[Federal Register Volume 65, Number 216 (Tuesday, November 7, 2000)]
[Rules and Regulations]
[Pages 66601-66604]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-28333]



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  Federal Register / Vol. 65, No. 216 / Tuesday, November 7, 2000 / 
Rules and Regulations  

[[Page 66601]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 905 and 944

[Docket No. FV00-905-2 FR]


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: Final rule.

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

SUMMARY: This rule relaxes the 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 allows handlers and importers to ship size 56 red seedless 
grapefruit, and is expected to maximize grapefruit shipments to fresh 
market channels.

EFFECTIVE DATE: November 13, 2000.

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 final 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 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 final 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 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 final rule relaxes the minimum size requirement for domestic 
shipments from size 48 (3\9/16\ inches in diameter) to size 56 (3\5/16\ 
inches in diameter). Absent this change, the minimum size reverts to 
size 48 (3\9/16\ inches in diameter) on November 13, 2000. This change 
allows 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

[[Page 66602]]

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 enables Florida grapefruit shippers to 
continue shipping size 56 red seedless grapefruit to the domestic 
market. This rule is expected to have a beneficial impact on producers 
and handlers because it permits 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 maximizes 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 current 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 pertains to the domestic market, and does 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 will be favorably affected by this change since the 
relaxation of the minimum size regulation also applies 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 will 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 relaxes 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 figure. 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 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 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 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

[[Page 66603]]

handlers handled 70 percent of Florida grapefruit shipments. In 
addition, many of those 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 rule relaxes 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 will 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 allows 
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 provides 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 is expected to have a positive impact on affected 
entities. This rule benefits producers and handlers by making available 
those sizes of fruit needed to meet consumer needs. This is consistent 
with current and anticipated demand, and provides 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 changes the minimum size for domestic red seedless grapefruit 
shipments, a similar change is also applicable to imported grapefruit. 
Therefore, this rule also relaxes the minimum size for imported red 
seedless grapefruit to size 56. This regulation benefits importers to 
the same extent that it benefits Florida grapefruit producers and 
handlers because it continues 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 preferred 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 final rule relaxes size requirements under the marketing order 
for Florida citrus. Accordingly, this action will 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 final 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). Further, no public comments were received 
concerning the proposal which addressed the initial regulatory 
flexibility analysis.
    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 views on this issue.
    A proposed rule concerning this action was published in the Federal 
Register on October 2, 2000 (65 FR 58672). Copies of the rule were 
mailed or sent via facsimile to all Committee members and red seedless 
grapefruit handlers. Finally, the rule was made available through the 
Internet by the Office of the Federal Register. A 15-day comment period 
ending October 17, 2000, was provided to allow interested persons to 
respond to the proposal. No comments were received during the comment 
period in response to the proposal. Accordingly, no changes will be 
made to the rule as proposed.
    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 final rule.
    After consideration of all relevant matter presented, including the 
information and recommendation submitted by the Committee and other 
available information, it is hereby found that this rule, as 
hereinafter set forth, will tend to effectuate the declared policy of 
the Act.
    It is further found that good cause exists for not postponing the 
effective date of this rule until 30 days after publication in the 
Federal Register (5 U.S.C. 553) so handlers and importers can continue 
to ship size 56 red seedless grapefruit after November 12, 2000. 
Further, handlers are aware of this relaxation, which was recommended 
at a public meeting. Also, a 15-day comment period was provided for in 
the proposed rule and no comments were received.

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 part 905 and 944 are amended 
as follows:

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


[[Page 66604]]


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

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

    2. In Sec. 905.306, the table in paragraph (a) is amended by 
removing both lines for the entry for ``Seedless, red'' and adding in 
their place the following:


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..................      \35/16\
 
*                  *                  *                  *                  *                  *
                                                        *
----------------------------------------------------------------------------------------------------------------

PART 944--FRUITS; IMPORT REGULATIONS

    3. In Sec. 944.106, the table in paragraph (a) is amended by 
removing both lines for the entry for ``Seedless, red'' and adding in 
their place the following:


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..................      \35/16\
*                  *                  *                  *                  *                  *
                                                        *
----------------------------------------------------------------------------------------------------------------


    Dated: October 31, 2000.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 00-28333 Filed 11-6-00; 8:45 am]
BILLING CODE 3410-02-P