[Federal Register Volume 70, Number 27 (Thursday, February 10, 2005)]
[Rules and Regulations]
[Pages 6999-7002]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-2545]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 923

[Docket No. FV04-923-1 FR]


Sweet Cherries Grown in Designated Counties in Washington; 
Establishment of Minimum Size and Maturity Requirements for Lightly 
Colored Sweet Cherry Varieties

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This rule establishes a minimum size requirement of 11-row 
size (\61/64\-inch diameter) and a minimum maturity requirement of 17 
percent soluble solids for all lightly colored sweet cherry varieties 
shipped to fresh markets under the Washington sweet cherry marketing 
order. This rule was recommended by the Washington Cherry Marketing 
Committee (Committee), the agency responsible for local administration 
of the marketing order. Previously, only the Rainier variety of lightly 
colored sweet cherries met these requirements. This rule is intended to 
enhance the quality and image of all lightly colored sweet cherry 
varieties shipped to the fresh market, thereby increasing sales and 
improving returns to producers.

EFFECTIVE DATE: April 1, 2005.

FOR FURTHER INFORMATION CONTACT: Teresa L. Hutchinson, Marketing 
Specialist, Northwest Marketing Field Office, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1220 
SW., Third Avenue, Suite 385, Portland, OR 97204; telephone: (503) 326-
2724; Fax: (503) 326-7440; or George J. 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 final rule is issued under Marketing 
Agreement and Order No. 923 (7 CFR part 923) regulating the handling of 
sweet cherries grown in designated counties in Washington, hereinafter 
referred to as the ``order.'' The order is 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 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

[[Page 7000]]

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. Such 
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.
    This final rule establishes a minimum size requirement of 11-row 
size (\61/64\-inch diameter) and a minimum maturity requirement of 17 
percent soluble solids for all lightly colored sweet cherry varieties 
shipped to fresh markets. Previously, Rainier variety cherries were the 
only lightly colored sweet cherries under these requirements. This rule 
establishes the same requirements for all other varieties of lightly 
colored sweet cherries as are established for Rainier variety cherries.
    Section 923.52 of the order authorizes the establishment of grade, 
size, quality, maturity, pack, and container regulations for any 
variety or varieties of cherries grown in the production area. Section 
923.53 further authorizes the modification, suspension, or termination 
of regulations issued under Sec.  923.52. Section 923.55 provides that 
whenever cherries are regulated pursuant to Sec.  923.52 or Sec.  
923.53, such cherries must be inspected by the Federal-State Inspection 
Service, and certified as meeting the applicable requirements of such 
regulations.
    On May 18, 2004, the Committee recommended, by a nine to four vote, 
the establishment of a minimum size requirement of 11-row size (\61/
64\-inch diameter) and a minimum maturity requirement of 17 percent 
soluble solids for all lightly colored sweet cherry varieties shipped 
to fresh markets under the order. The Committee recommended the 
requirement become effective on April 1, 2005, which is the beginning 
of the 2005-2006 marketing season.
    Supporters of the recommendation believe that this regulation is in 
the best interests of producers and consumers. Growing lightly colored 
sweet cherries for the fresh market is more labor intensive and costly 
than producing dark colored varieties. Trees that produce lightly 
colored sweet cherries need to be pruned more heavily than the trees 
that produce dark colored sweet cherries to ensure acceptable size 
fruit. The lightly colored sweet varieties are fragile and susceptible 
to damage during handling with most lightly colored sweet cherries 
being sorted and packed by hand. Producers need to offer a quality 
product in order to recoup the higher production costs. The sale of 
small, immature or poor quality cherries results in buyer 
dissatisfaction, which reduces repeat purchases and damages the market 
for all lightly colored sweet cherries.
    Supporters of the recommendation believe that the requirements 
currently in place for Rainier variety cherries (59 FR 31917, June 21, 
1994) have benefited producers. Concern was also expressed that the 
non-regulation of new varieties of lightly colored sweet cherries would 
have an adverse effect in the future on the marketing of Rainier 
variety cherries if the newer varieties are not regulated in the same 
manner. It is difficult to distinguish between the different varieties 
of lightly colored cherries and this can result in confusion in the 
marketplace.
    Those opposed to the recommendation believe that the tonnage of the 
newer lightly colored sweet cherry varieties is not enough to impact 
the Rainier market at this time. They believe that the regulation of 
all lightly colored sweet cherries will reduce the volume of such 
cherries on the market and reduce overall returns on the crop. Some 
believe that the additional cost of inspection will increase costs with 
little added return to the producer.
    The Committee estimates that there were less than 500 tons of 
lightly colored sweet cherry varieties other than the Rainier variety 
marketed during the 2004 marketing season. By comparison, there were 
8,080 tons (Committee records) of Rainier cherries marketed from the 
production area in 2004.
    This rule adds a new provision to Sec.  923.322 to establish a 
minimum size requirement of \61/64\-inch in diameter for all lightly 
colored sweet cherries which corresponds to the 11-row size. To provide 
for variances in packing, a tolerance of 10 percent is provided for 
undersized lightly colored sweet cherries. Further, the regulation 
provides that not more than 5 percent of lightly colored sweet cherries 
in any lot can be less than \57/64\-inch in diameter, or 11\1/2\-row 
size. These tolerances are identical to those in effect for Rainier 
cherries and comparable to those in effect for dark colored sweet 
cherry varieties.
    Section 923.322 is also revised to include a requirement that any 
lot of lightly colored sweet cherries must contain a minimum of 17 
percent soluble solids. The percentage of soluble solids will be 
determined by using a refractometer to measure the sugar level in a 
composite sample of cherries. This maturity test can be taken prior to 
packing, at the time of packing, or at time of shipment, provided that 
individual lots shall not be combined with other lots to meet soluble 
solids requirements.
    This rule also changes the heading of Sec.  923.322 from 
``Washington Cherry Regulation 22'' to ``Washington Cherry Handling 
Regulation'' to more accurately describe the requirements contained 
therein.

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 rule 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 the 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 1,800 producers of sweet cherries grown in 
designated counties in Washington. In addition, there are approximately 
69 handlers subject to regulation under the order. Small agricultural 
producers are defined by the Small Business Administration (13 CFR 
121.201) as those having annual receipts of less than $750,000, and 
small agricultural service firms are defined as those whose annual 
receipts are less than $5,000,000.
    Based on a three-year (2001-2003) average fresh cherry production 
of 79,763 tons (Committee records), a three-year average producer price 
of $1,390 per ton as reported by the National Agricultural Statistics 
Service, USDA, and 1,800 Washington cherry producers, the average 
annual producer revenue is approximately $61,595. In addition, based on 
Committee records and an average 2003 f.o.b. price of $28.00 per 20-
pound container as

[[Page 7001]]

reported by AMS Market News, approximately 75 percent of the Washington 
sweet cherry handlers ship under $5,000,000 worth of cherries. Based on 
this information, the majority of Washington sweet cherry producers and 
handlers may be classified as small entities.
    This final rule establishes a minimum size requirement of 11-row 
size (\61/64\-inch diameter) and a minimum maturity requirement of 17 
percent soluble solids for all lightly colored sweet cherry varieties 
shipped to fresh markets. Previously, Rainier variety cherries were the 
only lightly colored sweet cherries under these requirements.
    Rainier and other lightly colored sweet cherry varieties are 
typically marketed from mid-June through July. AMS Market News data 
shows that prices are the highest for the earliest offerings of these 
cherries, and that such prices decline as the season progresses. In 
2003, for example, the opening f.o.b. price on June 23 ranged from 
$45.00 to $45.50 per carton. This declined to $35.00 to $36.50 a week 
later, and f.o.b. prices were $38.00 to $40.50 per carton at season's 
end for similar quality and sizes. This price trend serves as an 
incentive for producers to harvest early, which has resulted in 
immature and poor quality lightly colored sweet cherries being 
marketed.
    The Committee reports that cherry size and quality are important to 
buyers. Consistency and dependability are equally important. Shipments 
of immature, low quality, under-sized lightly colored sweet cherries in 
recent seasons have disappointed buyers and consumers. This reduces 
repeat purchases and results in declines in prices and overall sales 
volumes.
    Cherry size is related to maturity and other quality factors. That 
is, larger sized cherries tend to be sweeter and of higher overall 
quality. This is supported by prices received for different sizes of 
Bing (dark colored) cherries. AMS Market News data show that f.o.b. 
prices for 12 row sized Bing cherries (\54/64\-inch diameter) averaged 
about $18.00 per carton in mid-June 2003. At the same time, 10\1/2\ row 
sized (1-inch diameter) Bing cherries were selling for $24.50 to $26.50 
per carton. This price relationship held steady throughout the season. 
Further, the Committee has conducted research showing that larger sizes 
correlate with higher maturity levels, and that larger sizes are 
preferred by cherry consumers. While research results and prices by 
size specifically for Rainier or other lightly colored sweet cherry 
varieties are currently unavailable, industry consensus is that the 
same relationships are true for Rainier and other lightly colored sweet 
cherries, and Bings.
    The Committee discussed alternatives to this rule, including not 
establishing a minimum size and maturity requirement. The general 
consensus of the industry is that mandatory size and quality 
requirements are needed to ensure product quality and to encourage 
repeat purchases. Previous voluntary standards for lightly colored 
sweet cherries such as Rainier variety cherries have not been 
successful.
    This final rule will establish a minimum size requirement of 11-row 
size (\61/64\-inch diameter) and a minimum maturity requirement of 17 
percent soluble solids for lightly colored sweet cherry varieties 
shipped to fresh markets. Accordingly, this action will not impose any 
additional reporting or recordkeeping requirements on either small or 
large sweet cherry handlers. As with all Federal marketing order 
programs, reports and forms are periodically reviewed to reduce 
information requirements and duplications by industry and public sector 
agencies.
    As noted in the initial regulatory flexibility analysis, USDA has 
not identified any relevant Federal rules that duplicate, overlap or 
conflict with this final rule. Further, the public comments received 
concerning the proposal did not address the initial regulatory 
flexibility analysis.
    In addition, the Committee's meeting was widely publicized 
throughout the Washington sweet cherry industry and all interested 
persons were invited to attend and participate in the Committee's 
deliberations on all issues. Like all Committee meetings, the May 18, 
2004, 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 November 3, 2004 (69 FR 63958). Copies of the rule were 
mailed or sent via facsimile to all Committee members. Finally, the 
rule was made available through the Internet by USDA and the Office of 
the Federal Register. A 60-day comment period ending January 3, 2005, 
was provided to allow interested persons to respond to the proposal.
    Two comments were received during the comment period in response to 
the proposal. One commenter opposed the proposed requirements 
indicating that regulation was overly restrictive. The second commenter 
was of the view that cherries should not be regulated by size at all.
    We disagree with the commenters. Implementation of a minimum size 
of \61/64\-inch diameter and a 17 percent soluble solids requirement 
for all varieties of lightly colored cherries should help enhance their 
quality and image. With such a minimum size and maturity, the Committee 
believes that consumers will purchase more cherries, thereby increasing 
sales and improving returns to producers.
    Accordingly, based on the comments received, 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.ama.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 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.

List of Subjects in 7 CFR Part 923

    Cherries, Marketing agreements, Reporting and recordkeeping 
requirements.


0
For the reasons set forth in the preamble, 7 CFR part 923 is amended as 
follows:

PART 923--SWEET CHERRIES GROWN IN DESIGNATED COUNTIES IN WASHINGTON

0
1. The authority citation for 7 CFR part 923 continues to read as 
follows:

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


0
2. In Sec.  923.322, the section heading, paragraphs (b) introductory 
text, (b)(1), and (c) are revised to read as follows:


Sec.  923.322  Washington cherry handling regulation.

* * * * *
    (b) Size. No handler shall handle, except as otherwise provided in 
this section, any lot of cherries unless such cherries meet the 
following minimum size requirements:
    (1) For the Rainier variety and similar varieties commonly referred 
to as ``lightly colored sweet cherries,'' at least 90 percent, by 
count, of the cherries in any lot shall measure not less than \61/64\-
inch in diameter and not more than 5 percent, by count, may be less 
than \57/64\-inch in diameter.
* * * * *
    (c) Maturity. No handler shall handle, except as otherwise provided 
in this

[[Page 7002]]

section, any lot of Rainier cherries or other varieties of ``lightly 
colored sweet cherries'' unless such cherries meet a minimum of 17 
percent soluble solids as determined from a composite sample by 
refractometer prior to packing, at time of packing, or at time of 
shipment: Provided, That individual lots shall not be combined with 
other lots to meet soluble solids requirements.
* * * * *

    Dated: February 4, 2005.
Kenneth C. Clayton,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 05-2545 Filed 2-9-05; 8:45 am]
BILLING CODE 3410-02-P