[Federal Register Volume 64, Number 62 (Thursday, April 1, 1999)]
[Rules and Regulations]
[Pages 15634-15636]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-8067]



[[Page 15634]]

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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 905 and 944

[Docket No. FV99-905-1 FIR]


Oranges, Grapefruit, Tangerines, and Tangelos Grown in Florida 
and Imported Grapefruit; Relaxation of the Minimum Size Requirement for 
Red Seedless Grapefruit

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 
relaxing the minimum size requirement for red seedless grapefruit and 
for red seedless grapefruit imported into the United States from size 
48 (3\9/16\ inches diameter) to size 56 (3\5/16\ inches diameter) under 
the Florida citrus marketing order. The marketing order regulates the 
handling of oranges, grapefruit, tangerines, and tangelos grown in 
Florida and is administered locally by the Citrus Administrative 
Committee (Committee). This rule continues to allow handlers and 
importers to ship size 56 red seedless grapefruit through November 7, 
1999, and is expected to maximize grapefruit shipments to fresh market 
channels.

EFFECTIVE DATE: May 3, 1999.

FOR FURTHER INFORMATION CONTACT: William G. Pimental, Southeast 
Marketing Field Office, Marketing Order Administration Branch, F&V, 
AMS, USDA, PO Box 2276, Winter Haven, Florida 33883; telephone: (941) 
299-4770, Fax: (941) 299-5169; or George Kelhart, Technical Advisor, 
Marketing Order Administration Branch, F&V, AMS, USDA, room 2522-S, PO 
Box 96456, Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: 
(202) 720-5698. Small businesses may request information on complying 
with this regulation, or obtain a guide on complying with fruit, 
vegetable, and specialty crop marketing agreements and orders by 
contacting Jay Guerber, Marketing Order Administration Branch, Fruit 
and Vegetable Programs, AMS, USDA, room 2525-S, PO Box 96456, 
Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 720-
5698, or E-mail: Jay__N__G[email protected]. You may also view the 
marketing agreements and orders small business compliance guide at the 
following web site: http://www.ams.usda.gov/fv/moab.html.

SUPPLEMENTARY INFORMATION: This rule 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.''
    This rule is also issued under section 8e of the Act, which 
provides that whenever specified commodities, including grapefruit, are 
regulated under a Federal marketing order, imports of these commodities 
into the United States are prohibited unless they meet the same or 
comparable grade, size, quality, or maturity requirements as those in 
effect for the domestically produced commodities.
    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 the date of the entry of the ruling.
    There are no administrative procedures which must be exhausted 
prior to any judicial challenge to the provisions of import regulations 
issued under section 8e of the Act.
    The order for Florida citrus provides for the establishment of 
minimum grade and size requirements with the concurrence of the 
Secretary. The minimum grade and size requirements are designed to 
provide fresh markets with fruit of acceptable quality and size, 
thereby maintaining consumer confidence for fresh Florida citrus. This 
contributes to stable marketing conditions in the interest of growers, 
handlers, and consumers, and helps increase returns to Florida citrus 
growers. The current minimum grade standard for red seedless grapefruit 
is U.S. No. 1. The current minimum size requirement for domestic 
shipments is size 56 (at least 3\5/16\ inches in diameter) through 
November 7, 1999, and size 48 (3\9/16\ inches in diameter) thereafter. 
The current minimum size for export shipments is size 56 throughout the 
year.
    This rule continues in effect changes to the order's rules and 
regulations relaxing the minimum size requirement for domestic 
shipments of red seedless grapefruit from size 48 (3\9/16\ inches 
diameter) to size 56 (3\5/16\ inches diameter) through November 7, 
1999. This rule allows for the continued shipment of size 56 red 
seedless grapefruit. Absent this relaxation, the minimum size would be 
size 48 (3\9/16\ inches diameter). The Committee met on September 3, 
1998, and unanimously recommended this action.
    Section 905.52 of the order, in part, authorizes the Committee to 
recommend minimum grade and size regulations to the Secretary. Section 
905.306 (7 CFR 905.306) specifies minimum grade and size requirements 
for different varieties of fresh Florida grapefruit. 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 final rule continues the adjustment to Table I establishing a 
minimum size of 56 through November 7, 1999. Minimum grade and size 
requirements for grapefruit imported into the United States are 
currently in effect under Sec. 944.106 (7 CFR 944.106). This final rule 
also continues the adjustment Sec. 944.106 establishing a minimum size 
of 56 through November 7, 1999. Export requirements for Florida red 
seedless grapefruit are not changed by this rule.
    In making its recommendation, the Committee considered estimated 
supply and demand. The supply of red seedless grapefruit is expected to 
be slightly higher than last season based on the Department's official 
crop estimate of 31,500,000 1\3/5\ bushel boxes as compared to last 
season's utilized supply of 30,600,000 boxes. The fruit is expected to 
be high quality with a good appearance. The Committee reports that it 
expects fresh market demand to be sufficient to permit the shipment of 
size 56 red seedless grapefruit grown in

[[Page 15635]]

Florida during the entire 1998-99 season.
    This size relaxation will enable Florida grapefruit shippers to 
continue shipping size 56 red seedless grapefruit to the domestic 
market. This rule will have a beneficial impact on producers and 
handlers, since it will permit Florida grapefruit handlers to make 
available those sizes of fruit needed to meet consumer needs. This is 
consistent with current and anticipated demand in those markets for the 
1998-99 season, and will provide for the maximization of shipments to 
fresh market channels.
    The Committee believes that domestic markets have been developed 
for size 56 fruit and that the industry should continue to supply those 
markets. This minimum size change pertains to the domestic market, and 
does not change the minimum size for export shipments which will 
continue at size 56 throughout the season. The largest market for size 
56 small red grapefruit is for export.
    During the first 11 weeks of the season (September 21 through 
December 6) a volume regulation limited the volume of small red 
seedless grapefruit entering the fresh market. That action was 
successful in moving smaller-sized fruit to those markets demanding 
such sizes (63 FR 51511, September 28, 1998; 64 FR 3807, January 26, 
1999). The Committee agreed that this regulation helped reduce the 
negative effects of size 56 on the domestic market.
    In addition, the currency and economic problems currently facing 
the Pacific Rim countries remain a concern. These countries 
traditionally have been good markets for size 56 grapefruit. Current 
conditions there could reduce demand for grapefruit, and alternative 
outlets need to be available. It will be advantageous to have the 
ability to ship size 56 red seedless grapefruit to the domestic market 
should problems materialize in the export market.
    Based on available information, the Committee unanimously 
recommended that the minimum size for shipping red seedless grapefruit 
to the domestic market should be size 56 through November 7, 1999. This 
rule will have a beneficial impact on producers and handlers because it 
will permit Florida grapefruit handlers to make available those sizes 
of fruit needed to meet anticipated market demand for the 1998-99 
season. Additionally, importers will be favorably affected by this 
change since the relaxation of the minimum size regulation will also 
apply to imported grapefruit.
    Section 8e of the Act provides that when certain domestically 
produced commodities, including grapefruit, are regulated under a 
Federal marketing order, imports of that commodity must meet the same 
or comparable grade, size, quality, and maturity requirements. Since 
this rule continues to relax the minimum size requirement under the 
domestic handling regulations, a corresponding change to the import 
regulations is necessary.
    Minimum grade and size requirements for grapefruit imported into 
the United States are currently in effect under Sec. 944.106. This rule 
continues the minimum size requirement for imported red seedless 
grapefruit at 3\5/16\ inches in diameter (size 56) until November 7, 
1999, to reflect the relaxation under the order for red seedless 
grapefruit grown in Florida.
    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 final 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 the 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. Import regulations issued under 
the Act are based on those established under Federal marketing orders.
    There are approximately 80 grapefruit handlers subject to 
regulation under the order, approximately 11,000 growers of citrus in 
the regulated area, and about 25 grapefruit importers. Small 
agricultural service firms, which include handlers and importers, 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 the industry and Committee data for the 1997-98 season, 
the average annual f.o.b. price for fresh Florida red seedless 
grapefruit during the 1997-98 season was around $6.30 per \4/5\ bushel 
cartons, and total fresh shipments for the 1997-98 season are estimated 
at 15.5 million cartons of red seedless grapefruit. Approximately 20 
percent of all handlers handled 60 percent of Florida grapefruit 
shipments. In addition, many of these handlers ship other citrus fruit 
and products which are not included in Committee data but would 
contribute further to handler receipts. Using the average f.o.b. price, 
about 80 percent of the Florida grapefruit handlers could be considered 
small businesses under the SBA definition and about 20 percent of the 
handlers could be considered large businesses. The majority of 
grapefruit handlers, growers, and importers may be classified as small 
entities.
    Florida handlers shipped approximately 42,410,000 \4/5\ bushel 
cartons of grapefruit to the fresh market during the 1997-98 season. Of 
these cartons, about 21,860,000 were exported. In the past three 
seasons, domestic shipments of Florida grapefruit averaged about 
21,148,000 cartons. During the period 1991 through 1996, imports have 
averaged 734,800 cartons a season. Imports account for less than five 
percent of domestic shipments.
    Section 905.52 of the order, in part, authorizes the Committee to 
recommend minimum grade and size regulations to the Secretary. Section 
905.306 specifies minimum grade and size requirements for different 
varieties of fresh Florida grapefruit. This rule continues to relax the 
minimum size requirement for domestic shipments of red seedless 
grapefruit from size 48 (3\9/16\ inches diameter) to size 56 (3\5/16\ 
inches diameter) through November 7, 1999. No change is being made in 
the minimum size 56 requirement for export shipments. Absent this 
relaxation, the minimum size requirement for domestic shipments would 
be size 48. The motion to allow shipments of size 56 red seedless 
grapefruit through November 7, 1999, was passed by the Committee 
unanimously. In addition, there was a volume regulation in effect for 
the first 11 weeks of this season (September 21 through December 6) 
that limited the volume of small red seedless grapefruit entering the 
fresh market (63 FR 51511, September 28, 1998; 64 FR 3807, January 26, 
1999).
    This rule will have a positive impact on affected entities. This 
action allows for the continued shipment of size 56 red seedless 
grapefruit. This change is not expected to increase costs associated 
with the order requirements.
    This rule continues to relax the minimum size from size 48 (3\9/16\ 
inches diameter) to size 56 (3\5/16\ inches diameter) through November 
7, 1999. This change will allow handlers to continue to ship size 56 
red seedless grapefruit to the domestic market. This rule will have a 
beneficial impact on producers and handlers, since it will permit 
Florida grapefruit handlers to make available those sizes of fruit 
needed to meet consumer needs. This is consistent with current and 
anticipated

[[Page 15636]]

demand in those markets for the 1998-99 season, and will provide for 
the maximization of shipments to fresh market channels.
    The currency and economic problems currently facing the Pacific Rim 
countries remain a concern. These countries traditionally have been 
good markets for size 56 grapefruit. Current conditions there could 
reduce demand for grapefruit, and alternative outlets need to be 
available. It will be advantageous to have the ability to ship size 56 
red seedless grapefruit to the domestic market should problems 
materialize in the export market.
    This change will allow for the continued shipment of size 56 red 
seedless grapefruit. The opportunities and benefits of this rule are 
expected to be equally available to all grapefruit handlers, growers, 
and importers regardless of their size of operation.
    In 1996, imports of grapefruit totaled 15,000 tons (approximately 
705,880 cartons). The Bahamas were the principal source, accounting for 
95 percent of the total. Remaining imports were supplied by the 
Dominican Republic and Israel. Imported grapefruit enters the United 
States from October through May. Imports account for less than five 
percent of domestic shipments.
    Section 8e of the Act provides that when certain domestically 
produced commodities, including grapefruit, are regulated under a 
Federal marketing order, imports of that commodity must meet the same 
or comparable grade, size, quality and maturity requirements. Because 
this rule changes the minimum size for domestic red seedless grapefruit 
shipments, this change will also be applicable to imported grapefruit. 
This rule relaxes the minimum size to size 56. This regulation will 
benefit importers to the same extent that it benefits Florida 
grapefruit producers and handlers because it allows shipments of size 
56 red seedless grapefruit into U.S. markets through November 7, 1999.
    The Committee considered one alternative to this action. The 
Committee discussed relaxing the minimum size to size 56 on a permanent 
basis rather than just for a year. Members said that each season is 
different, and they prefer to consider this issue on a yearly basis. 
Therefore, this alternative was rejected.
    This rule will not impose any additional reporting or recordkeeping 
requirements on either small or large red seedless grapefruit handlers 
or importers. As with all Federal marketing order programs, reports and 
forms are periodically reviewed to reduce information collection 
requirements and duplication by industry and public sectors.
    In addition, the Department has not identified any relevant Federal 
rules that duplicate, overlap or conflict with this rule. However, red 
seedless grapefruit must meet the requirements as specified in the U.S. 
Standards for Grades of Florida Grapefruit (7 CFR 51.760 through 
51.784) issued under the Agricultural Marketing Act of 1946 (7 U.S.C. 
1621 through 1627).
    Further, 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. Like all 
Committee meetings, the September 3, 1998, meeting was a public meeting 
and all entities, both large and small, were able to express their 
views on this issue. Finally, interested persons were invited to submit 
information on the regulatory and informational impacts of this action 
on small businesses.
    In accordance with section 8e of the Act, the United States Trade 
Representative has concurred with the issuance of this final rule.
    An interim final rule concerning this action was published in the 
Federal Register on November 10, 1998 (63 FR 62919). Copies of the rule 
were mailed by the Committee's staff to all Committee members and 
grapefruit handlers. In addition, the rule was made available through 
the Internet by the Office of the Federal Register. That rule provided 
for a 60-day comment period which ended January 11, 1999. No comments 
were received.
    After consideration of all relevant material presented, including 
the Committee's recommendation, and other information, it is found that 
finalizing the interim final rule, without change, as published in the 
Federal Register (63 FR 62919, November 10, 1998) will tend to 
effectuate the declared policy of the Act.

List of Subjects

7 CFR Part 905

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

7 CFR Part 944

    Avocados, Food grades and standards, Grapefruit, Grapes, Imports, 
Kiwifruit, Limes, Olives, Oranges.

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

PART 944--FRUITS; IMPORT REGULATIONS

    Accordingly, the interim final rule amending 7 CFR parts 905 and 
944 which was published at 63 FR 62919 on November 10, 1998, is adopted 
as a final rule without change.

    Dated: March 26, 1999.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 99-8067 Filed 3-31-99; 8:45 am]
BILLING CODE 3410-02-P