[Federal Register Volume 71, Number 148 (Wednesday, August 2, 2006)]
[Rules and Regulations]
[Pages 43641-43643]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-12410]



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  Federal Register / Vol. 71, No. 148 / Wednesday, August 2, 2006 / 
Rules and Regulations  

[[Page 43641]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 922

[Docket No. FV06-922-2 IFR]


Apricots Grown in Designated Counties in Washington; Temporary 
Relaxation of the Minimum Grade Requirement

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

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SUMMARY: This rule relaxes the minimum grade requirement prescribed 
under the Washington apricot marketing order for the 2006 shipping 
season only. The marketing order regulates the handling of fresh 
apricots grown in designated counties in the State of Washington, and 
is administered locally by the Washington Apricot Marketing Committee 
(Committee). This rule relaxes the minimum grade requirement for fresh 
apricots from Washington No. 1 grade to Washington No. 2 grade. This 
rule will enable handlers to ship more fruit into fresh market 
channels, taking into consideration hail damage caused to Washington 
apricots during the growing season. This change is expected to increase 
returns to producers and to make more fresh apricots available to 
consumers.

DATES: Effective August 3, 2006, through March 31, 2007. Comments 
received by October 2, 2006 will be considered prior to issuance of a 
final rule.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent to the Docket Clerk, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA, 1400 Independence Avenue, SW., STOP 0237, Washington, DC 
20250-0237; Fax: (202) 720-8938; E-mail: [email protected], or 
Internet: 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 in the Office 
of the Docket Clerk during regular business hours or can be viewed at: 
http://www.ams.usda.gov/fv/moab.html.

FOR FURTHER INFORMATION CONTACT: Robert J. Curry or Gary D. Olson, 
Northwest Marketing Field Office, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, 1220 SW Third Avenue, 
Suite 385, Portland, Oregon 97204-2807; Telephone: (503) 326-2724; Fax: 
(503) 326-7440.
    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 and Order No. 922 (7 CFR part 922) regulating the handling of 
apricots 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 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. 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 rule relaxes the minimum grade requirement for fresh apricots 
from Washington No. 1 grade to Washington No. 2 grade. This rule will 
enable handlers to ship more fruit into fresh market channels, taking 
into consideration hail damage caused to Washington apricots during the 
growing season. This change is expected to increase returns to 
producers and to make more fresh apricots available to consumers. The 
minimum grade requirement will revert to Washington No. 1 grade on 
April 1, 2007, for the 2007 and future seasons.
    Section 922.52 of the order authorizes the issuance of regulations 
for grade, size, quality, maturity, pack, and container for any variety 
of apricots grown in the production area. Section 922.53 further 
authorizes the modification, suspension, or termination of regulations 
issued pursuant to Sec.  922.52. Section 922.55 provides that whenever 
apricots are regulated pursuant to Sec. Sec.  922.52 or 922.53, such 
apricots must be inspected by the Federal-State Inspection Service, and 
certified as meeting the applicable requirements of such regulations.
    Minimum grade, maturity, color, and size requirements for 
Washington apricots regulated under the order are specified in Sec.  
922.321 Apricot Regulation 21. Section 922.321 provides, in part, that 
no handler shall handle any container of apricots unless such apricots 
grade not less than Washington No. 1, except for shipments subject to 
exemption under the regulation. In addition, the section provides that 
the Moorpark variety in open containers must be generally well matured. 
That section also provides that, with the exception of exempt 
shipments, apricots must be at least reasonably uniform in color, and 
be not less than 1\5/8\ inches in diameter, except

[[Page 43642]]

for the Blenheim, Blenril, and Tilton varieties which must be not less 
than 1\1/4\ inches in diameter. Individual shipments of apricots are 
exempt from these requirements if sold for home use only, do not, in 
the aggregate, exceed 500 pounds net weight, and each container is 
stamped or marked with the words ``not for resale.''
    This rule revises paragraph (a)(1) of Sec.  922.321 by temporarily 
changing the minimum grade requirement for fresh shipments of apricots 
from Washington No. 1 to Washington No. 2 for the 2006 season only. The 
Washington No. 1 minimum grade requirement will resume April 1, 2007, 
for the 2007 season and future seasons.
    Based on a request from a handler representing several producers, 
the Committee recommended by a vote of nine to one that the grade 
requirement be relaxed for the 2006 season to facilitate the handling 
of fruit damaged by hail. The Committee requested that this relaxation 
be effective by the beginning of the 2006 Washington apricot shipping 
season, which is expected to be around July 1, 2006.
    The Committee meets prior to and during each season to consider 
recommendations for modification, suspension, or termination of the 
regulatory requirements for Washington apricots which have been issued 
on a continuing basis. Committee meetings are open to the public and 
interested persons may express their views at these meetings. The USDA 
reviews information submitted by, and recommendations from, the 
Committee and other available information to determine whether 
modification, suspension, or termination of the regulatory requirements 
would tend to effectuate the declared policy of the Act.
    The Committee has conveyed to USDA that widely scattered hail 
damage was reported within the Washington apricot production area as a 
result of late spring storms. The severe weather conditions resulted in 
damage to the crop making it difficult for apricots to meet the minimum 
grade requirements of Washington No. 1. The Committee's original crop 
estimate for the 2006 season was established at 5,000 tons. With the 
full extent of hail damage unknown at this time, the Committee has not 
established a revised crop estimate. However, taking into account the 
reported damage, this rule provides for the handling of a larger 
portion of the Washington apricot crop this season than would be 
allowed if the minimum grade requirement were to remain at Washington 
No. 1. Relaxation of the grade requirement for the 2006 Washington 
apricot crop is intended to increase fresh shipments to meet consumer 
needs and improve returns to producers.
    This rule relaxes the grade requirement specified in Sec.  922.321. 
This rule will not effect the color and minimum size requirements for 
all varieties or the well matured requirements for the Moorpark 
variety.

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 rule 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 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 300 apricot producers within the regulated 
production area and approximately 22 regulated handlers. 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 $6,500,000.
    For the 2005 apricot shipping season, the Washington Agricultural 
Statistics Service prepared a preliminary report showing that the total 
5,600 ton apricot utilization sold for an average of $997 per ton. 
Based on the number of producers in the production area (300), the 
average annual producer revenue from the sale of apricots in 2005 can 
thus be estimated at approximately $18,611.
    Average revenue per handler can be estimated using f.o.b. prices. 
According to USDA's Market News Service, 2005 fresh apricot f.o.b. 
prices ranged from $15.00 to $20.00 per 24-pound loose-pack container, 
and from $14.00 to $24.00 for 2-layer tray pack containers (which weigh 
an average of about 20 pounds each). Total apricot sales revenue at the 
f.o.b. shipper level can be estimated by taking the midpoints of each 
of the two ranges ($17.50 and $19.00) as representative annual average 
prices for each of the container types. The 2005 season fresh apricot 
pack-out of 4,471 tons can be assumed to be equally divided between the 
two container types, yielding an estimated quantity packed in each 
container type of 2235.5 tons, or 4.471 million pounds. Dividing this 
quantity by the pounds per container yields the following handler sales 
revenue estimates: (a) 186,292 24-pound loose-pack containers, with an 
average price of $17.50, valued at $3,260,110 and (b) 223,550 two-layer 
tray pack containers, with an average price of $19.00, valued at 
$4,246,500. Combining the estimated handler sales revenue for the two 
container types ($7,506,610) and dividing by the number of handlers 
(22) yields an annual average fresh apricot sales revenue estimate per 
handler of $341,210. Since this figure is well under $750,000 (the SBA 
definition of the minimum sales of a large agricultural service firm), 
it is reasonable to assume that the majority of producers and handlers 
of Washington apricots may be classified as small entities.
    This rule revises paragraph (a)(1) of Sec.  922.321 by temporarily 
changing the minimum grade requirement for fresh shipments of apricots 
from Washington No. 1 to Washington No. 2 for the 2006 season only. The 
Washington No. 1 minimum grade requirement will resume April 1, 2007, 
for the 2007 season and future seasons. Section 922.52 of the order 
authorizes the issuance of regulations for grade, size, quality, 
maturity, pack, and container for any variety of apricots grown in the 
production area. Section 922.53 further authorizes the modification, 
suspension, or termination of regulations issued pursuant to Sec.  
922.52.
    The Committee anticipates that this rule will not negatively impact 
small businesses. This rule relaxes the minimum grade requirement in 
the order's handling regulations and should provide enhanced marketing 
opportunities.
    Given the emergency nature of the relaxation, the Committee's 
recommendation was made via the vote-by-mail procedures of the order. 
With ten of the twelve members responding, nine members supported the 
temporary grade change and one member opposed it. The only alternative 
to a grade relaxation offered on the ballot was to leave the minimum 
grade at Washington No. 1, which was not adopted.
    This rule will not impose any additional reporting or recordkeeping 
requirements on either small or large apricot 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.

[[Page 43643]]

    AMS is committed to compliance with the Government Paperwork 
Elimination Act (GPEA), which requires Government agencies in general 
to provide the public the option of submitting information or 
transacting business electronically to the maximum extent possible.
    In addition, USDA has not identified any relevant Federal rules 
that duplicate, overlap or conflict with this rule.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/fv/moab.html. Any questions about the compliance 
guide should be sent to Jay Guerber at the previously mentioned address 
in the FOR FURTHER INFORMATION CONTACT section.
    This rule invites comments on relaxation of the minimum grade 
requirement under the Washington apricot marketing order. Any comments 
received will be considered prior to finalization of this rule.
    After consideration of all relevant material presented, including 
the Committee's recommendation, and other information, it is found that 
the minimum grade requirement in Sec.  922.321 should be temporarily 
relaxed from Washington No. 1 grade to Washington No. 2 grade in order 
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 good cause exists for not postponing the effective date 
of this rule until 30 days after publication in the Federal Register 
because: (1) This rule relaxes the minimum grade requirement for 
Washington apricots for the 2006 shipping season; (2) Washington 
apricot handlers are aware of this recommendations and need no 
additional time to comply with the relaxed requirements; (3) this rule 
should be in effect as close as possible to July 1, 2006, the date 
shipments of the 2006 Washington apricot crop are expected to begin; 
and (4) this rule provides a 60-day comment period, and any comments 
received will be considered prior to finalization of this rule.

List of Subjects in 7 CFR Part 922

    Apricots, Marketing agreements, Reporting and recordkeeping 
requirements.


0
For the reasons set forth in the preamble, 7 CFR Part 922 is amended as 
follows:

PART 922--APRICOTS GROWN IN DESIGNATED COUNTIES IN WASHINGTON

0
1. The authority citation for 7 CFR Part 922 continues to read as 
follows:

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


Sec.  922.321  [Amended]

0
2. Section 922.321 is amended by revising paragraph (a)(1) to read as 
follows:
    (a) * * *
    (1) Minimum grade and maturity requirements. Such apricots that 
grade not less than Washington No. 1 and are at least reasonably 
uniform in color: Provided, That during the period July 1, 2006, 
through March 31, 2007, the minimum grade requirement for such apricots 
shall be not less than Washington No. 2; Provided further, That such 
apricots of the Moorpark variety in open containers shall be generally 
well matured: and
* * * * *

    Dated: July 27, 2006.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E6-12410 Filed 8-1-06; 8:45 am]
BILLING CODE 3410-02-P