[Federal Register Volume 69, Number 72 (Wednesday, April 14, 2004)]
[Rules and Regulations]
[Pages 19753-19756]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-8522]



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 Rules and Regulations
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  Federal Register / Vol. 69, No. 72 / Wednesday, April 14, 2004 / 
Rules and Regulations  

[[Page 19753]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 916 and 917

[Docket No. FV04-916/917-02 IFR]


Nectarines and Peaches Grown in California; Revision of Handling 
Requirements for Fresh Nectarines and Peaches

AGENCY: Agricultural Marketing Service, USDA

ACTION: Interim final rule with request for comments.

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SUMMARY: This rule revises the handling requirements for California 
nectarines and peaches by reducing the minimum net weight for shipments 
of nectarines and peaches in bulk bins under the marketing orders. The 
marketing orders regulate the handling of nectarines and peaches grown 
in California and are administered locally by the Nectarine 
Administrative and Peach Commodity Committees (committees). This rule 
would enable packers to continue shipping fresh nectarines and peaches 
meeting customers' needs in the interests of producers, packers, and 
consumers of these fruits.

DATES: Effective April 15, 2004. Comments received by June 14, 2004, 
will be considered prior to issuance of any final rule.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent to the Docket Clerk, Fruit 
and Vegetable Programs, AMS, USDA, 1400 Independence Avenue, SW., STOP 
0237, Washington, DC 20250-0237; fax: (202) 720-8938, or e-mail: 
[email protected] or http://www.regulations.gov. All comments 
should reference the docket number and the date and page number of this 
issue of the Federal Register and will be made available for public 
inspection at 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: Terry Vawter, Marketing Specialist, 
California Marketing Field Office, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, 2202 Monterey Street, 
suite 102B, Fresno, California, 93721; telephone (559) 487-5901, fax: 
(559) 487-5906; or George Kelhart, Technical Advisor, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 
Independence Avenue, SW., STOP 0237, Washington, DC 20250-0237; 
telephone: (202) 720-2491; fax: (202) 720-8938.
    Small businesses may request information on complying with this 
regulation by contacting Jay Guerber, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence 
Avenue, SW., STOP 0237, Washington, DC 20250-0237; telephone: (202) 
720-2491, fax: (202) 720-8938, or e-mail: [email protected].

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement Nos. 124 and 85, and Marketing Order Nos. 916 and 917 (7 CFR 
parts 916 and 917) regulating the handling of nectarines and peaches 
grown in California, respectively, hereinafter referred to as the 
``orders.'' The orders are effective under the Agricultural Marketing 
Agreement Act of 1937, as amended (7 U.S.C. 601-674), hereinafter 
referred to as the ``Act.''
    The Department of Agriculture (USDA) is issuing this rule in 
conformance with Executive Order 12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule is not intended to have retroactive effect. 
This rule will not preempt any State or local laws, regulations, or 
policies, unless they present an irreconcilable conflict with this 
rule.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 608c(15)(A) of the 
Act, any handler subject to an order may file with USDA 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, USDA would rule in 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 USDA's ruling on the petition, 
provided an action is filed not later than 20 days after the date of 
the entry of the ruling.
    Under the orders, container and pack requirements are established 
for fresh shipments of California nectarines and peaches. Such 
requirements are in effect on a continuing basis. The Nectarine 
Administrative Committee (NAC) and the Peach Commodity Committee (PCC), 
which are responsible for local administration of the orders, met on 
February 25, 2004, and unanimously recommended that the handling 
requirements be further revised for the 2004 season, which begins in 
April. The committees unanimously recommended that the minimum net 
weight for loose-filled bulk bin containers be reduced from 400 pounds 
to 100 pounds.
    The committees meet prior to and during each season to review the 
rules and regulations effective on a continuing basis for California 
nectarines and peaches under the orders. Committee meetings are open to 
the public and interested persons are encouraged to express their views 
at these meetings. The committees held such meetings on February 25, 
2004.
    USDA reviews committee recommendations and information, as well as 
information from other sources, and determines whether modification, 
suspension, or termination of the rules and regulations would tend to 
effectuate the declared policy of the Act.
    No official crop estimate was available at the time of the 
committees' meetings because the nectarine and peach trees were dormant 
at the time. The committees will recommend a crop estimate at their 
meetings in April. However, preliminary estimates indicate that the 
2004 crop will be similar in size and characteristics to the 2003 crop, 
which totaled 21,869,300 containers of nectarines and 22,306,300 
containers of peaches.

[[Page 19754]]

Container and Pack Requirements

    Sections 916.52 and 917.41 of the orders authorize establishment of 
container, pack, and container marking requirements for shipments of 
nectarines and peaches, respectively. Under Sec. Sec.  916.350 and 
917.442 of the orders' rules and regulations, container markings, net 
weights, well-filled requirements, weight-count standards for various 
sizes of nectarines and peaches, and standard containers are specified. 
Included in the container and pack requirements are minimum net weight 
requirements for several containers, such as the bulk bin.
    Currently, the minimum net weight for bulk bin containers is 400 
pounds. At the request of a handler, the committees unanimously 
recommended that the minimum net weight be reduced to 100 pounds for 
bulk bin containers of loose-filled nectarines and peaches.
    The committees' recommendations resulted from a recommendation by 
the Tree Fruit Quality Subcommittee. At the subcommittee meeting on 
February 4, 2004, a handler requested that the current minimum net 
weight be reviewed and possibly modified. The handler noted that it had 
increased shipments of bulk peaches during the 2003 season, but found 
that the minimum net weight of 400 pounds too restrictive because the 
weight of the fruit in the bin damages the contents, especially the 
peaches at the bottom of the bin. The handler suggested that a minimum 
weight of 200 pounds might serve the industry better by ensuring the 
safe arrival of the fruit.
    The subcommittee discussed shipments of nectarines and peaches in 
bulk bins, and reviewed the historical significance of the minimum net 
weight of 400 pounds. The subcommittee determined that the net weight 
was set in 1976 when there were few, if any, bulk bin shipments.
    The subcommittee also deliberated the relative value of different 
minimum weights; e.g. 125 pounds, 200 pounds, or 100 pounds. They 
determined that since the weight constituted a minimum net weight 
rather than maximum net weight, it was prudent to use a weight that was 
lighter than currently established, but still heavy enough to 
constitute a bulk shipment. Since it would be difficult for a handler 
to pack a 100-pound box for anything other than a bulk bin shipment, 
the 100 minimum net weight was determined to be the optimum net weight 
and was unanimously recommended. The subcommittee further unanimously 
recommended that the 100-pound minimum net weight be in place for the 
2004 season only, with a review of the success of the modification at 
the end of the season.
    The committees discussed the Tree Fruit Quality subcommittee's 
recommendation at the February 25, 2004, meeting and reviewed the 
current industry practices regarding shipping in bulk bin containers. 
While use of bulk bins appears to be in its infancy, the committees 
appreciate that such shipments could constitute a new trend, and that 
relaxing the current minimum net weight for those containers provides 
yet another marketing opportunity for handlers. Moreover, the reduced 
minimum net weight will provide another container option for handlers 
and safeguard the fruit in the container from bruising. However, the 
committees disagreed with the subcommittee's recommendation that the 
change should be in place for the 2004 season only, and did not believe 
it necessary to review the use of these containers at the end of the 
2004 season.
    For the reasons stated above, the committees recommended that the 
minimum net weight for loose-filled bulk bin containers of nectarines 
and peaches be decreased from the current 400 pounds to 100 pounds.
    Nectarines: 1 For the reasons stated above, paragraph (a)(9) of 
Sec.  916.350 is revised to modify the minimum net weight of bulk bin 
containers of loose-filled nectarines from 400 pounds to 100 pounds. 
The required container markings shall be placed on one outside end of 
the container in plain sight and in plain letters.
    Peaches: For the reasons stated above, paragraph (a)(10) of Sec.  
917.442 is revised to modify the minimum net weight of bulk bin 
containers of loose-filled peaches from 400 pounds to 100 pounds. The 
required container markings shall be placed on one outside end of the 
container in plain sight and in plain letters.

Initial Regulatory Flexibility Analysis

    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.

Industry Information

    There are approximately 250 California nectarine and peach packers 
subject to regulation under the orders covering nectarines and peaches 
grown in California, and about 1,800 producers of these fruits in 
California. The Small Business Administration (13 CFR 121.201) defines 
small agricultural service firms as those whose annual receipts are 
less than $5,000,000. The Small Business Administration also defines 
small agricultural producers as those having annual receipts of less 
than $750,000. A majority of these packers and producers may be 
classified as small entities.
    The committees' staff has estimated that there are less than 20 
handlers in the industry who could be defined as other than small 
entities. In the 2003 season, the average handler price received was 
$7.00 per container or container equivalent of nectarines or peaches. A 
handler would have to ship at least 714,286 containers to have annual 
receipts of $5,000,000. Given data on shipments maintained by the 
committees' staff and the average handler price received during the 
2003 season, the committees' staff estimates that small handlers 
represent approximately 94 percent of all the handlers within the 
industry.
    The committees' staff has also estimated that less than 20 percent 
of the producers in the industry could be defined as other than small 
entities. In the 2003 season, the average producer price received was 
$4.00 per container or container equivalent for nectarines and peaches. 
A producer would have to produce at least 187,500 containers of 
nectarines and peaches to have annual receipts of $750,000. Given data 
maintained by the committees' staff and the average producer price 
received during the 2003 season, the committees' staff estimates that 
small producers represent more than 80 percent of the producers within 
the industry.
    With an average producer price of $4.00 per container or container 
equivalent, and a combined packout of nectarines and peaches of 
44,202,600 containers, the value of the 2003 packout level is estimated 
to be $176,810,400. Dividing this total estimated grower revenue figure 
by the estimated number of producers (1,800) yields an estimated 
average revenue per producer of approximately $98,228 from the sales of 
nectarines and peaches.

[[Page 19755]]

Discussion of the Change in Minimum Net Weight

    Under Sec. Sec.  916.52 and 917.41 of the orders, pack and 
container requirements are established for fresh shipments of 
California nectarines and peaches, respectively. Such requirements are 
in effect on a continuing basis. The NAC and PCC met on February 25, 
2004, and unanimously recommended that the minimum net weight for 
loose-filled bulk bin containers be reduced from 400 to 100 pounds. 
This recommendation was presented to the committees by the Tree Fruit 
Quality Subcommittee after a thorough discussion at their February 4, 
2004, meeting. A handler requested that the subcommittee review the 
current minimum net weight of bulk bin containers used for loose-filled 
shipments of nectarines and peaches.
    The subcommittee discussed the historical significance of the 
current minimum net weight of 400 pounds and deliberated the relative 
value of recommending various lighter net weights, as well. They 
determined that the optimum net weight for bulk bin containers was 100 
pounds. Until recently, they noted, there were few, if any, shipments 
of nectarines and peaches in bulk bins. However, changes in the 
industry, improvements in containers, shipments of increasingly more 
mature fruit, and the demands of their retail customers have apparently 
improved the prospects for such shipments.
    In considering possible alternatives to this action, the 
subcommittee discussed varying minimum net weights, and the types and 
sizes of bulk bin containers currently available to the industry. While 
other alternatives were not rejected out of hand, the subcommittee 
reasoned that decreasing the current 400-pound minimum net weight to 
100 pounds was a prudent option since the weight of the container 
constituted a minimum net weight rather than a maximum net weight. Such 
a weight afforded increased protection of the fruit in the bin while 
providing increased flexibility for handlers who might want to 
experiment with varying weights, as their customers demanded. If a 
handler had customer requests for 125 pounds, that option would be 
available under the recommendations. If another handler had a request 
for 250 pounds, that option would also be available.
    The committees agreed with the Tree Fruit Quality Subcommittee's 
recommendation, except for establishing a trial period during the 2004 
season. The committees voted unanimously to establish the revised 
minimum net weight of 100 pounds for bulk bin containers without the 
requirement for a trial during the 2004 season or an industry review at 
the end of the season.
    The committees make recommendations regarding all the revisions in 
handling requirements after considering all available information, 
including recommendations by various subcommittees, comments of persons 
at subcommittee meetings, and comments received by committee staff. 
Such subcommittees include the Tree Fruit Quality and Research 
Subcommittees, and the Executive Committee.
    At the meetings, the impact of and alternatives to these 
recommendations are deliberated. These subcommittees, like the 
committees themselves, frequently consist of individual producers and 
packers with many years' experience in the industry who are familiar 
with industry practices and trends. Like all committee meetings, 
subcommittee meetings are open to the public and comments are widely 
solicited. In the case of the Tree Fruit Quality Subcommittee, many 
growers and handlers who are affected by the issues discussed by the 
subcommittee attend and actively participate in the public 
deliberations. In fact, if a specific producer or handler is known to 
have an interest in one or more topics to be discussed, committee staff 
specifically invites him or her to the meetings to participate in the 
debate and provide information not already available to staff and the 
subcommittee, including information which may refute the staff's 
findings. In fact, this recommendation resulted from a request made by 
a handler who was specifically invited by staff to take his concerns to 
the Tree Fruit Quality Subcommittee.
    In addition, minutes of all subcommittee and committee meetings are 
distributed to committee members and others who have requested them, 
thereby increasing the availability of information within the industry. 
The staff is currently surveying committee members and others in the 
industry to determine each person's preference in receiving committee 
communications. Each person has the opportunity to specify how he or 
she would like meeting agendas and other committee communications to be 
delivered: facsimile, electronic mail, and/or mailed hard copy. The 
staff is also preparing to make meeting minutes available on the 
committees' Web site, as well, where meeting agendas are currently 
available.
    This rule does not impose any additional reporting and 
recordkeeping requirements on either small or large packers. 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.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap, or conflict with this rule.
    In addition, the committees' meetings are widely publicized 
throughout the nectarine and peach industry and all interested parties 
are encouraged to attend and participate in committee deliberations on 
all issues. These meetings are held annually during the fall, late 
winter, and early spring. Like all committee meetings, the February 25, 
2004, meetings were public meetings, and all entities, large and small, 
were encouraged to express views on these issues. These regulations 
were also reviewed and thoroughly discussed at a subcommittee meeting 
held on February 4, 2004. 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 the 
following Web site: 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.
    This rule invites comments on this change to the handling 
requirements currently prescribed under the marketing orders for 
California fresh nectarines and peaches. All comments received will 
become a matter of public record and will be available for public 
inspection during regular business hours at the same address or at 
http://www.ams.usda.gov/fv/moab.html. Once the Web site page is opened, 
click on ``nectarines'' or ``peaches,'' and find the docket number of 
this proposed rule. Any comments received regarding this rule will be 
found in the ``Comments Received'' link. If no comments are received in 
response to a rule, there will be no ``Comments Received'' link. Any 
comments received will be considered prior to finalization of this 
rule.
    After consideration of all relevant matters presented, the 
information and recommendations submitted by the committees, and other 
information, it is found that this interim final rule, as hereinafter 
set forth, will tend to effectuate the declared policy of the Act.
    Pursuant to 5 U.S.C. 553, it is also found and determined, upon 
good cause, that it is impracticable, unnecessary, and contrary to the 
public interest to give preliminary notice prior to putting this rule 
into effect, and that

[[Page 19756]]

good cause exists for not postponing the effective date of this rule 
until 30 days after publication in the Federal Register because: (1) 
California nectarine and peach shipments of 2004 crop began in April 
and producers and handlers should be allowed to take advantage of the 
bulk-bin net weight reduction as soon as possible; (2) this rule 
relaxes the container and pack requirements for nectarines and peaches; 
(3) the committees unanimously recommended the relaxation at public 
meetings and interested persons had opportunities to provide input at 
these meetings and other meetings; and (4) the rule provides a 60-day 
comment period, and any written comments timely received will be 
considered prior to any finalization of this interim final rule.

List of Subjects

7 CFR Part 916

    Marketing agreements, Nectarines, Reporting and recordkeeping 
requirements.

7 CFR Part 917

    Marketing agreements, Peaches, Pears, Reporting and recordkeeping 
requirements.

0
For the reasons set forth in the preamble, 7 CFR parts 916 and 917 are 
amended as follows:

PART 916--NECTARINES GROWN IN CALIFORNIA

0
1. The authority citation for 7 CFR parts 916 and 917 continues to read 
as follows:

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


0
2. In Sec.  916.350, the introductory text of paragraph (a)(9) is 
revised to read as follows:


Sec.  916.350  California nectarine container and pack regulation.

    (a) * * *
    (9) Each bulk bin container of loose-filled nectarines shall 
contain not less than 100 pounds net weight, and bear on one outside 
panel, in plain sight and in plain letters, the following information:
* * * * *

PART 917--FRESH PEARS AND PEACHES GROWN IN CALIFORNIA

0
3. In Sec.  917.442, the introductory text of paragraph (a)(10) is 
revised to read as follows:


Sec.  917.442  California peach container and pack regulation.

    (a) * * *
    (10) Each bulk bin container of loose-filled peaches shall contain 
not less than 100 pounds net weight, and bear on one outside panel, in 
plain sight and in plain letters, the following information:
* * * * *

    Dated: April 9, 2004.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 04-8522 Filed 4-13-04; 8:45 am]
BILLING CODE 3410-02-P