[Federal Register Volume 64, Number 112 (Friday, June 11, 1999)]
[Proposed Rules]
[Pages 31512-31518]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-14844]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
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 

  Federal Register / Vol. 64, No. 112 / Friday, June 11, 1999 / 
Proposed Rules  

[[Page 31512]]


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DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection Service

7 CFR Part 319

[Docket No. 98-054-1]
RIN 0579-AB02


Importation of Unmanufactured Wood Articles From Mexico

AGENCY: Animal and Plant Health Inspection Service, USDA.

ACTION: Proposed rule.

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SUMMARY: We are proposing to add restrictions on the importation of 
pine and fir logs and lumber, as well as other unmanufactured wood 
articles, from Mexico. This change would require that these wood 
articles from Mexico meet certain treatment and handling requirements 
to be eligible for importation into the United States. We believe this 
action is necessary to prevent the introduction into the United States 
of dangerous plant pests, including forest pests, with unmanufactured 
wood articles from Mexico.

DATES: Consideration will be given only to comments received on or 
before August 10, 1999.

ADDRESSES: Please send an original and three copies of your comments to 
Docket No. 98-054-1, Regulatory Analysis and Development, PPD, APHIS, 
suite 3C03, 4700 River Road Unit 118, Riverdale, MD 20737-1238. Please 
state that your comments refer to Docket No. 98-054-1. Comments 
received may be inspected at USDA, room 1141, South Building, 14th 
Street and Independence Avenue SW., Washington, DC, between 8 a.m. and 
4:30 p.m., Monday through Friday, except holidays. Persons wishing to 
inspect comments are requested to call ahead on (202) 690-2817 to 
facilitate entry into the comment reading room.

FOR FURTHER INFORMATION CONTACT: Ms. Jane E. Levy, Senior Staff 
Officer, Port Operations, PPQ, APHIS, 4700 River Road Unit 60, 
Riverdale, MD 20737-1236; (301) 734-8295.

SUPPLEMENTARY INFORMATION:

Background

    The unrestricted importation of logs, lumber, and other 
unmanufactured wood articles into the United States could pose a 
significant hazard of introducing plant pests detrimental to 
agriculture and to natural, cultivated, and urban forests. ``Subpart--
Logs, Lumber, and Other Unmanufactured Wood Articles,'' contained in 7 
CFR 319.40-1 through 319.40-11 (and referred to below as the wood 
subpart), is intended to mitigate the plant pest risk presented by the 
importation of logs, lumber, and other unmanufactured wood articles.
    Currently, Sec. 319.40-3(a) provides a general permit for the 
importation of unmanufactured wood articles (other than articles from 
certain subfamilies of the family Rutaceae) into the United States from 
Canada and from States in Mexico adjacent to the United States/Mexico 
border. A general permit means the written authorization provided in 
Sec. 319.40-3; no separate paper permit is required. Under a general 
permit, unmanufactured wood articles from Canada and from Mexican 
States adjacent to the U.S. border may be imported into the United 
States provided they are accompanied by an importer document stating 
that the articles are derived from trees harvested in, and have never 
been moved outside, Canada or adjacent States in Mexico, and subject to 
the inspection and other requirements in Sec. 319.40-9. Unmanufactured 
wood articles imported into the United States from adjacent States in 
Mexico in accordance with Sec. 319.40-3(a) include, but are not limited 
to, logs, lumber, railroad ties, fence posts, firewood, solid wood 
packing material, and mesquite wood for cooking.
    In contrast, unmanufactured wood articles from Mexican States that 
are not adjacent to the United States/Mexico border are subject to the 
more rigorous requirements of the wood subpart for importing wood 
articles from all other countries except Canada. These more rigorous 
requirements include requirements for treatment and other special 
handling to ensure freedom from plant pests. Section 319.40-5 provides 
import and entry requirements for specified regulated articles such as 
bamboo timber (Sec. 319.40-5(a)), tropical hardwoods (Sec. 319.40-
5(c)), temperate hardwoods (Sec. 319.40-5(d)), and railroad ties 
(Sec. 319.40-5(f)). Section 319.40-6 provides universal importation 
options, including treatment and handling options, for unmanufactured 
wood articles imported into the United States, including logs 
(Sec. 319.40-6(a)), lumber (Sec. 319.40-6(b)), wood chips and bark 
chips (Sec. 319.40-6(c)), wood mulch, humus, compost, and litter 
(Sec. 319.40-6(d)), and cork and bark (Sec. 319.40-6(e)).
    The less restrictive importation requirements for unmanufactured 
wood articles imported into the United States from Canada and the 
States of Mexico adjacent to the United States/Mexico border are based 
on the premise that the forests in the United States share a common 
forested boundary with Canada and adjacent States in Mexico and, 
therefore, share, to a reasonable degree, the same forest pests.
    However, in February 1998, the Forest Service, U.S. Department of 
Agriculture (USDA), published a study entitled ``Pest Risk Assessment 
of the Importation into the United States of Unprocessed Pinus and 
Abies Logs from Mexico.'' \1\ This pest risk assessment was requested 
by the Animal and Plant Health Inspection Service (APHIS), USDA, to 
evaluate the forest insect and pathogen complexes in the forests of the 
United States and the adjacent States of Mexico. The Forest Service's 
pest risk assessment shows that a significant pest risk exists in the 
movement of raw wood material into the United States from the adjacent 
States of Mexico. This conclusion has also been confirmed by USDA 
inspectors finding a number of dangerous plant pests on wood imports 
from adjacent States in Mexico during inspections at ports of entry 
along the United States/Mexico border.
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    \1\ For copies of this pest risk assessment, contact the person 
listed under FOR FURTHER INFORMATION CONTACT or access the 
assessment on the Forest Service's Forest Products Laboratory Web 
site at Internet address http://www.fpl.fs.fed.us/documents/fplgtr/
fplgtr104.pdf
_____________________________________-

 The Forest Service's pest risk assessment clearly indicates that 
the mountain top forests of the adjacent States in Mexico, from which 
unmanufactured wood articles are moving into the United States, should 
be viewed as biological islands, not as an extension of the U.S. forest 
ecosystem. These biological islands

[[Page 31513]]

contain their own unique combination of forest pests, which are 
different than those currently found in the United States. Those pests 
have the potential to substantially harm U.S. forests if they become 
established in the United States.
    In its research, the Forest Service used pine and fir pests as 
surrogates for determining the overall pest risk associated with all of 
the native trees grown in these isolated biological forested regions in 
Mexico. This method was used in order to keep the assessment 
manageable. Timber species of pine and fir were chosen specifically 
because: (1) They constitute the majority of the unmanufactured wood 
articles imported into the United States from Mexico; and (2) the pest 
complexes of pine and fir trees have been the focus of more research, 
and are, therefore, better understood than the pest complexes for many 
other genera of imported timber trees. APHIS concurs with the Forest 
Service that extrapolation of this type of data is scientifically both 
rational and defensible.
    Based on the conclusions of the Forest Service's pest risk 
assessment, we are proposing to amend the wood subpart in three ways.
    First, we propose to limit the use of a general permit under 
Sec. 319.40-3(a) for unmanufactured wood articles imported from the 
adjacent States in Mexico. Under proposed Sec. 319.40-3(a), only 
unmanufactured mesquite wood for cooking, unmanufactured wood for 
firewood, and small, noncommercial packages of unmanufactured wood for 
personal cooking or personal medicinal purposes would be allowed 
importation under a general permit.\2\ Mesquite is a woody species that 
is continuous on both sides of the United States/Mexico border and, 
therefore, presents little foreign pest risk. Firewood would not pose a 
significant pest risk because of its limited distribution and 
consumption near the border. Small, noncommercial packages of 
unmanufactured wood to be used for personal cooking or personal 
medicinal purposes also would not pose a significant pest risk because 
the packages would be limited in quantity and therefore easily 
inspected, and likely would be distributed and consumed near the 
border. Except as discussed below, all other unmanufactured wood 
articles from the adjacent States of Mexico would be allowed into the 
United States only in accordance with the importation and entry 
requirements in place for unmanufactured wood articles from the rest of 
Mexico and all other countries except Canada. This proposed rule would 
result in a more consistent regulation of unmanufactured wood articles 
from all the States of Mexico, as well as all other countries except 
Canada.
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    \2\ Other unmanufactured wood articles, such as solid and loose 
wood packing material and bamboo timber, would continue to be 
allowed importation into the United States under a general permit in 
accordance with Sec. 319.40-3(b), (c), (d), and (e).
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    Second, we propose to amend Sec. 319.40-5 to add an additional 
treatment option for pine and fir lumber from Mexico. Currently, the 
only treatment options for imported pine and fir lumber from Mexico are 
heat treatment (under Sec. 319.40-7(c)) or heat treatment with moisture 
reduction (under Sec. 319.40-7(d)) before importation into the United 
States, as required by Sec. 319.40-6(b)(1); or heat treatment or heat 
treatment with moisture reduction within 30 days after release from the 
port of first arrival in the United States, at a U.S. facility 
operating under a compliance agreement with APHIS, as required by 
Sec. 319.40-6(b)(2). However, based on conclusions of the Forest 
Service's pest risk assessment and on APHIS' evaluation of treatment 
options, we are proposing to allow standard industry cut lumber made 
from pine or fir species originating in Mexico to be imported into the 
United States from any State of Mexico if, prior to arrival, that 
lumber is 100 percent free of bark and fumigated with methyl bromide in 
accordance with schedule T-312 contained in the Plant Protection and 
Quarantine Treatment Manual, incorporated by reference at Sec. 300.1, 
or with an initial methyl bromide concentration of at least 240 g/m\3\ 
with exposure and concentration levels adequate to provide a 
concentration-time product of at least 17,280 gram-hours calculated on 
the initial methyl bromide concentration. This treatment is effective 
against the pine and fir pests identified in the Forest Service's pest 
risk assessment.
    Third, we propose to amend Sec. 319.40-5 to add an additional 
treatment option, with a thickness requirement, to the importation of 
railroad ties from Mexico. Currently, pursuant to Sec. 319.40-5(f), 
railroad ties from nonborder States of Mexico must be completely free 
of bark and accompanied by an importer document stating that the 
railroad ties will be pressure treated within 30 days following the 
date of importation to be eligible for importation into the United 
States. Because of the proposed change to the general permit section of 
the wood subpart described earlier, railroad ties from States of Mexico 
adjacent to the U.S. border would no longer be eligible for importation 
into the United States under a general permit. Based on conclusions of 
the Forest Service's pest risk assessment, we propose to amend 
Sec. 319.40-5 to provide an additional treatment option for the 
importation of railroad ties from Mexico that would allow the 
importation of railroad ties (cross-ties) originating from all States 
in Mexico if they are 100 percent free of bark, no thicker than 8 
inches, and fumigated with methyl bromide using the concentration 
levels specified in the paragraph above. Railroad ties may continue to 
be imported under current requirements that they be completely free of 
bark and pressure-treated with a preservative approved by the U.S. 
Environmental Protection Agency (EPA) within 30 days following the date 
of importation. Under the existing requirements, we would also allow 
Mexican railroad ties that are debarked in accordance with Sec. 319.40-
7(b) to be imported into the United States if the railroad ties have 
been heat treated in accordance with Sec. 319.40-7(c).
    These actions appear to be necessary to reduce the risk of the 
introduction of dangerous plant pests on unmanufactured wood articles 
moving from Mexico into the United States.

Use of Methyl Bromide

    Methyl bromide is currently in widespread use as a fumigant. It is 
proposed as a treatment option for standard industry cut lumber made 
from pine or fir species and railroad ties from Mexico. The 
environmental effects of using methyl bromide, however, are being 
scrutinized by international, Federal, and State agencies. EPA, based 
on its evaluation of data concerning the ozone depletion potential of 
methyl bromide, published a final rule in the Federal Register on 
December 10, 1993 (58 FR 65018-65082). That rule froze methyl bromide 
production in the United States at 1991 levels and required the phasing 
out of domestic use of methyl bromide by the year 2001. EPA's methyl 
bromide regulations were issued under the authority of the Clean Air 
Act. Recently, the Agriculture, Rural Development, Food and Drug 
Administration, and Related Agencies Appropriations Act, 1999, amended 
the Clean Air Act. The amendments provide that the production of methyl 
bromide shall not terminate prior to January 1, 2005, and directs EPA 
to promulgate new rules to reduce and terminate the production, 
importation, and consumption of methyl bromide in accordance with the 
phaseout schedule of the Montreal Protocol. The Montreal Protocol, an 
international treaty governing the production and use of ozone-
depleting chemicals, provides for a phaseout of methyl bromide, with an

[[Page 31514]]

exemption for quarantine and preshipment uses, in developed countries 
by the year 2005 and in developing countries, including Mexico, by the 
year 2015. EPA has indicated that it will publish proposed and final 
regulations to achieve production and importation reductions from the 
1991 base levels of methyl bromide as follows: 25 percent reduction in 
1999, 50 percent reduction in 2001, 70 percent reduction in 2003, 100 
percent reduction in 2005. The Agriculture, Rural Development, Food and 
Drug Administration, and Related Agencies Appropriations Act, 1999, 
further provides a quarantine-use exemption for the production, 
importation, consumption of methyl bromide to fumigate commodities 
entering or leaving the United States for purposes of complying with 
APHIS regulations. EPA has also indicated that it will work closely 
with USDA, State agricultural departments, and other stakeholders to 
define the preshipment and quarantine uses that will be exempt from the 
phaseout. Our proposal assumes the continued availability of methyl 
bromide for use as a fumigant for at least the next few years. 
Nonetheless, APHIS is studying the effectiveness and environmental 
acceptability of alternative treatments to prepare for the eventual 
unavailability of methyl bromide fumigation.

Miscellaneous

    We are also proposing to amend Sec. 319.40-5(f) to require that 
pressure treatment of railroad ties be conducted at a U.S. facility 
under compliance agreement with APHIS. This would affect railroad ties 
imported from all countries except Canada. We propose this action to 
help ensure compliance with the requirement that railroad ties must be 
pressure treated within 30 days following the date of importation into 
the United States.
    In Sec. 319.40-3, paragraph (a) requires articles imported under 
general permit to be accompanied by an importer document. The importer 
document must state that the regulated articles are derived from trees 
that were harvested in, and have never moved outside, Canada or States 
in Mexico adjacent to the U.S. border. We are proposing to amend 
Sec. 319.40-3(a) to remove the requirement that the importer document 
must state that the articles have never been moved outside Canada or 
States in Mexico adjacent to the U.S. border; the ``derived from'' 
requirement will remain. We are also proposing to amend Sec. 319.40-
3(a) to specify that the importer document only needs to accompany 
commercial shipments of unmanufactured wood articles imported into the 
United States under a general permit. With respect to Mexico, the 
importer document requirement currently helps ensure that logs and 
lumber from adjacent States in Mexico are not moved into other States 
in Mexico for processing or milling and then imported into the United 
States. However, because we are proposing to disallow movement under 
general permit for most unmanufactured wood articles from adjacent 
States in Mexico, this precaution would no longer be necessary. With 
respect to Canada, it is highly improbable that wood articles from 
Canada would be processed or milled in another country and then 
returned to Canada for export to the United States. Therefore, we do 
not believe that this requirement is necessary for unmanufactured wood 
articles imported into the United States from Canada. Further, it is 
not administratively feasible to require an importer document for 
noncommercial shipments of mesquite wood for cooking and firewood, or 
for small, noncommercial packages of unmanufactured wood for personal 
cooking or personal medicinal uses imported into the United States from 
States in Mexico adjacent to the United States border; therefore, we 
propose to specify that commercial shipments of unmanufactured wood 
articles imported from Canada, and commercial shipments of mesquite 
wood for cooking and firewood imported from adjacent States in Mexico, 
be accompanied by the importer document described above.

Executive Order 12866 and Regulatory Flexibility Act

    This proposed rule has been reviewed under Executive Order 12866. 
The rule has been determined to be significant for the purposes of 
Executive Order 12866 and, therefore, has been reviewed by the Office 
of Management and Budget.
    We are proposing to amend the wood subpart by adding a treatment 
option for pine and fir lumber and railroad ties imported from Mexico, 
and by adding that unmanufactured wood articles from Mexico's border 
States meet certain treatment and handling requirements to be eligible 
for importation into the United States. We believe this action is 
necessary to help prevent the introduction into the United States of 
dangerous plant pests, including forest pests, with unmanufactured wood 
articles from Mexico.
    Because this proposal concerns unmanufactured wood articles, it 
would affect the importation into the United States of both hardwood 
and softwood species from Mexico. However, this analysis focuses on 
softwood lumber, particularly pine and fir, since it comprises nearly 
all the unmanufactured wood articles imported from Mexico. In 1997, 
imports of U.S. lumber from Mexico consisted of about 98 percent 
softwood species, by value, and only about 2 percent hardwood species. 
Also in 1997, 97 percent of U.S. imports of unmanufactured softwood 
articles from Mexico, not including solid wood packing material (SWPM) 
and continuously shaped softwood (which may be manufactured), were 
softwood lumber.
    The value of U.S. production of softwood lumber in 1996 was about 
$16 billion. U.S. production of softwoods that year totaled 33.9 
billion board feet (bbf), compared to 12.7 bbf of hardwoods. Softwood 
imports in 1996 reached 18.0 bbf, compared to exports of 1.9 bbf, for 
net imports of 16.1 bbf. In other words, U.S. supply of softwoods, not 
including stocks, was about 50 bbf (production + imports - exports), 
with about one-third of the nation's supply imported.
    Values of 1997 U.S. imports and exports of some major categories of 
unmanufactured softwood articles are found in table 1, below. U.S. 
trade with both the whole world and Mexico is shown, allowing some 
insight into Mexico's share of U.S. imports, and the U.S. trade 
position overall for these commodities. By far, the main commodity is 
softwood lumber, for which U.S. imports, worth $7.3 billion, dwarfed 
U.S. exports, worth $1.1 billion. Of the commodities included in table 
1, 93 percent of imports were softwood lumber. Softwood lumber imports 
from Mexico, at $97.6 million, represent 1 percent of total U.S. 
softwood lumber imports.
    Continuously shaped softwood is a category that includes both 
manufactured and unmanufactured articles. Therefore, the value shown 
for these imports from Mexico ($120 million) overstates the value of 
imports that would be affected by the proposed rule. (On the other 
hand, there are other unmanufactured wood articles that enter from 
Mexico, such as solid wood packing material, that are not shown in this 
table.) As indicated, one-fourth of continuously shaped softwood that 
is imported into the United States comes from Mexico. As is the case of 
softwood lumber, the value of U.S. imports of these articles is several 
times greater than the value of exports.
    The United States is a large net exporter of untreated softwood 
logs and poles, with 1997 exports valued at about $1.5 billion, 
compared to 1997 imports

[[Page 31515]]

of $61 million. Of these imports, Mexico is a minor supplier, providing 
three percent of the total. Similarly, for fuel wood and railroad ties 
(not impregnated),\3\ Mexico supplied only a small portion of total 
U.S. imports in 1997: 6 percent, in each instance.
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    \3\ Impregnated railway ties are not considered unmanufactured 
wood articles.
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    In summary, unmanufactured softwood articles imported into the 
United States are predominantly lumber. Their value significantly 
outweighs that of exports of U.S. softwood lumber. In 1997, about one 
percent of softwood lumber imports, worth about $97.6 million, came 
from Mexico. Shipments from Mexico of continuously shaped softwood are 
of greater value ($120 million in 1997), but a large share may be 
manufactured articles. For softwood logs and poles, the United States 
is in a strong net export position, with the value of imports only 
about four percent of the value of exports. Importations from Mexico of 
softwood logs and poles, fuel wood, and railway ties represent small 
percentages of total U.S. imports of these commodities.

                           Table 1.--U.S. Trade With Mexico and the World in Principal Unmanufactured Softwood Articles, 1997
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                                                                       U.S. imports                                       U.S. exports
                                                   -----------------------------------------------------------------------------------------------------
                   Wood category                     From the world      From Mexico      Percentage     To the world        To Mexico     Percentage to
                                                        (dollars)         (dollars)      from Mexico       (dollars)         (dollars)         Mexico
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Softwood lumber...................................     7,345,096,000        97,614,000            1       1,100,577,000        39,435,000            4
Softwood, continuously shaped.....................       488,057,000       120,340,000           25         111,756,000         8,310,000            7
Softwood logs and poles, not treated..............        61,207,000         1,764,000            3       1,488,347,000         3,001,000            0.2
Fuel wood.........................................         6,220,000           377,000            6           5,601,000           170,000            3
Railway ties, not impregnated.....................         3,850,000           232,000            6           8,938,000            11,000            0.1
                                                   -----------------------------------------------------------------------------------------------------
    Total.........................................     7,904,430,000       220,327,000            2.8     2,715,219,000        50,927,000            1.9 
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Source: Foreign Agriculture Service's Global Agricultural Trade System using data from the United Nations Statistical Office.
Notes: Listed commodities have the following six-digit codes from the Harmonized Tariff Schedule of the United States: softwood lumber, 440710;
  softwood, continuously shaped, 440910; softwood logs and poles, not treated, 440320; fuel wood, 440110; and railway ties, not impregnated, 440610.
  Continuously shaped softwood includes articles processed in various ways, such as wood molding. Many of these articles are ``manufactured,'' and
  therefore would not be affected by this proposed rule. Also, firewood included under the fuel wood category would not be affected by the proposed
  rule.

    Since potential effects of the proposed rule largely concern 
imports of unmanufactured wood articles from Mexico's border States, it 
is necessary to estimate their share of Mexico's exports to the United 
States. Using data obtained from U.S. ports of entry, we estimate that 
affected commodities worth about $31.3 million came from Mexico's 
border States in 1997, which is slightly more than one-third of the 
value of all shipments of these articles from Mexico (see table 2).
    El Paso, TX, is the principal port through which affected articles 
enter the United States. In 1997, approximately $81.7 million worth of 
these articles (89 percent of unmanufactured wood articles imported 
from Mexico) entered the United States through the port of El Paso. We 
estimate that 30 percent of these articles originated in Mexico's 
border States. Other U.S. border ports of entry report higher 
percentages coming from Mexico's border States--50 percent for Laredo, 
TX, and 100 percent for San Diego, CA, and Nogales, AZ--but the volumes 
of articles shipped were much smaller. Not surprisingly, most 
unmanufactured wood articles that enter through ports not near the 
United States/Mexico border (e.g., shipments by sea) originate from 
nonborder States in Mexico.

   Table 2.--Value of U.S. Imports of Unmanufactured Wood Articles From All of Mexico and From Mexican States
                              Adjacent to the United States, by Port of Entry, 1997
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                                                                               Estimated
                                                      Estimated value of     proportion of    Estimated value of
                                                       imports from all     shipments from       imports from
                 U.S. port of entry                        of Mexico        Mexico's border     Mexico's border
                                                           (dollars)            States         States (dollars)
                                                                             (percentage)
----------------------------------------------------------------------------------------------------------------
El Paso, TX.........................................          81,730,000                  30          24,519,000
San Diego, CA.......................................           5,551,000                 100           5,551,000
Laredo, TX..........................................           1,859,000                  50             929,500
Portland, OR........................................           1,021,000                   0                   0
San Francisco, CA...................................             735,000                   0                   0
Los Angeles, CA.....................................             591,000                   0                   0
Nogales, AZ.........................................             341,000                 100             341,000
Mobile, AL..........................................              80,000                   0                   0
                                                     -----------------------------------------------------------
    Total...........................................          91,908,000  ..................         31,340,500
----------------------------------------------------------------------------------------------------------------
Sources: Foreign Agriculture Service, Forest and Fishery Products Division, for the estimated values of imports;
  Plant Protection and Quarantine, APHIS, for the estimated proportion of shipments from Mexico's border States.
 
Note: Percentages of imports estimated as originating in Mexico's border states are based on numbers of
  shipments. Therefore, estimated values in the last column do not account for differences in shipment values.
  Available data does not permit a more accurate estimation of values. Also, shipments of unmanufactured
  hardwood articles that may be included in these values are assumed to be very minor.


[[Page 31516]]

    The significance of these levels of import can be put in 
perspective by comparing them to U.S. production and trade levels 
overall. Unmanufactured wood articles include a variety of commodities, 
but the value of softwood lumber production in the United States offers 
a reasonable basis for comparison, since the major timber species that 
would be affected by the proposed rule are pine and fir. When 
continuously shaped softwood articles are not considered, less than 2 
percent (about 1.4 percent) of unmanufactured softwood articles 
imported into the United States came from Mexico in 1997 (see table 1). 
Assuming imports contribute about one-third of total U.S. supply, 
imports from Mexico would, therefore, amount to about 0.5 percent of 
the U.S. supply of unmanufactured softwood articles. Further, if about 
one-third of Mexico's shipments originate in Mexico's border States, 
shipments from the border States would represent about 0.5 percent of 
unmanufactured softwood articles imported by the United States, or 
about 0.15 percent of U.S. supply.
    Mention should be made of SWPM, such as wooden pallets, crates, 
packing blocks, and dunnage. This packing material is used to prevent 
damage to cargo during shipment. Currently, SWPM originating in 
Mexico's border States and Canada may contain bark; SWPM entering the 
United States from anywhere else in the world must be without bark or 
be heat treated, fumigated, or treated with preservatives. In addition, 
SWPM from China has additional requirements (see Sec. 319.40-5(g)). The 
proposed rule would require that SWPM restrictions for Mexico's border 
States be the same as for the rest of the world except Canada and 
China.
    An informal survey of the ports of entry shown in table 2 found 
that a negligible amount of SWPM that is untreated or not free of bark 
enters the United States from Mexico. None is reported to enter through 
El Paso, TX, San Diego, CA, San Francisco, CA, Los Angeles, CA, or 
Nogales, AZ, and less than 1 percent is reported for Laredo, TX, and 
Portland, OR. (No contact was made with Mobile, AL.) Clearly, nearly 
all SWPM from Mexico's border States already meets the entry 
requirements that would be imposed by this proposed rule. Therefore, 
potential economic effects with respect to SWPM imports need not be 
given further consideration.

Economic Consequences

    Two parts of the proposed rule could have an impact on U.S. imports 
of unmanufactured wood articles from Mexico: (1) Adding methyl bromide 
fumigation as a treatment option for pine and fir lumber and railroad 
ties from Mexico; and (2) placing unmanufactured wood articles from 
Mexico's border States under the same treatment requirements, in 
general, as the rest of the Mexico.

Adding Methyl Bromide Fumigation Option for Pine and Fir Lumber and 
Railroad Ties

    For railroad ties from nonborder States of Mexico, current 
regulations require that the ties be completely debarked and either 
heat treated prior to importation or pressure treated within 30 days 
following importation. Under this proposed rule, fumigation would 
become an available treatment option. Virtually all railroad ties 
imported into the United States from Mexico are pressure treated for 
commercial reasons (i.e., in addition to eliminating pests, it protects 
the ties from decay). We expect that this would continue, and that few 
importers would utilize the proposed fumigation method. In order to 
comply with the wood subpart, importers may choose to fumigate railroad 
ties prior to importation if the railroad ties will be pressure treated 
beyond 30 days following importation. In any event, importations of 
railroad ties from Mexico represent a small percentage of total U.S. 
imports of railroad ties (6 percent of total U.S. imports, valued at 
$232,000). Therefore, we expect that adding methyl bromide fumigation 
as a treatment option would have very little or no impact on importers 
of railroad ties.
    For pine and fir lumber imported from nonborder States of Mexico, 
treatments available under the current regulations are heat treatment 
and heat treatment with moisture reduction. Under this proposed rule, 
fumigation would become an available treatment method. Kiln drying is a 
type of heat treatment with moisture reduction, and is the most common 
method used to treat lumber from Mexico. Kiln drying is used almost 
exclusively over other treatments for lumber because kiln drying is the 
industrial standard and it increases the economic value of the wood. 
For this reason, this analysis focuses on comparing the most common 
method, kiln drying, to the proposed alternative, methyl bromide 
fumigation.
    In 1997, softwood lumber imported from Mexico cost an average of 
$318 per cubic meter ($750.48 per thousand board feet), according to 
data compiled by the Foreign Agricultural Service, USDA. This figure is 
higher than average domestic unmanufactured green softwood prices of 
$137.71 per cubic meter ($325 per thousand board feet) in Northern 
California because: (1) Higher valued ponderosa pine constitutes a 
large percentage of imports from Mexico; (2)lumber imported from Mexico 
is mostly ``shop grade'' lumber, often used for making molding; (3) 
reported prices of lumber imported from Mexico may include delivery 
costs (F.O.B. delivered), whereas prices for domestic lumber do not 
(F.O.B. mill); and (4) some of the lumber imported from Mexico may 
already be kiln dried, which commands a higher price.\4\
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    \4\ Based on communication with the Foreign Agricultural 
Service, USDA.
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    Costs associated with kiln drying pine and fir lumber range between 
approximately $12 and $20 per cubic meter. In comparison, methyl 
bromide fumigation is reported to cost about one-third of this amount, 
or between $4.60 and $6.90 per cubic meter.\5\ There is not an 
appreciable difference in the time required to apply the two 
treatments. Methyl bromide fumigation of lumber requires 2 days for the 
actual treatment and up to 2 days for setup and dismantling and airing 
of the cargo. Kiln drying of lumber takes 3 to 4 days.
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    \5\ Estimated costs for kiln drying are based on communication 
with the Forest Products Laboratory, Forest Service, USDA. Estimated 
costs for fumigation are based on communications with fumigation 
companies operating at California ports and the Port of Baltimore.
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    At first glance, it would appear that there could be cost savings 
for Mexican exporters of pine and fir lumber to the United States--and 
potentially lower prices for U.S. importers--by replacing kiln drying 
with methyl bromide fumigation. However, kiln drying serves other 
commercial purposes besides satisfying phytosanitary requirements. U.S. 
importers may prefer kiln dried lumber, whereby fumigation would only 
result in an unnecessary additional cost. Information is not available 
to estimate the percentage of imports that would be fumigated instead 
of kiln dried.
    Irrespective of the proposed addition of methyl bromide as a 
treatment option, any potential costs of this proposed rule for 
producers and consumers in the United States are likely to be very 
minor. As discussed above, the value of softwood lumber imported from 
Mexico is estimated to be only 0.5 percent of the value of the U.S. 
supply of softwood lumber. If it happens that kiln drying remains the 
preferred treatment alternative after fumigation is allowed, most 
shipments of pine and fir lumber imported into the United States from 
nonborder States of Mexico would not be affected.

[[Page 31517]]

No Longer Exempting Unmanufactured Wood Articles From Mexico's 
Border States

    As a result of this proposed rule, unmanufactured wood articles 
from Mexico's border States would be subject to the same importation 
and entry requirements as unmanufactured wood articles from the rest of 
Mexico (except for mesquite wood for cooking and firewood and small, 
noncommercial packages of unmanufactured wood for personal cooking or 
medicinal purposes). This change would have its primary impact on 
softwood lumber, which constitutes the vast majority of all 
unmanufactured wood articles imported from Mexico's border States.
    Currently, softwood lumber from Mexico's border States can be 
imported without restriction, provided that the lumber was derived from 
trees harvested in Mexico's border States and has never been moved 
outside those States. Under this proposal, lumber from Mexico's border 
States would have to be either heat treated, heat treated with moisture 
reduction, or fumigated with methyl bromide. As with lumber from the 
rest of Mexico, the most likely treatments chosen would be kiln drying, 
at a cost of $12 to $20 per cubic meter, or methyl bromide fumigation, 
which could be done for, at most, one-third the cost of kiln drying.
    As stated previously in this document, the total value of 
unmanufactured wood articles imported from Mexico's border States in 
1997 was approximately $31.3 million; almost all of these imports were 
softwood lumber. If we assume that all unmanufactured wood articles 
imported from Mexico's border States are untreated, and would be kiln 
dried or fumigated to comply with this proposed rule, the impact of 
requiring treatment would range between $565,000 and $1.6 million, 
depending on whether most importers choose to kiln dry or fumigate the 
wood. (This calculation was made by first assuming that all 
unmanufactured wood articles imported from Mexico's border States in 
1997 were softwood lumber, and then by using the value of $318 per 
cubic meter of softwood lumber to arrive at a total of 98,428 cubic 
meters of softwood lumber imported from Mexico's border States, 
multiplied by the midpoint in the range of costs for kiln drying and 
fumigation.)
    Some of the lumber imported from Mexico's border States may already 
be kiln dried and would not require additional treatment as a result of 
this proposed rule. We do not have data to estimate the quantity of 
lumber imports from Mexico's border States that is already kiln dried 
nor what percentage of imports would be fumigated rather than kiln 
dried under this proposal. We welcome public comments with information 
that would help us more precisely estimate total potential treatment 
costs.
    This proposed rule would result in small additional cost for an 
extremely small fraction of the U.S. supply of unmanufactured softwood 
articles. The benefit of the proposed rule is greater protection of 
U.S. forests. The potential for exotic pest introduction via imports of 
unmanufactured wood articles necessitates rigorous mitigation measures. 
The cost to producers and consumers could range in the millions of 
dollars if these measures are not taken.\6\ The cost of treating 
unmanufactured wood articles imported from Mexico's border States is 
small, compared to the possible consequences of not changing existing 
regulations.
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    \6\ Estimates of economic losses if representative insects and 
pathogens of concern were introduced into the United States are in 
the ``Pest Risk Assessment of the Importation into the United States 
of Unprocessed Pinus and Abies Logs from Mexico,'' referred to 
previously in this document. Estimated costs of introduction range 
from less than $1 million to more than $50 million, depending on the 
pest. To obtain copies of this pest risk assessment, see the 
instructions under footnote 1 of this document.
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Regulatory Flexibility Analysis

    The Regulatory Flexibility Act requires that APHIS specifically 
consider the economic impact of the proposed rule on small entities. 
The Small Business Administration (SBA) has established size criteria 
by Standard Industrial Classification for determining which economic 
entities meet the definition of a small firm. Data from the SBA was 
used to estimate the number of small entities potentially affected by 
this proposed rule.
    The proposed rule would add a treatment option for railroad ties 
and pine and fir lumber from Mexico, and would add treatment and 
handling requirements for logs, lumber, and other unmanufactured wood 
articles imported from States in Mexico adjacent to the U.S. border. 
Entities most likely to be affected by the proposed rule are those that 
import pine and fir lumber. These entities include sawmills, lumber 
wholesalers, lumber retailers, wood article manufacturers, and general 
contractors of home construction. The SBA classifies sawmills and wood 
article manufacturers as small entities if fewer than 500 people are 
employed. Wood wholesalers and retailers are considered small with 
fewer than 100 employees. A general contractor is considered small with 
annual receipts of less than $17 million.
    The number, size, and location of entities that actually import 
pine and fir lumber from Mexico could not be quantified by APHIS. 
According to SBA data, there are about 177,014 entities in these 
potentially affected industries. More than 87 percent of these firms, 
between approximately 154,029 and 155,447, are classified as small 
according to SBA criteria. Thus, the majority of firms likely to be 
affected by this proposed rule would be small entities. It is presumed 
that the majority of these entities would be ones located in the 
southwestern United States.
    Given the small fraction of the U.S. supply of unmanufactured wood 
articles imported from Mexico, and the even smaller percentage 
originating in Mexico's border States, we expect that the effect of 
this proposed rule on small entities in the United States would be 
negligible. If the proposal is adopted, and kiln dried imports from 
nonborder States are instead fumigated, cost savings may be partly 
realized by U.S. buyers through lower prices. For imports from Mexico's 
border States, costs to U.S. buyers may increase due to the new 
treatment requirements. But as discussed above, treatment costs are a 
small fraction of total product costs, so any impact, negative or 
beneficial, would be slight.
    Under these circumstances, the Administrator of the Animal and 
Plant Health Inspection Service has determined that this action would 
not have a significant economic impact on a substantial number of small 
entities.

Executive Order 12988

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. If this proposed rule is adopted: (1) All State 
and local laws and regulations that are inconsistent with this rule 
will be preempted; (2) no retroactive effect will be given to this 
rule; and (3) administrative proceedings will not be required before 
parties may file suit in court challenging this rule.

National Environmental Policy Act

    We have prepared an environmental assessment for this proposed 
rule. The assessment provides a preliminary basis for the conclusion 
that the importation of unmanufactured wood articles from Mexico under 
the conditions specified in this proposed rule would reduce the risk of 
introducing or disseminating plant pests and would not have a 
significant impact on the quality of the human environment.
    We prepared the environmental assessment in accordance with: (1) 
The

[[Page 31518]]

National Environmental Policy Act of 1969, as amended (NEPA) (42 U.S.C. 
4321 et seq.), (2) regulations of the Council on Environmental Quality 
for implementing the procedural provisions of NEPA (40 CFR parts 1500-
1508), (3) USDA regulations implementing NEPA (7 CFR part 1b), and (4) 
APHIS' NEPA Implementing Procedures (7 CFR part 372).
    Copies of the environmental assessment are available for public 
inspection at USDA, room 1141, South Building, 14th Street and 
Independence Avenue SW., Washington, DC, between 8 a.m. and 4:30 p.m., 
Monday through Friday, except holidays. Persons wishing to inspect 
copies are requested to call ahead on (202) 690-2817 to facilitate 
entry into the reading room. In addition, copies may be obtained by 
writing to the individual listed under FOR FURTHER INFORMATION CONTACT.
    We invite you to comment on all aspects of this proposed rule, 
including the environmental assessment. For information on when and 
where to send your comments, please refer to the DATES and ADDRESSES 
sections near the beginning of this document.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501 et seq.), the information collection or recordkeeping requirements 
included in this proposed rule have been approved by the Office of 
Management and Budget (OMB). The forms that we are proposing to require 
for the importation into the United States of certain unmanufactured 
wood articles from the adjacent States in Mexico have been approved by 
OMB for the importation of unmanufactured wood articles from other 
areas of Mexico and other countries. The time that would be needed for 
the completion of forms under this proposal is included in the 
paperwork hours approved by OMB for the affected CFR sections. The 
assigned OMB control number is 0579-0119.

List of Subjects in 7 CFR Part 319

    Bees, Coffee, Cotton, Fruits, Honey, Imports, Incorporation by 
reference, Nursery stock, Plant diseases and pests, Quarantine, 
Reporting and recordkeeping requirements, Rice, Vegetables.

    Accordingly, we propose to amend 7 CFR part 319 as follows:

PART 319--FOREIGN QUARANTINE NOTICES

    1. The authority citation for part 319 would continue to read as 
follows:

    Authority: 7 U.S.C. 150dd, 150ee, 150ff, 151-167, 450, 2803, and 
2809; 21 U.S.C. 136 and 136a; 7 CFR 2.22, 2.80, and 371.2(c).

    2. In Sec. 319.40-3, paragraph (a) would be amended as follows:


Sec. 319.40-3  General permits; articles that may be imported without a 
specific permit; articles that may be imported without either a 
specific permit or an importer document.

    (a) Canada and Mexico. (1) The following articles may be imported 
into the United States under general permit:
    (i) From Canada: Regulated articles, other than regulated articles 
of the subfamilies Aurantioideae, Rutoideae, and Toddalioideae of the 
botanical family Rutaceae; and
    (ii) From States in Mexico adjacent to the United States: 
Commercial and noncommercial shipments of mesquite wood for cooking and 
firewood, and small, noncommercial packages of unmanufactured wood for 
personal cooking or personal medicinal purposes.
    (2) Commercial shipments allowed in paragraph (a)(1) of this 
section are subject to the inspection and other requirements in 
Sec. 319.40-9 and must be accompanied by an importer document stating 
that they are derived from trees harvested in Canada or States in 
Mexico adjacent to the United States border.
* * * * *
    3. In Sec. 319.40-5, paragraph (f) would be amended by adding the 
words ``at a U.S. facility under compliance agreement with APHIS'' 
immediately before the period, and a new paragraph (l) will be added to 
read as follows:


Sec. 319.40-5  Importation and entry requirements for specified 
articles.

* * * * *
    (l) Railroad ties and pine and fir lumber from Mexico. Cross-ties 
(railroad ties) 8 inches or less at maximum thickness and lumber 
derived from pine and fir may be imported from Mexico into the United 
States if they:
    (1) Originate from Mexico;
    (2) Are 100 percent free of bark; and
    (3) Are fumigated prior to arrival in the United States. The 
regulated article and the ambient air must be a temperature of 5  deg.C 
or above throughout fumigation. The fumigation must be conducted using 
schedule T-312 contained in the Treatment Manual. In lieu of the 
schedule T-312 methyl bromide concentration, fumigation may be 
conducted with an initial methyl bromide concentration of at least 240 
g/m3 with exposure and concentration levels adequate to 
provide a concentration-time product of at least 17,280 gram-hours 
calculated on the initial methyl bromide concentration.

    Done in Washington, DC, this 7th day of June 1999.
Craig A. Reed,
Administrator, Animal and Plant Health Inspection Service.
[FR Doc. 99-14844 Filed 6-10-99; 8:45 am]
BILLING CODE 3410-34-P