwise unsatisfactory fruit from entering fresh 
market channels.
    While this rule would establish a minimum grade and size 
requirement

[[Page 46710]]

for Fallglo tangerines, many handlers in the industry have been using 
these requirements voluntarily. According to the committee, almost all 
of the Fallglo tangerines shipped fresh in 1997-98 (874,076 \4/5\ 
bushel cartons) would have met the requirements proposed in this rule 
(i.e., U.S. No. 1 and 2\6/16\ inches in diameter) had they been in 
effect. Therefore, this rule should not be overtly restrictive, and the 
overall effect on costs is expected to be minimal in relation to the 
benefits expected.
    Regarding expected handler inspection costs, three inspection and 
certification options are being used by Florida citrus handlers 
regulated under the order. The options are Partners in Quality (PIQ), 
continuous in-line, and lot inspection. The PIQ inspection option is an 
audit based quality assurance program between inspection officials of 
the Fresh Products Branch, F&V, AMS, USDA, and officials from the 
individual packinghouses. Under PIQ, the packinghouse and inspection 
officials develop a system of checks along the processing/packing line 
which demonstrate and document their ability to pack product that meets 
all applicable requirements. The effectiveness of PIQ is verified 
through periodic, unannounced audits of each packer's system by USDA-
approved auditors. Under the latter two inspection options, the 
commodity is inspected by Federal or Federal-State inspection officials 
as packaged product, rather than before packaging by packinghouse 
officials as with PIQ, and the results are certified. Current costs are 
$0.04 cents per carton for PIQ type inspection, $0.07 cents per carton 
for continuous in-line inspection, and $39.00 per hour for lot 
inspection.
    By not setting minimum quality and size regulations, a quantity of 
poor quality, small sized fruit may reach the retail market, resulting 
in consumer dissatisfaction and product substitution. Such a lapse in 
quality and/or size could result in a price reduction. Preventing such 
shipments helps create a buyer confidence in the marketplace and helps 
foster stable marketing conditions in the interest of producers.
    A stabilized market that returns a fair price would be beneficial 
to both small and large growers and handlers. The opportunities and 
benefits of this rule are expected to be available to all Fallglo 
tangerine growers and handlers regardless of their size of operation.
    This action would not impose any additional reporting or 
recordkeeping requirements on either small or large citrus handlers. As 
with all Federal marketing order programs, reports, and forms are 
periodically reviewed to reduce information requirements and 
duplication by industry and public sector agencies.
    The Department has not identified any relevant Federal rules that 
duplicate, overlap, or conflict with this proposed rule. However, 
tangerines must meet the requirements as specified in the U.S. 
Standards for Grades of Florida Tangerines (7 CFR 51.1810 through 
51.1837) issued under the Agricultural Marketing Act of 1946 (7 U.S.C. 
1621 through 1627).
    In addition, the committee's meeting was widely publicized 
throughout the citrus industry and all interested persons were invited 
to attend the meeting and participate in committee deliberations on all 
issues. Like all committee meetings, the May 22, 1998, meeting was a 
public meeting and all entities, both large and small, were able to 
express views on this issue. Interested persons are invited to submit 
information on the regulatory and informational impacts of this action 
on small businesses.
    A 20-day comment period is provided to allow interested persons to 
respond to this proposal. Twenty days is deemed appropriate because 
handlers are expected to begin shipping Fallglo tangerines in early 
October and any changes to the regulation implemented as a result of 
this action should be announced as soon as possible so producers and 
handlers can plan accordingly. All written comments timely received 
will be considered before a final determination is made on this matter.

List of Subjects in 7 CFR Part 905

    Grapefruit, Marketing agreements, Oranges, Reporting and 
recordkeeping requirements, Tangelos, Tangerines.

    For the reasons set forth in the preamble, 7 CFR part 905 is 
proposed to be amended as follows:

PART 905--ORANGES, GRAPEFRUIT, TANGERINES, AND TANGELOS GROWN IN 
FLORIDA

    1. The authority citation for 7 CFR Part 905 continues to read as 
follows:

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

    2. In Sec. 905.105, paragraph (b) is revised to read as follows:


Sec. 905.105  Tangerine and grapefruit classifications.

* * * * *
    (b) Pursuant to Sec. 905.5(m), the term ``variety'' or 
``varieties'' includes Sunburst and Fallglo tangerines.
    3. Section 905.306 is amended by adding a new entry for Fallglo 
tangerines in paragraph (a), Table I, and in paragraph (b), Table II, 
to read as follows:


Sec. 905.306  Orange, Grapefruit, Tangerine, and Tangelo Regulations.

    (a) * * *

                                                     Table I                                                    
                                                                                                                
                                                                                                       Minimum  
                 Variety                       Regulation period              Minimum Grade           diameter  
                                                                                                      (inches)  
(1)                                       (2)........................  (3)........................          (4) 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
      *                   *                   *                   *                   *                   *     
                                                  *                                                             
               Tangerines                                                                                       
                                                                                                                
      *                   *                   *                   *                   *                   *     
                                                  *                                                             
Fallglo.................................  On and after 10/1/98.......  U.S. No. 1.................      2\6/16\ 
                                                                                                                
      *                   *                   *                   *                   *                   *     
                                                  *                                                             
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    (b) * * *

[[Page 46711]]


                                                    Table II                                                    
                                                                                                                
                                                                                                       Minimum  
                 Variety                       Regulation period              Minimum Grade           diameter  
                                                                                                      (Inches)  
(1)                                       (2)........................  (3)........................          (4) 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
      *                   *                   *                   *                   *                   *     
                                                  *                                                             
               Tangerines                                                                                       
                                                                                                                
      *                   *                   *                   *                   *                   *     
                                                  *                                                             
Fallglo.................................  On and after 10/1/98.......  U.S. No. 1.................      2\6/16\ 
                                                                                                                
      *                   *                   *                   *                   *                   *     
                                                  *                                                             
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* * * * *
    Dated: August 26, 1998.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-23513 Filed 9-1-98; 8:45 am]
BILLING CODE 3410-02-P