[Federal Register Volume 69, Number 129 (Wednesday, July 7, 2004)]
[Rules and Regulations]
[Pages 41120-41128]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-15332]



[[Page 41119]]

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Part VI





Department of Agriculture





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Agricultural Marketing Service



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7 CFR Parts 916 and 917



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

  Federal Register / Vol. 69 , No. 129 / Wednesday, July 7, 2004 / 
Rules and Regulations  

[[Page 41120]]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 916 and 917

[Docket No. FV04-916-1 FIR]


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

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: The Department of Agriculture (USDA) is adopting, as a final 
rule, with changes, an interim final rule revising the handling 
requirements for California nectarines and peaches by modifying the 
grade, size, maturity, and container requirements for fresh shipments 
of these fruits, beginning with 2004 season shipments. This rule also 
continues in effect an on-going modification of the requirements for 
placement of Federal-State Inspection Service lot stamps for the 2004 
season and beyond, continues in effect a minimum net weight for a style 
of containers, continues in effect the authorization to continue 
shipments of ``CA Utility'' quality nectarines and peaches, and 
continues in effect the revision of the tolerance for blossom-end 
growth cracks for Peento type peaches. 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 will enable handlers to 
continue shipping fresh nectarines and peaches meeting consumer needs 
in the interests of producers, handlers, and consumers of these fruits.

EFFECTIVE DATE: August 6, 2004.

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 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 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, lot stamping, grade, size, maturity, container, 
container marking, 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 November 12, 2003, and 
unanimously recommended that these handling requirements be revised for 
the 2004 season, which began about the second week of April. The 
changes: (1) Continue indefinitely the lot stamping requirements that 
have been in effect since the 2000 season; (2) authorize continued 
shipments of ``CA Utility'' quality fruit during the 2004 season; (3) 
revise tolerances for blossom-end growth cracks for Peento type 
peaches; (4) establish a minimum net weight for volume-filled, five 
down containers; (5) add an additional container to the list of 
standard containers and amend the dimensions of another container 
already regulated; and (6) revise varietal maturity, quality, and size 
requirements to reflect changes in growing and marketing practices. 
These changes continue in effect until modified, suspended, or 
terminated.
    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 November 12, 
2003. 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' November 12, 2003, meetings because the nectarine and peach 
trees were dormant. The committees subsequently made crop estimates at 
their meetings on April 28, 2004. The 2004 nectarine crop was estimated 
to be approximately 22,245,000 containers, and the 2004 peach crop was 
estimated to be approximately 22,601,000 containers. These crops are 
similar to the 2003 crops, which totaled 21,896,300 containers of 
nectarines and 22,306,300 containers of peaches.

Lot Stamping Requirements

    Sections 916.55 and 917.45 of the orders require inspection and 
certification of nectarines and peaches, respectively, handled by 
handlers. Sections 916.115 and 917.150 of the nectarine and peach 
orders' rules and regulations, respectively, require that all exposed 
or outside containers of nectarines and peaches, and at least 75 
percent of the total containers on a pallet, be stamped with the 
Federal-State Inspection Service (inspection service) lot stamp number 
after inspection and before shipment to show that the fruit has been 
inspected. These requirements apply except for

[[Page 41121]]

containers that are loaded directly onto railway cars, exempted, or 
mailed directly to consumers in consumer packages.
    Lot stamp numbers are assigned to each handler by the inspection 
service, and are used to identify the handler and the date on which the 
container was packed. The lot stamp number is also used by the 
inspection service to identify and locate the inspector's corresponding 
working papers or field notes. Working papers are the documents each 
inspector completes while performing an inspection on a lot of 
nectarines or peaches. Information contained in the working papers 
supports the grade levels certified to by the inspector at the time of 
the inspection.
    The lot stamp number has value for the industries, as well. The 
committees utilize the lot stamp number and date codes to trace fruit 
in the container back to the orchard from which it was harvested. This 
information is essential in providing quick information for a crisis 
management program instituted by the industries. Without the lot stamp 
information on each container, the ``trace back'' effort, as it is 
called, would be jeopardized.
    Several new containers have been adopted for use by nectarine and 
peach handlers in recent years. These containers are returnable plastic 
containers (RPCs). Use of RPCs may represent substantial savings to 
retailers for storage and disposal, as well as for handlers who do not 
have to pay for traditional, single-use containers. Fruit is packed in 
the containers by the handler, delivered to the retailer, emptied, and 
returned to a central clearinghouse for cleaning and redistribution to 
the handler. However, because these containers are designed for reuse, 
RPCs do not support markings that are permanently affixed to the 
container. All markings must be printed on cards that slip into tabs on 
the front or sides of the containers. The cards are easily inserted and 
removed, and further contribute to the efficient reuse of RPCs.
    The cards are a continuing concern for the inspection service and 
the industry because of their unique portability. There is some concern 
that the cards on pallets of inspected containers could easily be moved 
to pallets of uninspected containers, thus permitting a handler to 
avoid inspection on a lot or lots of nectarines or peaches. This would 
also jeopardize the use of the lot stamp numbers for the industry's 
``trace back'' program.
    To address this concern since the 2000 season, the committees have 
annually recommended that pallets of inspected fruit in RPCs be 
identified with a USDA-approved pallet tag containing the lot stamp 
number, in addition to the lot stamp number printed on the card on each 
container. In this way, noted the committees, an audit trail would be 
created confirming that the lot stamp number on each container on the 
pallet corresponds to the lot stamp number on the pallet tag.
    The committees and the inspection service presented their concerns 
to the manufacturers of these types of containers prior to the 2000 
season. At that time, one manufacturer indicated a willingness to 
address the problem by offering an area on the principal display panel 
where the container markings would adhere to the container. Another 
possible improvement discussed was for an adhesive for the current 
style of containers which would securely hold the cards with the lot 
stamp numbers, yet would be easy for the clearinghouse to remove when 
the containers are washed. However, the changes offered by the 
manufacturers have not yet transpired.
    In a meeting of the Tree Fruit Quality Subcommittee on October 23, 
2003, the subcommittee recognized that as time has passed, the 
likelihood of getting a suitable adhesive for the cards or an area on 
the containers for container markings has decreased significantly. 
Therefore, the subcommittee determined that it was no longer 
appropriate to put this regulation into effect annually. When the time 
comes that an adhesive for the cards becomes available or another 
method for securing the lot stamp on each container is found, the 
subcommittee determined that they would make a recommendation to 
eliminate this requirement.
    For those reasons, the subcommittee unanimously recommended to the 
committees that the requirement for lot stamp numbers on USDA-approved 
pallet tags, when used on RPCs, as well as on individual containers on 
a pallet, be required for the 2004 season and beyond. The committees 
then recommended unanimously that such requirement be implemented for 
the 2004 season and beyond, as well.
    Thus, the amendments to Sec. Sec.  916.115 and 917.150 continue in 
effect and require the lot stamp number to be printed on a USDA-
approved pallet tag, when used on RPCs in addition to the requirement 
that the lot stamp number be applied to cards on all exposed or outside 
containers, and not less than 75 percent of the total containers on a 
pallet. This regulation will remain in effect until such time as it may 
be modified.

Container and Pack Requirements

    Sections 916.52 and 917.41 of the orders authorize establishment of 
container, container marking, and pack requirements for shipments of 
nectarines and peaches, respectively. Under Sec. Sec.  916.350 and 
917.442 of the orders' rules and regulations, the specifications of 
container markings, net weights, well-filled requirements, weight-count 
standards for various sizes of nectarines and peaches, and lists of 
standard containers are provided.
    The committees unanimously recommended that a uniform net weight be 
established for all ``five down'' boxes (commonly referred to as 
``Euro'' boxes) that are volume-filled. Currently, the net weight 
requirement for volume-filled, ``five down'' boxes is 29 and 31 pounds.
    ``Five down'' boxes are containers that lay in a pattern of five 
containers per layer on each pallet. In other words, each layer of 
boxes on a pallet contains only five Euro boxes. Other container sizes 
and footprints may result in nine boxes per layer.
    During the 2003 season, the industry used both the 29-pound and 31-
pound net weights in Euro containers, and committee staff tracked the 
total packages of nectarines and peaches of each weight. The purpose of 
the tracking was to see if one net weight was predominant.
    At a meeting of the Tree Fruit Quality Subcommittee meeting on 
October 23, 2003, the results of the study were released. During the 
2003 season, 94,300 twenty-nine-pound boxes of nectarines were packed 
compared to 8,520 thirty-one-pound boxes of nectarines. There were also 
69,115 twenty-nine-pound boxes of peaches packed as compared to 17,103 
thirty-one-pound boxes. Based upon the statistics, the subcommittee 
voted unanimously to recommend to the committees that the minimum net 
weight for all volume-filled, five down Euro containers should be 
established at 29 pounds.
    At the November 12, 2003, meeting, the NAC and PCC also unanimously 
recommended that all volume-filled, five down Euro boxes have an 
established net weight of 29 pounds, which is to be printed on the end 
of the container.
    Nectarines: For the reasons stated above, the revision of 
paragraphs (a)(1) and (a)(8) of Sec.  916.350 continues in effect to 
refer to all volume-filled, five down Euro containers. Such changes 
will ensure that all volume-filled, five down Euro containers of 
nectarines are a net weight of 29 pounds. The container markings shall 
be placed on

[[Page 41122]]

one outside end of the container in plain sight and in plain letters.
    Peaches: For the reasons stated above, the revision of paragraphs 
(a)(1) and (a)(9) of Sec.  917.442 continues in effect to refer to all 
volume-filled, five down Euro containers. Such changes will ensure that 
all volume-filled, five down Euro containers of peaches are a net 
weight of 29 pounds. The markings shall be placed on one outside end of 
the container in plain sight and in plain letters.

Standard Container Listings

    This rule also makes changes to the pack and container marking 
requirements to establish one new standard container being used by the 
industry and to modify the dimensions of another already regulated. In 
the rules and regulations for nectarines at Sec.  916.350, current 
paragraphs (a)(5) and (a)(6), and for peaches at Sec.  917.442, current 
paragraphs (a)(6) and (a)(7), standard containers, such as the Nos. 
22D, 22E, 22G, and 32, are required to be marked with the net weight. 
Under paragraph (b) in Sec. Sec.  916.350 and 917.442, such standard 
containers are defined. Once the use of a container becomes common in 
the industry, such containers are determined to be standard containers. 
Standard containers represent container types that are recognized by 
the industry and adopted by the retail trade. As such, it is a practice 
of the committees to recommend that such containers be added to the 
list of standard containers together with container marking 
requirements.
    At the November 29, 2001, meeting, the NAC and PCC, acting upon a 
recommendation from the Returnable Plastic Container Task Force, 
unanimously recommended that the Euro five down RPC be added to the 
list of standard containers. The container was, then, added to the list 
of standard containers, as approved by USDA.
    During the 2003 season, the California Department of Food and 
Agriculture (CDFA) modified the dimensions of the Euro five down 
container and assigned it No. 35. CDFA also assigned numbers to one new 
container, the No. 36. These two new numbers were then added to the 
California Agricultural Code. By standardizing containers, the State 
permits handlers to use a new container for more than ten percent of 
their annual shipments. Otherwise, the container would be considered an 
experimental container for which handlers would have to file an 
application and limit shipments in such containers to a maximum of ten 
percent of their total seasonal shipments. Once containers are 
standardized within the California Agricultural Code, they are 
historically added to the orders so that regulated handlers may use 
them for packaging nectarines and peaches.
    Thus, the revision of paragraph (b) of Sec. Sec.  916.350 and 
917.442 continues in effect adding the new No. 36, and the revised and 
renamed No. 35 to the list of standard containers.

Grade and Quality Requirements

    Sections 916.52 and 917.41 of the orders authorize the 
establishment of grade and quality requirements for nectarines and 
peaches, respectively. Prior to the 1996 season, Sec.  916.356 required 
nectarines to meet a modified U.S. No. 1 grade. Specifically, 
nectarines were required to meet U.S. No. 1 grade requirements, except 
for a slightly tighter requirement for scarring and a more liberal 
allowance for misshapen fruit. Prior to the 1996 season, Sec.  917.459 
required peaches to meet the requirements of a U.S. No. 1 grade, except 
for a more liberal allowance for open sutures that were not ``serious 
damage.''
    This rule continues in effect the revisions of Sec. Sec.  916.350, 
916.356, 917.442, and 917.459 to permit shipments of nectarines and 
peaches meeting ``CA Utility'' quality requirements during the 2004 
season. (``CA Utility'' fruit is lower in quality than that meeting the 
modified U.S. No. 1 grade requirements.) Shipments of nectarines and 
peaches meeting ``CA Utility'' quality requirements have been permitted 
each season since 1996.
    Studies conducted by the NAC and PCC in 1996 indicated that some 
consumers, retailers, and foreign importers found the lower-quality 
fruit acceptable in some markets. When shipments of ``CA Utility'' 
nectarines were first permitted in 1996, they represented 1.1 percent 
of all nectarine shipments, or approximately 210,000 containers. 
Shipments of ``CA Utility'' nectarines reached a high of 6 percent 
(1,408,362 containers) during the 2003 season.
    Shipments of ``CA Utility'' peaches totaled 1.9 percent of all 
peach shipments, or approximately 366,000 containers, during the 1996 
season. Shipments of ``CA Utility'' peaches reached a high of 5.6 
percent of all peach shipments (1,231,000 containers) during the 2002 
season.
    Handlers have also commented that the availability of the ``CA 
Utility'' quality option lends flexibility to their packing operations. 
They have noted that they now have the opportunity to remove marginal 
nectarines and peaches from their U.S. No. 1 containers and place this 
fruit in containers of ``CA Utility.'' This flexibility, the handlers 
note, results in better quality U.S. No. 1 packs without sacrificing 
fruit.
    The Tree Fruit Quality Subcommittee met on October 23, 2003, and 
recommended unanimously to the NAC and PCC to continue shipments of 
``CA Utility'' quality nectarines and peaches. Subsequently, the NAC 
and PCC voted unanimously at their November 12, 2003, meetings to 
authorize continued shipments of ``CA Utility'' quality fruit during 
the 2004 season.
    Accordingly, based upon the recommendations, the revisions to 
paragraph (d) of Sec. Sec.  916.350 and 917.442, and paragraph (a)(1) 
of Sec. Sec.  916.356 and 917.459 continue in effect to permit 
shipments of nectarines and peaches meeting ``CA Utility'' quality 
requirements during the 2004 season, on the same basis as shipments 
since the 2000 season.

Maturity Requirements

    In Sec. Sec.  916.52 and 917.41, authority is provided to establish 
maturity requirements for nectarines and peaches, respectively. The 
minimum maturity level currently specified for nectarines and peaches 
is ``mature'' as defined in the standards. For most varieties, ``well-
matured'' determinations for nectarines and peaches are made using 
maturity guides (e.g., color chips). These maturity guides are reviewed 
each year by the Shipping Point Inspection Service (SPI) to determine 
whether they need to be changed, based upon the most-recent information 
available on the individual characteristics of each nectarine and peach 
variety.
    These maturity guides established under the handling regulations of 
the California tree fruit marketing orders have been codified in the 
Code of Federal Regulations as Table 1 in Sec. Sec.  916.356 and 
917.459, for nectarines and peaches, respectively.
    The requirements in the 2004 handling regulations are the same as 
those that appeared in the 2003 handling regulations with a few 
exceptions. Those exceptions are explained in this rule and continue in 
effect.
    Nectarines: Requirements for ``well-matured'' nectarines are 
specified in Sec.  916.356 of the order's rules and regulations. This 
rule continues in effect the revision of Table 1 of paragraph 
(a)(1)(iv) of Sec.  916.356 to add maturity guides for seven varieties 
of nectarines. Specifically, SPI recommended adding maturity guides for 
the Honey Dew variety to be regulated at the B maturity guide, for the 
Emelia and Grand Sweet

[[Page 41123]]

varieties at the J maturity guide, for the June Candy and Regal Red at 
the K maturity guide, and the Gee Sweet and Honey Fire varieties to be 
regulated at the L maturity guide.
    In addition, eight nectarine varieties are no longer being shipped 
and their removal from the listing of maturity guide assignments in 
Table 1 of paragraph (a)(1)(iv) of Sec.  916.356 continues in effect. 
The varieties removed include: Autumn Grand, Early May, Early May 
Grand, Independence, May Jim, May Lion, Red Grand, and Royal Delight 
nectarine varieties.
    The NAC recommended these maturity guide requirements based on 
SPI's continuing review of individual maturity characteristics and 
identification of the appropriate maturity guide corresponding to the 
``well-matured'' level of maturity for nectarine varieties in 
production.
    Peaches: Requirements for ``well-matured'' peaches are specified in 
Sec.  917.459 of the order's rules and regulations. This rule continues 
in effect the revision of Table 1 of paragraph (a)(1)(iv) of Sec.  
917.459 to add maturity guides for twelve peach varieties. 
Specifically, SPI recommended adding maturity guides for the May Sweet 
and Sweet September varieties to be regulated at the I maturity guide; 
the Burpeachone (Spring FlameTM 21), Burpeachtwo (Henry 
IITM), Candy Red, Country Sweet, Pretty Lady, Prima Peach 
23, Shelly, Sierra Gem, and Summer Kist varieties to be regulated at 
the J maturity guide; and the Kaweah peach variety to be regulated at 
the L maturity guide.
    Thus, the revision of Table 1 in paragraph (a)(1)(iv) of Sec.  
917.459 continues in effect to reflect these recommendations.
    In addition, three peach varieties are no longer being shipped and 
their removal from the listing of maturity guide assignments in Table 1 
of paragraph (a)(1)(iv) of Sec.  917.459 continues in effect for the 
Sierra Crest peach variety. The PCC also recommended that the Johnny's 
White and Snow Ball peach varieties be removed. However, these two 
varieties were previously removed from Table 1.
    SPI has also recommended changes to the ``California Well-Matured'' 
or ``CA WELL MAT'' maturity requirements for varieties of nectarines 
and peaches with insufficient ``ground color'' (ground color is the 
skin color beneath the characteristic red or pink exhibited on the 
fruit). Under the changes, the stem cavity will be utilized to make a 
determination regarding ``California Well-Matured'' or ``CA WELL MAT'' 
for varieties that have insufficient ground color. These varieties are 
usually highly colored red varieties on which the stem cavity is the 
only location where the ground color can be seen. SPI further 
recommends that the color in the stem cavity for most varieties should 
be at least at the H maturity guide and that confirmation of the 
maturity may further be established by using other ``California Well-
Matured'' characteristics.
    Further, SPI has recommended that two nectarine varieties be 
notated with an asterisk for additional inspection information. 
According to SPI, inspectors have determined that the Honey Dew and 
Mango varieties are appropriately ``California Well-Matured'' or ``CA 
WELL MAT'' when the ground color is ``breaking yellowish-green.'' In 
other words, the ground color of the fruit is a green color showing 
signs of changing to a yellow or orange color for yellow-fleshed 
varieties, and a green color showing signs of changing to a cream color 
for white-fleshed varieties.
    The amendment to the note at the end of Table 1 of paragraph 
(a)(1)(iv) of Sec.  916.356 continues in effect to reflect these 
recommendations regarding nectarines, and the amendment to the note at 
the end of Table 1 of paragraph (a)(1)(iv) of Sec.  917.459 continues 
in effect to include the recommendation that the stem cavity will be 
used to determine the appropriate ground color for certain peach 
varieties.
    The NAC and PCC recommended these maturity guide requirements based 
on SPI's continuing review of individual maturity characteristics and 
identification of the appropriate maturity guide corresponding to the 
``well-matured'' level of maturity for nectarine and peach varieties in 
production.

Size Requirements

    Both orders provide (in Sec. Sec.  916.52 and 917.41) authority to 
establish size requirements. Size regulations encourage producers to 
leave fruit on the tree longer, which improves both size and maturity 
of the fruit. Acceptable fruit size provides greater consumer 
satisfaction and promotes repeat purchases, and, therefore, increases 
returns to producers and handlers. In addition, increased fruit size 
results in increased numbers of packed containers of nectarines and 
peaches per acre, also a benefit to producers and handlers.
    Varieties recommended for specific size regulations have been 
reviewed and such recommendations are based on the specific 
characteristics of each variety. The NAC and PCC conduct studies each 
season on the range of sizes attained by the regulated varieties and 
those varieties with the potential to become regulated, and determine 
whether revisions to the size requirements are appropriate.
    Nectarines: Section 916.356 of the order's rules and regulations 
specifies minimum size requirements for fresh nectarines in paragraphs 
(a)(2) through (a)(9). This rule continues in effect the revision of 
Sec.  916.356 to establish variety-specific minimum size requirements 
for nine varieties of nectarines that were produced in commercially 
significant quantities of more than 10,000 containers for the first 
time during the 2003 season. This rule also continues in effect the 
removal of the variety-specific minimum size requirements for five 
varieties of nectarines whose shipments fell below 5,000 containers 
during the 2003 season.
    For example, one of the varieties recommended for addition to the 
variety-specific minimum size requirements is the White September 
variety of nectarines, recommended for regulation at a minimum size 80. 
Studies of the size ranges attained by the White September variety 
revealed that 100 percent of the containers met the minimum size of 80 
during the 2000, 2001, and 2002 seasons. Sizes ranged from size 40 to 
size 80, with 24.7 percent of the fruit in the 40 sizes, 33.1 percent 
of the packages in the 50 sizes, 38.9 percent in the 60 sizes, 3.3 
percent in the 70 sizes, and 0 percent in the size 80, for the 2002 
season. However, the fruit sized down to the 80 sizes during the two 
previous seasons, and setting the minimum size at size 70 would not be 
appropriate at this time.
    A review of other varieties with the same harvesting period 
indicated that the White September variety was also comparable to those 
varieties in its size ranges for that time period. Discussions with 
handlers known to handle the variety confirm this information regarding 
minimum size and harvesting period, as well. Thus, the recommendation 
to place the White September in the variety-specific minimum size 
regulation at a minimum size 80 is appropriate. This recommendation 
results from size studies conducted over a three-year period.
    Historical data such as this provides the NAC with the information 
necessary to recommend the appropriate sizes at which to regulate 
various nectarine varieties. In addition, producers and handlers of the 
varieties affected are personally invited to comment when such size 
recommendations are

[[Page 41124]]

deliberated. Producer and handler comments are also considered at both 
NAC and subcommittee meetings when the staff receives such comments, 
either in writing or verbally.
    For reasons similar to those discussed in the preceding paragraph, 
the revision of the introductory text of paragraph (a)(4) of Sec.  
916.356 continues in effect to include the Spring Ray variety; the 
revision of the introductory text of paragraph (a)(5) of Sec.  916.356 
continues in effect to include the Mango variety; and the revision of 
the introductory text of paragraph (a)(6) of Sec.  916.356 continues in 
effect to include the Arctic Gold, August Fire, Emelia, Honey Fire, Red 
Pearl, Ruby Bright, and White September nectarine varieties.
    This rule also continues in effect the revision of the introductory 
text of paragraphs (a)(3), (a)(4), and (a)(6) of Sec.  916.356 to 
remove five varieties from the variety-specific minimum size 
requirements specified in these paragraphs because less than 5,000 
containers of each of these varieties were produced during the 2003 
season. Specifically, the revision of the introductory text of 
paragraph (a)(3) of Sec.  916.356 continues in effect to remove the 
Grand Sun nectarine variety; the revision of the introductory text of 
paragraph (a)(4) of Sec.  916.356 continues in effect to remove the May 
Grand and Red Glo nectarine varieties; and the revision of the 
introductory text of paragraph (a)(6) of Sec.  916.356 continues in 
effect to remove the Firebrite and Sun Diamond nectarine varieties.
    Nectarine varieties removed from the nectarine variety-specific 
minimum size requirements become subject to the non-listed variety size 
requirements specified in paragraphs (a)(7), (a)(8), and (a)(9) of 
Sec.  916.356.
    Peaches: Section 917.459 of the order's rules and regulations 
specifies minimum size requirements for fresh peaches in paragraphs 
(a)(2) through (a)(6), and paragraphs (b) and (c). The revision of 
Sec.  917.459 to establish variety-specific minimum size requirements 
for 17 peach varieties that were produced in commercially significant 
quantities of more than 10,000 containers for the first time during the 
2003 season continues in effect. This rule also continues in effect the 
removal of the variety-specific minimum size requirements for 14 
varieties of peaches whose shipments fell below 5,000 containers during 
the 2003 season.
    For example, one of the varieties recommended for addition to the 
variety-specific minimum size requirements is the Jupiter variety of 
peaches, which was recommended for regulation at a minimum size 72. 
Studies of the size ranges attained by the Jupiter variety revealed 
that 100 percent of the containers met the minimum size of 72 during 
the 2000, 2001, and 2002 seasons. The sizes ranged from size 30 to size 
70, with 39.1 percent of the containers meeting the size 30, 31.1 
percent meeting the size 40, 29.3 percent meeting the size 60, and .05 
percent meeting the size 70.
    A review of other varieties with the same harvesting period 
indicated that the Jupiter variety was also comparable to those 
varieties in its size ranges for that time period. Discussions with 
handlers known to pack the variety confirm this information regarding 
minimum size and the harvesting period, as well. Thus, the 
recommendation to place the Jupiter variety in the variety-specific 
minimum size regulation at a minimum size 72 is appropriate. This 
recommendation, as with all other size recommendations for peaches, 
results from size studies conducted over a three-year period.
    Historical data such as this provides the PCC with the information 
necessary to recommend the appropriate sizes at which to regulate 
various peach varieties. In addition, producers and handlers of the 
varieties affected are personally invited to comment when such size 
recommendations are deliberated. Producer and handler comments are also 
considered at both PCC and subcommittee meetings when the staff 
receives such comments, either in writing or verbally.
    For reasons similar to those discussed in the preceding paragraph, 
the revision of the introductory text of paragraph (a)(5) of Sec.  
917.459 continues in effect to include the Burpeachfourteen (Spring 
Flame TM 20), Scarlet Queen, Sugar Time (214LC68), and the 
Supecheight peach varieties; and the revision of the introductory text 
of paragraph (a)(6) of Sec.  917.459 continues in effect to include the 
Autumn Fire, Autumn Ruby, Burpeachseven (Summer Flame TM 
29), Gypsy Red, Ice Princess, Jupiter, Late September Snow, Magenta 
Gold, Pink Moon, Ruby Gold, Sugar Crisp, Sugar Red, and Sweet Blaze 
peach varieties.
    This rule also continues in effect the revision of the introductory 
text of paragraph (a)(4) of Sec.  917.459 to remove the Snow Dance 
peach variety; continues in effect the revision of the introductory 
text of paragraph (a)(5) of Sec.  917.459 to remove the Happy Dream, 
Kern Sun, Kingscrest, Pink Rose, Ray Crest, and Rich Mike peach 
varieties; and continues in effect the revision of the introductory 
paragraph (a)(6) of Sec.  917.459 to remove the Cassie, Flamecrest, 
Kings Lady, Prima Peach XXV, Red Dancer, Sierra Lady, and Sweet Gem 
peach varieties from the variety-specific minimum size requirements 
specified in the section because less than 5,000 containers of each of 
these varieties was produced during the 2003 season.
    The removal of the Snow Dance peach variety from the introductory 
text of paragraph (a)(4) of Sec.  917.459 results in no peach varieties 
regulated at a minimum size 84 and continues in effect. This paragraph 
is being reserved for future use. The committees may recommend new 
peach varieties for regulation at this size in the future.
    Peach varieties removed from the peach variety-specific minimum 
size requirements become subject to the non-listed variety size 
requirements specified in paragraphs (b) and (c) of Sec.  917.459.
    The NAC and PCC recommended these changes in the minimum size 
requirements based on a continuing review of the sizing and maturity 
relationships for these nectarine and peach varieties, and the consumer 
acceptance levels for various fruit sizes. This rule continues in 
effect the establishment of minimum size requirements for fresh 
nectarines and peaches consistent with expected crop and market 
conditions.

Peento Type Peach Tolerances

    The Tree Fruit Quality Subcommittee met on July 25, 2003, to 
discuss a modified blossom-end growth crack tolerance for Peento type 
peaches for the 2004 and subsequent seasons. Peento type peaches, also 
known as donut peaches due to their characteristic flattened shape, 
have been produced for a decade. Because of their genetic 
characteristics, these flattened peaches are prone to blossom-end 
growth cracks. These cracks heal while on the tree and do not affect 
the edibility of the fruit. Since the 2000 season, this peach has been 
provided an additional tolerance of 10 percent for well-healed, non-
serious blossom-end growth cracks. A grower who produces a large 
quantity of Peento type peaches advised the subcommittee that adverse 
weather in the spring of 2003 caused a larger than normal percentage of 
his fruit to fail inspection even with the additional tolerance for 
well-healed, non-serious blossom-end growth cracks.
    The subcommittee deliberated whether to relax the tolerance for 
blossom-end growth cracks, carefully weighing the grower's desire to 
market as much of his crop as possible against the industry's desire of 
assuring that quality peaches end up in the market place. In the end, 
the subcommittee

[[Page 41125]]

decided that this was a minor defect that did not affect edibility, 
contribute to internal breakdown, or dramatically detract from fruit 
appearance, and recommended to the PCC that the tolerance be modified. 
The modification allows for an unlimited amount of blossom-end cracking 
as long as the cracks are well healed and do not exceed the aggregate 
area of a circle \3/8\ of an inch in diameter and/or do not exceed a 
depth that exposes the peach pit.
    The PCC adopted the subcommittee's recommendation on blossom-end 
growth cracks and recommended the relaxations to USDA. Continuation of 
the relaxed requirements are expected to allow more fruit to be 
marketed and to return more value to the producer.
    This rule reflects the committees' and USDA's appraisal of the need 
to revise the handling requirements for California nectarines and 
peaches, as specified. USDA believes that continuing this rule in 
effect will have a beneficial impact on producers, handlers, and 
consumers of fresh California nectarines and peaches.
    This rule continues in effect the establishment of handling 
requirements for fresh California nectarines and peaches consistent 
with expected crop and market conditions, and will help ensure that all 
shipments of these fruits made each season will meet acceptable 
handling requirements established under each of these orders. This rule 
also will help the California nectarine and peach industries provide 
fruit desired by consumers. This rule continues in effect the 
establishment and maintenance of orderly marketing conditions for these 
fruit in the interests of producers, handlers, and consumers.

Final 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 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.

Industry Information

    There are approximately 250 California nectarine and peach handlers 
subject to regulation under the orders covering nectarines and peaches 
grown in California, and about 1,800 producers of these fruits in 
California. Small agricultural service firms, which include handlers, 
are defined by the Small Business Administration [13 CFR 121.201] as 
those whose annual receipts are less than $5,000,000. Small 
agricultural producers are defined by the Small Business Administration 
as those having annual receipts of less than $750,000. A majority of 
these handlers 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. For the 2003 season, the committees' staff estimated that 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. For the 2003 season, the committees' estimated 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 estimate of average revenue per producer of about 
$98,228 from the sales of peaches and nectarines.

Regulatory Revisions

    Under Sec. Sec.  916.52 and 917.41 of the orders, grade, size, 
maturity, container, container marking, and pack 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 November 12, 2003, and unanimously recommended 
that these handling requirements be revised for the 2004 season. These 
recommendations had been presented to the committees by various 
subcommittees, each charged with review and discussion of the changes. 
The changes: (1) Continue the lot stamping requirements which have been 
in effect since the 2000 season; (2) authorize shipments of ``CA 
Utility'' quality fruit to continue during the 2004 season; (3) revise 
tolerances for blossom-end growth cracks for Peento type peaches; (4) 
establish a minimum net weight for volume-filled, five down containers; 
(5) add an additional container to the list of standard containers and 
amend the dimensions of another container already regulated; and (6) 
revise varietal maturity, quality, and size requirements to reflect 
changes in growing and marketing practices. These changes continue in 
effect until modified, suspended, or terminated.

Lot Stamping Requirements--Discussions and Alternatives

    This rule continues in effect the authorization for continuation of 
the lot stamping requirements for returnable plastic containers under 
the marketing orders' rules and regulations that have been in effect 
for such containers since the 2000 season for nectarine and peach 
shipments. The modified requirements of Sec. Sec.  916.115 and 917.150 
mandated that the lot stamp numbers be printed on a USDA-approved 
pallet tag, in addition to the requirement that the lot stamp number be 
applied to cards on all exposed or outside containers, and not less 
than 75 percent of the total containers on a pallet. Continuation of 
such requirements for the 2004 and beyond would help the inspection 
service safeguard the identity of inspected and certified containers of 
nectarines and peaches, and would help the industry by keeping in place 
the information necessary to facilitate their ``trace-back'' program.
    The Tree Fruit Quality Subcommittee met on October 23, 2003, and 
considered possible alternatives to this action. Other alternatives 
were rejected because the members of the subcommittee determined that 
given the different styles and configurations of

[[Page 41126]]

RPCs available, having a satisfactory adhesive for placement of the 
cards might not be realistic. Box manufacturers have been very slow to 
respond to the industry's requests. The subcommittee recognized that as 
time has passed, the likelihood of getting a suitable adhesive for the 
cards has decreased significantly. Therefore, the subcommittee 
determined that it was no longer appropriate to put this regulation 
into effect annually. When the time comes that an adhesive for the 
cards becomes available or another method for securing the lot stamp on 
each container is found, the subcommittee determined that they would 
make a recommendation to adjust this requirement.
    For these reasons, the subcommittee and the committees unanimously 
recommended continuing the requirement for the lot stamp number to be 
printed on the cards on each container and for each pallet to be marked 
with a USDA-approved pallet tag, also containing the lot stamp number 
for the 2004 season and beyond. Such safeguards are intended to ensure 
that all the containers on each pallet have been inspected and 
certified in the event a card on an individual container or containers 
is removed, misplaced, or lost.

Grade and Quality Requirements--Discussions and Alternatives

    In 1996, Sec. Sec.  916.350 and 917.442 were revised to permit 
shipments of ``CA Utility'' quality nectarines and peaches as an 
experiment during that season only. Such shipments have subsequently 
been permitted each season. Since 1996, shipments of ``CA Utility'' 
have ranged from 1 to 5 percent of total nectarine and peach shipments. 
This rule continues in effect the authority to continue shipments of 
``CA Utility'' quality nectarines and peaches during the 2004 season.
    The Tree Fruit Quality Subcommittee met on October 23, 2003, and 
unanimously agreed that the ``CA Utility'' quality requirements that 
are currently in place should be continued. Also, not authorizing such 
shipments would be an abrupt departure from their current practices. 
The NAC and PCC also unanimously recommended such continuation at their 
meetings on November 12, 2003, and have done so continuously since such 
shipments were first authorized in 1996.

Container and Container Marking Requirements--Discussions and 
Alternatives

    Sections 916.350 and 917.442 establish container, pack, and marking 
requirements for shipments of nectarines and peaches, respectively. 
This rule continues in effect the changes to the pack and container 
marking requirements of the orders' rules and regulations to establish 
a minimum net weight of 29 pounds for all types of five down Euro 
boxes.
    This rule also continues in effect the changes to the pack and 
container marking requirements to establish one new standard container 
and to modify the dimensions of a standard container currently being 
used by the industry.
    During the 2003 season, the California Department of Food and 
Agriculture assigned numbers to one new container, the No. 36, modified 
the dimensions of the Euro five down container, and assigned that 
container the No. 35. The new container and the modified dimensions of 
the Euro five down container were then added to the California 
Agricultural Code.
    By standardizing containers, the State permits handlers to use a 
new container for more than ten percent of their annual shipments. 
Otherwise, the container would be considered an experimental container 
for which handlers would have to file an application and limit 
shipments in such containers to a maximum of ten percent of their total 
seasonal shipments. Once containers are standardized within the 
California Agricultural Code, they are historically added to the orders 
so that regulated handlers may use them for packaging nectarines and 
peaches.
    At the meeting of the Tree Fruit Quality Subcommittee on October 
23, 2003, the addition of these standardized boxes was discussed. The 
members noted that these two boxes are used increasingly and may 
continue to be, potentially replacing the older, more conventional 
boxes. According to one member of the subcommittee, no handler really 
wants to add extra boxes to the growing inventory of box sizes and 
styles; but in practical terms, the retail customers prefer the newer 
boxes, so they must be added to the list of available and standard 
containers. The alternative of not adding the containers was 
unacceptable because handlers would not have them available when 
requested by their retail customers.
    The Tree Fruit Quality Subcommittee also discussed the net weight 
requirement for all five down Euro containers at its meeting on October 
23, 2003. At that time, the subcommittee discussed results from the 
2003 season during which both a 29- and 31-pound container had been 
authorized. Experience of handlers during the season resulted in the 
subcommittee's recommendation that only the 29-pound container continue 
to be authorized. The subcommittee unanimously recommended the change 
to the committees. The alternative would have meant that RPC five down 
Euro containers would have been subject to both the 29- and 31-pound 
net weight. In consideration of uniformity for five down Euro 
containers, this alternative was rejected.

Minimum Maturity and Size Levels--Discussions and Alternatives

    Sections 916.356 and 917.459 establish minimum maturity levels. 
This rule continues in effect the annual adjustments to the maturity 
requirements for several varieties of nectarines and peaches. Maturity 
requirements are based on maturity measurements generally using 
maturity guides (e.g., color chips), as recommended by SPI. Such 
maturity guides are reviewed annually by SPI to determine the 
appropriate guide for each nectarine and peach variety. These annual 
adjustments reflect refinements in measurements of the maturity 
characteristics of nectarines and peaches as experienced over previous 
seasons' inspections. Adjustments in the guides utilized ensure that 
fruit has met an acceptable level of maturity, ensuring consumer 
satisfaction while benefiting nectarine and peach producers and 
handlers.
    Currently, in Sec.  916.356 of the nectarine order's rules and 
regulations, and in Sec.  917.459 of the peach order's rules and 
regulations, minimum sizes for various varieties of nectarines and 
peaches, respectively, are established. This rule continues in effect 
the adjustments to the minimum sizes authorized for various varieties 
of nectarines and peaches for the 2004 season. Minimum size regulations 
are put in place to encourage producers to leave fruit on the trees for 
a longer period of time. This increased growing time not only improves 
maturity, but also increases fruit size. Increased fruit size increases 
the number of packed containers per acre, and coupled with heightened 
maturity levels, also provides greater consumer satisfaction, fostering 
repeat purchases. Such improved consumer satisfaction and repeat 
purchases benefit both producers and handlers alike.
    Annual adjustments to minimum sizes of nectarines and peaches, such 
as these, are recommended by the NAC and PCC based upon historical 
data, producer and handler information regarding sizes attained by 
different varieties, and trends in consumer purchases.

[[Page 41127]]

    An alternative to such action would include not establishing 
minimum size regulations for these new varieties. Such an action, 
however, would be a significant departure from the committees' 
practices and represent a substantial change in the regulations as they 
currently exist; would ultimately increase the amount of less 
acceptable fruit being marketed to consumers; and would be contrary to 
the long-term interests of producers, handlers, and consumers. For 
these reasons, this alternative was not recommended.

Peento Type Peach Tolerances--Discussions and Alternatives

    The Tree Fruit Quality Subcommittee met on July 25, 2003, to 
discuss a modified growth-crack tolerance for Peento type peaches for 
the 2004 and later seasons with a concerned grower. The grower advised 
the subcommittee that weather problems created some anomalies for his 
2003 crop of Peento type peaches. A larger-than-normal percentage of 
his fruit failed inspection during the 2003 season because of blossom-
end growth cracks. This type of peach is prone to such cracks. However, 
the cracks do not affect the edibility of the fruit, contribute to 
internal breakdown, or detract from the appearance of the fruit unless 
the cracks are unusually large or deep.
    The subcommittee deliberated whether to relax the tolerance for 
blossom end growth cracks for the 2004 season, carefully weighing the 
grower's need to have a crop to market and the need to maintain a 
quality product in the market place. In the end, the subcommittee 
determined that peaches of the Peento type should be permitted blossom-
end cracking as long as the cracks are well healed, do not exceed the 
aggregate area of a circle \3/8\ inch in diameter, and/or do not exceed 
a depth that exposes the pit. This relaxation is in lieu of the 
previous requirement that Peento type peaches should be permitted a 10 
percent tolerance for well-healed, non-serious, blossom-end growth 
cracks.
    The PCC agreed with the subcommittee and recommended that the 
current tolerance for blossom-end growth cracks on Peento type peaches 
be revised to meet the demands of the growers and buyers of these 
unique peaches.
    An alternative to this action would have been to leave these 
requirements unchanged. However, this would have meant that the growers 
of these fruits would be restricted in marketing them, since these 
fruits exhibit an increased propensity for blossom-end growth cracks, 
which are only a cosmetic defect. The relaxation is expected to allow 
more of these peaches to be marketed and to improve producer returns.
    The committees make recommendations regarding the revisions in 
handling and lot stamping 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 
Subcommittee, the Marketing Order Amendment Task Force, 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 
handlers with many years of 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, or call and/or write in their concerns and comments to 
the staff for presentation at the meetings. In addition, minutes of all 
subcommittee meetings are distributed to committee members and others 
who have requested them and are available on the committees' Web site, 
thereby increasing the availability of information within the industry.
    An interim final rule concerning this action was published in the 
Federal Register on March 25, 2004. Copies of the rule were posted on 
the committees' Web site and were also made available through the 
Internet by USDA and the Office of the Federal Register. That rule 
provided for a 60-day comment period, which ended on May 24, 2004. Two 
comments were submitted on the rule.
    First, a commenter noted that the Spring Ray nectarine variety name 
should be changed to include the patented name, Burnectone. This rule 
changes the name in Table 1 of paragraph (a)(1)(iv) in Sec.  916.356 
and in the introductory text of paragraph (a)(4) of Sec.  916.356.
    The commenter also noted that the peach varieties referred to as 
91002 and 012-094 in Sec.  917.459 (a)(2) and (a)(5) should be changed 
to include their patented names Supechsix and Supecheight, 
respectively. The peach variety name, Supecheight, in paragraph (a)(5) 
of Sec.  917.459, is changed by adding the patented name ``012-094'' in 
parentheses, Supecheight (012-094). The correction of paragraph (a)(2) 
of Sec.  917.459 will be made to remove the name ``91002'' and add the 
name ``Supechsix (91002)''.
    The interim final rule identified both the Mango and the Honey Dew 
nectarine varieties as requiring the stem cavity color to be ``breaking 
yellowish-green.'' The commenter noted that the NAC recommended only 
the Honey Dew nectarine variety for this designation and asked for a 
correction on the appropriate ``ground color'' requirement for the 
Mango variety nectarines. However, at the NAC meeting where this matter 
was discussed, the Federal or Federal-State Inspection Service, which 
includes SPI, recommended that this ground color requirement apply to 
both varieties of nectarines. As earlier mentioned, maturity 
requirements are based on maturity measurements generally using 
maturity guides (e.g., color chips), as recommended by SPI. Such 
maturity guides are reviewed annually by SPI to determine the 
appropriate guide for each nectarine variety. These annual adjustments 
reflect refinements in measurements of the maturity characteristics of 
nectarines as experienced over previous seasons' inspections. For these 
reasons, the language in the interim final rule requiring both the 
Honey Dew and Mango nectarine varieties to exhibit ``breaking 
yellowish-green'' color in their stem cavities remains as published.
    The commenter also asked for placement of an asterisk in the 
``Note'' footnote at the end of Table 1 of paragraph (a)(1)(iv) in 
Sec.  916.356 prior to the statement: ``Predominant ground color must 
be breaking yellowish green.'' Apparently, this asterisk was omitted in 
the publication of the interim final rule and has been added.
    The commenter noted, too, that the term ``California Well-Matured'' 
was incorrectly referred to as ``California Well-Mature'' in the 
``Note'' at the end of Table 1 of paragraph (a)(1)(iv) in Sec.  916.356 
and the ``Note'' at the end of Table 1 of paragraph (a)(1)(iv) of Sec.  
917.459. Those corrections have been made, as well.
    In the second comment, the commenter noted his support for the lot 
stamping requirements, container and pack requirements, the authority 
to ship ``CA Utility'' quality fruit, and maturity requirements in the 
interim final rule.
    Each of the recommended handling requirement changes for the 2004 
season is expected to generate financial benefits for producers and 
handlers through

[[Page 41128]]

increased fruit sales, compared to the situation that would exist if 
the changes were not adopted. Both large and small entities are 
expected to benefit from the changes, and the costs of compliance are 
not expected to be substantially different between large and small 
entities.
    This rule does not impose any additional reporting and 
recordkeeping requirements on either small or large handlers. 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. However, as previously stated, 
nectarines and peaches under the orders have to meet certain 
requirements set forth in the standards issued under the Agricultural 
Marketing Act of 1946 (7 CFR 1621 et seq.). Standards issued under the 
Agricultural Marketing Act of 1946 are otherwise voluntary.
    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 in the fall and spring. 
Like all committee meetings, the November 12, 2003, 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 subcommittee meetings held on July 25, October 
1, and October 23, 2003. Finally, interested persons were 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.
    After consideration of all relevant matters presented, the 
information and recommendations submitted by the committees, comments 
received, and other information, it is found that finalizing the 
interim final rule, with changes, as published in the Federal Register, 
(69 FR 15641, March 25, 2004) will tend to effectuate the declared 
policy of the Act.

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
Accordingly, the interim final rule amending 7 CFR parts 916 and 917, 
which was published at 69 FR 15641 on March 25, 2004, is adopted as a 
final rule with the following changes:

PART 916--NECTARINES GROWN IN CALIFORNIA

PART 917--FRESH PEARS AND PEACHES 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.

PART 916--NECTARINES GROWN IN CALIFORNIA


Sec.  916.356  [Amended]

0
2. Section 916.356 is amended by:
0
A. Removing the entry ``Spring Ray'' and adding in alphabetical order 
the entry ``Burnectone (Spring Ray)'' in Table 1, paragraph (a)(1)(iv);
0
B. Removing the words ``California Well-Mature'' in the ``Note'' 
following Table 1, paragraph (a)(1)(iv), and adding the words 
``California Well-Matured'' in their place;
0
C. Adding an asterisk before the words ``Predominant ground color must 
be breaking yellowish green'' in the ``Note'' following Table 1, 
paragraph (a)(1)(iv); and
0
D. Removing the words ``Spring Ray'' and adding the words ``Burnectone 
(Spring Ray)'' in alphabetical order in paragraph (a)(4) introductory 
text.
* * * * *

PART 917--FRESH PEARS AND PEACHES GROWN IN CALIFORNIA


Sec.  917.459  [Amended]

0
4. Section 917.459 is amended by:
0
A. Removing the words ``California Well-Mature'' in the ``Note'' 
following Table 1, paragraph (a)(1)(iv), and adding the words 
``California Well-Matured'' in their place;
0
B. Removing the number ``91002'' in paragraph (a)(2) and adding 
``Supechsix (91002)'' in its place;
0
C. Removing the number ``012-094'' in paragraph (a)(5); and
0
D. Removing the word ``Supecheight'' and adding ``Supecheight (012-
094)'' in its place in paragraph (a)(5).

    Dated: June 30, 2004.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 04-15332 Filed 7-6-04; 8:45 am]
BILLING CODE 3410-02-P