[Federal Register Volume 65, Number 191 (Monday, October 2, 2000)]
[Proposed Rules]
[Pages 58672-58675]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-25188]


 ========================================================================
 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. 65, No. 191 / Monday, October 2, 2000 / 
Proposed Rules  

[[Page 58672]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 905 and 944

[Docket No. FV00-905-2 PR]


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

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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

SUMMARY: This rule would relax minimum size requirements for red 
seedless grapefruit grown in Florida 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). The Citrus Administrative 
Committee (Committee), the agency that locally administers the 
marketing order for oranges, grapefruit, tangerines, and tangelos grown 
in Florida, recommended this change for Florida red seedless 
grapefruit. The change in the import regulation is required under 
section 8e of the Agricultural Marketing Agreement Act of 1937. This 
change would allow handlers and importers to ship size 56 red seedless 
grapefruit, and is expected to maximize grapefruit shipments to fresh 
market channels.

DATES: Comments must be received by October 17, 2000.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposal. Comments must be sent to the Docket Clerk, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA, room 2525-S, P.O. Box 96456, Washington, DC 20090-6456; Fax: 
(202) 720-5698, 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 available for public 
inspection in the Office of the Docket Clerk during regular business 
hours, or can be viewed at: http://www.ams.usda.gov/fv/moab/html.

FOR FURTHER INFORMATION CONTACT: Doris Jamieson, Marketing Specialist, 
Southeast Marketing Field Office, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, P.O. Box 2276, Winter 
Haven, Florida 33883; telephone: (863) 299-4770, Fax: (863) 299-5169; 
or George Kelhart, Technical Advisor, 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) 
720-5698.
    Small businesses may request information on complying with this 
regulation by contacting Jay Guerber, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, P.O. Box 96456, room 
2525-S, Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: 
(202) 720-5698, or E-mail: [email protected].

SUPPLEMENTARY INFORMATION: This proposed 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 proposed rule also is issued under section 8e of the Act, 
which provides that whenever certain 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 proposed rule 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.
    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 12, 2000, and size 48 (3\9/16\ inches in diameter), 
thereafter. The current minimum size for export shipments is size 56 
throughout the year.
    This proposed rule invites comments on a change to the order's 
rules and regulations that would relax the minimum size requirement for 
domestic shipments of red seedless grapefruit. This rule would relax 
the minimum size from size 48 (3\9/16\ inches in diameter) to size 56 
(3\5/16\ inches in diameter).

[[Page 58673]]

Absent this change, the minimum size would revert to size 48 (3\9/16\ 
inches in diameter) on November 13, 2000. This change would allow 
handlers and importers to continue to ship size 56 red seedless 
grapefruit, and it is expected to maximize grapefruit shipments to 
fresh market channels. The Committee met on May 26, 2000, 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 part 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 rule adjusts Table I to establish a minimum size of 
56 (3\5/16\ inches diameter). Minimum grade and size requirements for 
grapefruit imported into the United States are currently in effect 
under Sec. 944.106 (7 CFR part 944.106). This rule also adjusts 
Sec. 944.106 to establish a minimum size of 56. Export requirements for 
Florida red seedless grapefruit are not changed by this rule.
    In the past, the Committee recommended relaxing the minimum size 
for red seedless grapefruit to size 56 in one year intervals. Rather 
than continuing to make this recommendation each year, the Committee 
recommended relaxing the minimum size for red seedless grapefruit from 
size 48 (3\9/16\ inches in diameter) to size 56 (3\5/16\ inches in 
diameter) on a continuous basis. In making this recommendation, the 
Committee recognized that the reasoning behind past recommendations to 
relax the minimum size to size 56 would most probably continue to exist 
at least into the foreseeable future.
    As in the past, the Committee considered supply and demand in 
making its recommendation. Since the 1994-95 season, the production of 
red seedless grapefruit has been somewhere between 28.1 and 31.4 
million 1\3/5\ bushel boxes each year. Future production is expected to 
be near or below this range.
    The Committee expects fresh market demand to continue to be 
sufficient to permit the shipment of size 56 red seedless grapefruit. 
The Committee believes that domestic markets have been developed for 
size 56 fruit and that the industry should continue to supply those 
markets. This size relaxation would enable Florida grapefruit shippers 
to continue shipping size 56 red seedless grapefruit to the domestic 
market. This rule would have a beneficial impact on producers and 
handlers because it would permit Florida grapefruit handlers to make 
available the sizes of fruit needed to meet consumer needs. Matching 
the sizes with consumer needs is consistent with current and 
anticipated demand, and would maximize shipments to fresh market 
channels.
    For the grapefruit industry, it is important to maximize shipments 
to the fresh market. This is especially true for red seedless 
grapefruit because the returns for processing are negligible. On-tree 
returns for processed red seedless grapefruit averaged $.17 per 1\3/5\ 
bushel box from 1994 through 1999. In many cases, this is below the 
cost of production. Comparatively, the average on-tree return is $3.32 
for fresh shipments during the same period.
    For the years 1994 through 1999, fresh domestic shipments of red 
seedless grapefruit averaged 16.7 million \4/5\ bushel cartons per 
season. Of these shipments, approximately 2.9 percent were size 56. The 
average f.o.b. price for size 56 red seedless grapefruit was $5.22 
during the 1998-99 season. Combining this price with the average volume 
of size 56 calculates an approximate market value of $2.5 million for 
size 56 red seedless grapefruit.
    During the first 11 weeks of the season, beginning with the third 
week in September, the Committee has been using a volume regulation to 
limit the volume of small red seedless grapefruit that can enter the 
fresh market. The Committee has used this regulation for the past three 
seasons, and has recommended using it again for the upcoming season. 
The Committee believes the percentage size regulation has been helpful 
in reducing the negative effects of having size 56 red seedless 
grapefruit available on the domestic market, and that no other 
restrictions on size 56 are needed.
    Therefore, 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. This minimum size 
change would pertain to the domestic market, and would not change the 
minimum size for export shipments, which will remain at size 56. The 
largest market for size 56 red seedless grapefruit is for export. 
Additionally, importers would be favorably affected by this change 
since the relaxation of the minimum size regulation would 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 would relax the minimum size requirement under the domestic 
handling regulations, a corresponding change to the import regulations 
must also be considered.
    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 rule would relax the minimum size requirement for 
imported red seedless grapefruit to 3\5/16\ inches in diameter (size 
56), to reflect the relaxation being made under the order for red 
seedless grapefruit grown in Florida.
    Handlers in Florida shipped approximately 33,650,000 \4/5\ bushel 
cartons of grapefruit to the fresh market during the 1999-2000 season. 
Of these cartons, about 18,463,000 were exported. In the past three 
seasons, domestic shipments of Florida grapefruit averaged about 
16,172,000 cartons. Imports totaled about 456,470 cartons in 1999. 
Imports account for less than five percent of domestic grapefruit 
shipments.
    During the period January 1, 1999, through December 31, 1999, 
imports of grapefruit totaled 19,400,000 pounds (approximately 456,470 
cartons). Recent yearly data indicate that imports from May through 
November are typically negligible. Future imports should not vary 
significantly from the 19,400,000 pounds. The Bahamas were the 
principal source of imported grapefruit, accounting for 93 percent of 
the total. Israel, Mexico and Turkey supplied remaining imports. Most 
imported grapefruit enters the United States from November through May.
    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 grapefruit handlers who are subject to 
regulation under the order, and approximately 11,000 growers of citrus 
in the regulated

[[Page 58674]]

area, and about 25 grapefruit importers. Small agricultural service 
firms, which include grapefruit handlers and importers, are defined by 
the Small Business Administration (13 CFR 121.201) 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.
    Based on the industry and Committee data for the 1999-2000 season, 
the average annual f.o.b. price for fresh Florida red seedless 
grapefruit was around $7.52 per \4/5\ bushel carton, and total fresh 
shipments for the 1999-2000 season are estimated at 25.6 million 
cartons of red seedless grapefruit. Approximately 25 percent of all 
handlers handled 70 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 69 percent 
of grapefruit handlers could be considered small businesses under SBA's 
definition. The majority of handlers, importers, and growers may be 
classified as small entities.
    During the period January 1, 1999, through December 31, 1999, 
imports of grapefruit totaled 19,400,000 pounds (approximately 456,470 
cartons). Recent yearly data indicate that imports from May through 
November are typically negligible. Future imports should not vary 
significantly from the 19,400,000 pounds. The Bahamas were the 
principal source of imported grapefruit, accounting for 93 percent of 
the total. Israel, Mexico, and Turkey supplied remaining imports. Most 
imported grapefruit enters the United States from November through May.
    This proposed rule would relax the minimum size requirement for 
domestic shipments of red seedless grapefruit from size 48 (3-9/16 
inches in diameter) to size 56 (3-5/16 inches in diameter). Absent this 
rule, the minimum size requirement for domestic shipments would revert 
to size 48 on November 13, 2000. The Committee believes that domestic 
markets have been developed for size 56 red seedless grapefruit and 
that the industry should continue to supply those markets. This change 
would allow handlers and importers to continue to ship size 56 red 
seedless grapefruit, and it is expected to maximize shipments to fresh 
market channels. The Committee unanimously recommended this action. 
Section 905.306 specifies the minimum grade and size requirements for 
different varieties of fresh Florida grapefruit. Authority for this 
action is provided in Sec. 905.52 of the order.
    This action would provide for the continued shipment of size 56 red 
seedless grapefruit. This change is not expected to increase costs 
associated with the order requirements, or the grapefruit import 
regulation. This rule would have a positive impact on affected 
entities. This rule would benefit producers and handlers by making 
available those sizes of fruit needed to meet consumer needs. This is 
consistent with current and anticipated demand, and would provide for 
the maximization of shipments to fresh market channels. 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.
    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 would change the minimum size for domestic red seedless 
grapefruit shipments, a similar change would also be applicable to 
imported grapefruit. Therefore, this rule would also relax the minimum 
size for imported red seedless grapefruit to size 56. This regulation 
would benefit importers to the same extent that it would benefit 
Florida grapefruit producers and handlers because it would continue to 
allow shipments of size 56 red seedless grapefruit into U.S. markets.
    The Committee considered one alternative to this action. The 
Committee discussed relaxing the minimum size to size 56 for one year, 
as in the past, rather than on a continuous basis. Members said that, 
rather than discussing the issue each year and recommending a change, 
they would prefer to make the change effective on a continuous basis. 
They also stated that should they ever want to increase the minimum 
size, they could meet and recommend the change to the Secretary. 
Therefore, the option of relaxing the minimum size for one year was 
rejected.
    This proposed rule would relax size requirements under the 
marketing order for Florida citrus. Accordingly, this action would not 
impose any additional reporting or recordkeeping requirements on either 
small or large red seedless grapefruit handlers and importers. 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, red 
seedless grapefruit must meet the requirements as specified in the U.S. 
Standards for Grades of Florida Grapefruit (7 CFR 51.750 through 
51.784) 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 Florida 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 26, 
2000, meeting was a public meeting and all entities, both large and 
small, were able to express their views on this issue. Finally, 
interested persons are invited to submit information on the regulatory 
and informational impacts of this action on small businesses.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/fv/moab.html. Any questions about the compliance 
guide should be sent to Jay Guerber at the previously mentioned address 
in the FOR FURTHER INFORMATION CONTACT section.
    In accordance with section 8e of the Act, the United States Trade 
Representative has concurred with the issuance of this proposed rule.
    A 15-day comment period is provided to allow interested persons to 
respond to this proposal. Fifteen days is deemed appropriate because 
this rule would need to be in place on November 13, 2000. This action 
is similar to those recommended in previous seasons, and it was 
unanimously recommended by the Committee. All written comments timely 
received will be considered before a final determination is made on 
this matter.

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.
    For the reasons set forth above, 7 CFR Parts 905 and 944 are 
proposed to be amended as follows:
    1. The authority citation for 7 CFR part 905 continues to read as 
follows:

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

[[Page 58675]]

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

    2. In Sec. 905.306, the table in paragraph (a) is amended by 
revising the entry for ``Seedless, red'' to read as follows:


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

    (a) * * *

                                                     Table I
----------------------------------------------------------------------------------------------------------------
                                                                                                       Minimum
                 Variety                        Regulation period              Minimum grade           Diameter
                                                                                                       (Inches)
----------------------------------------------------------------------------------------------------------------
(1)                                        (2)........................  (3)........................          (4)
GRAPEFRUIT
 
*                  *                  *                  *                  *                  *
                                                        *
Seedless, Red............................  On and after 11/13/00......  U.S. No. 1.................       3-5/16
 
*                  *                  *                  *                  *                  *
                                                        *
----------------------------------------------------------------------------------------------------------------

PART 944--FRUITS; IMPORT REGULATIONS

    3. In Sec. 944.106, the table in paragraphs (a) is amended by 
revising the entry for ``Seedless, red'' to read as follows:


Sec. 944.106  Grapefruit import regulation.

    (a) * * *

 
----------------------------------------------------------------------------------------------------------------
                                                                                                       Minimum
        Grapefruit classification               Regulation period              Minimum grade           diameter
                                                                                                       (inches)
----------------------------------------------------------------------------------------------------------------
(1)                                        (2)........................  (3)........................          (4)
 
 
*                  *                  *                  *                  *                  *
                                                        *
Seedless, red............................  On and after 11/13/00......  U.S. No. 1.................       3-5/16
 
*                  *                  *                  *                  *                  *
                                                        *
----------------------------------------------------------------------------------------------------------------


    Dated: September 27, 2000.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 00-25188 Filed 9-27-00; 4:21pm]
BILLING CODE 3410-02-P