[Federal Register Volume 73, Number 132 (Wednesday, July 9, 2008)]
[Rules and Regulations]
[Pages 39214-39216]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-15522]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1216

[Docket No.: AMS-FV-08-0001; FV-08-701 FR]


Peanut Promotion, Research, and Information Order; Amendment to 
Primary Peanut-Producing States and Adjustment of Membership

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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

SUMMARY: The Department of Agriculture (Department) is adopting, as a 
final rule, without change, an interim final rule that added a producer 
member and alternate from the State of Mississippi to the National 
Peanut Board (Board). The change was proposed by the Board, which 
administers the nationally coordinated program, in accordance to the 
provisions of the Peanut Promotion, Research, and Information Order 
(Order) which is authorized under the Commodity Promotion, Research, 
and Information Act of 1996 (1996 Act). This change is made because 
Mississippi is now considered a major peanut-producing state based on 
the Board's review of the geographical distribution of the production 
of peanuts. The Order requires a review of the geographical 
distribution of the production of peanuts at least every five years. 
The addition of a member from Mississippi will provide for additional 
representation from another primary peanut-producing state.

DATES: Effective Date: August 8, 2008.

FOR FURTHER INFORMATION CONTACT: Jeanette Palmer, Marketing Specialist, 
Research and Promotion Branch, Fruit and Vegetable Programs, AMS, USDA, 
1400 Independence Avenue, SW., Room 0632, Stop 0244, Washington, DC 
20250-0244; telephone: (202) 720-9915; or fax: (202) 205-2800; or e-
mail: [email protected].

SUPPLEMENTARY INFORMATION: This rule is issued under the Peanut 
Promotion, Research, and Information Order [7 CFR Part 1216]. The Order 
is authorized under the Commodity Promotion, Research, and Information 
Act of 1996 [7 U.S.C. 7411-7425].

Executive Order 12866

    The Office of Management and Budget has waived the review process 
required by Executive Order 12866 for this action.

Executive Order 12988

    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. The rule is not intended to have a retroactive effect 
and will not affect or preempt any other State or Federal law 
authorizing promotion or research relating to an agricultural 
commodity.
    The 1996 Act provides that any person subject to an order may file 
a written petition with the Department of Agriculture if they believe 
that the order, any provision of the order, or any obligation imposed 
in connection with the order, is not established in accordance with the 
law. In any petition, the person may request a modification of the 
order or an exemption from the order. The petitioner is afforded the 
opportunity for a hearing on the petition. After a hearing, the 
Department would rule on the petition. The 1996 Act provides that the 
district court of the United States in any district in which the 
petitioner resides or conducts business shall have the jurisdiction to 
review the Department's ruling on the petition, provided a complaint is 
filed not later than 20 days after the date of the entry of the ruling.

Regulatory Flexibility Analysis

    In accordance with the Regulatory Flexibility Act (RFA) [5 U.S.C. 
601-612], AMS has considered the economic impact of this rule on small 
entities and has prepared this final regulatory analysis impact on a 
substantial number of small entities. 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.
    The Small Business Administration (SBA) defines, in 13 CFR part 
121, small agricultural producers as those having annual receipts of no 
more than $750,000 and small agricultural service firms as having 
receipts of no more than $6,500,000.
    There are approximately 10,840 producers and 33 handlers of peanuts 
who are subject to the program. Most producers would be classified as 
small businesses under the criteria established by the SBA, and most of 
the handlers would not be classified as small businesses.
    The Department's National Agricultural Statistics Service (NASS), 
reports U.S. peanut production from the 10 major peanut-producing 
states. The combined production from these states totaled 3.74 billion 
pounds in 2007. NASS data indicates that Georgia was the largest 
producer (44 percent of the total U.S. production), followed by Texas 
(20 percent), Alabama (11 percent), Florida (9 percent), North Carolina 
(7 percent), South Carolina (5 percent), Mississippi (2 percent), 
Oklahoma (2 percent), Virginia (2 percent), and New Mexico (1 percent). 
According to the 2002 Census of Agriculture, small amounts of peanuts 
were also grown in six other states. NASS data indicates that the farm 
value of the peanuts produced in the top 10 states in 2007 was $763 
million.
    Three main types of peanuts are grown in the United States: 
Runners, Virginia, and Spanish. The southeast growing region grows 
mostly the medium-kernel Runner peanuts. The southwest growing region 
used to grow two-thirds Spanish and one-third Runner peanuts, but now 
more Runners than Spanish are grown. Virtually all of the Spanish 
peanut production is in Oklahoma and Texas. In the Virginia-Carolina 
region, mainly large-kernel Virginia peanuts are grown. New Mexico 
grows a fourth type of peanut, the Valencia.
    According to the Department's Agricultural Statistics report, in 
2005 there were 10,840 commercial producers of peanuts in the United 
States. If that number of growers is divided into the total U.S. 
production in 2005, the resulting average is 449,249 pounds of peanuts 
per grower. Peanuts produced during 2005 provided average gross sales 
of $77,808 per peanut producer, and the total value of the 2005 crop 
was approximately $843 million. During the 2005/2006 marketing season 
(which began August 1, 2005), the per capita consumption of peanuts in 
the United States was 6.6 pounds, the same as in the 2004/2005 season.
    Peanut manufacturers produce three principal peanut products: 
peanut butter, packaged nuts (including salted, unsalted, flavored, and 
honey-roasted nuts), and peanut candies. In most years, half of all 
peanuts produced in

[[Page 39215]]

the United States for edible purposes are used to manufacture peanut 
butter. Packaged nuts account for almost one-third of all processed 
peanuts. Some of these (commonly referred to as ``ballpark'' peanuts) 
are roasted in the shell, while a much larger quantity is used as 
shelled peanuts packed as dry-roasted peanuts, salted peanuts, and 
salted mixed nuts. Some peanuts are ground to produce peanut granules 
and flour. Other peanuts are crushed to produce oil.
    According to the Department's Foreign Agricultural Service, exports 
of the United States peanuts (including peanut meal, oil, and peanut 
butter expressed in peanut equivalents) totaled 743 million in-shell 
equivalent pounds in calendar year 2006, with a value of $228 million 
(U.S. point of departure for the foreign country). Of the total 
quantity, 60 percent was shelled peanuts used as nuts, 19 percent was 
in peanut butter, 8 percent was blanched or otherwise prepared or 
preserved peanuts, 4 percent was in-shell peanuts, and 3 percent was 
shelled oil stock peanuts. The remaining 6 percent represents peanuts 
exported as either a meal or oil.
    The major destinations in 2006 for domestic shelled peanuts for use 
as nuts are Canada, Mexico, the Netherlands, and Russia. Blanched or 
otherwise prepared peanuts are sent mainly to Western Europe, 
especially Norway, Denmark, and Spain. In-shell peanuts are mainly 
exported to Canada and various countries in Western Europe. Peanut 
butter is sent to many countries, with the largest amounts going to 
Canada, Mexico, and Germany. Peanut oil and oil stock peanuts are 
exported world-wide, but major destinations can vary from year to year.
    Approximately 164 million in-shell equivalent pounds of peanuts and 
peanut butter were imported in 2006 with a combined value (freight on 
board country of origin) of $45 million.
    Peanut butter accounted for about 63 percent of the total quantity 
of nuts (in-shell basis) imported in 2006. Most peanut butter imports 
come from Canada, Mexico, and Argentina. The other major import 
category--processed peanuts, are shipped mainly from China. Imports of 
oil stock shelled peanuts and peanut meal were negligible in the United 
States.
    Most peanuts produced in other countries are crushed for oil and 
protein meal. The United States is the main producer of peanuts used in 
such edible products as peanut butter, roasted peanuts, and peanut 
candies. Peanuts are one of the world's principal oilseeds, ranking 
fourth behind soybeans, cottonseed, and rapeseed. India and China 
usually account for half of the world's peanut production.
    The Board is currently composed of 10 producer members and their 
alternates. There is one producer member and alternate from each of the 
nine major peanut-producing states (in descending order--Georgia, 
Texas, Alabama, Florida, North Carolina, South Carolina, Oklahoma, 
Virginia, and New Mexico) and one at-large member and alternate 
representing all other peanut-producing states. However, based on the 
Board's review of the geographical distribution of the production of 
peanuts, Mississippi is now considered a major peanut-producing state. 
The Order requires this review at least every five years. The Board 
membership would move from 10 members and their alternates to 11 
members and their alternates.
    The addition of a producer member and alternate would be consistent 
with section 1216.40(b) of the Order which indicates that at least once 
during each five-year period, the Board shall review the geographical 
distribution of peanuts and make recommendation to the Secretary of 
Agriculture (Secretary) to continue without change or whether changes 
should be made in the number of representatives on the Board to reflect 
changes in the geographical distribution of the production of peanuts.
    The Order became effective on July 30, 1999, and it contains 
provision to add a producer member and alternate if the State meets and 
maintains a three-year average production of at least 10,000 tons of 
peanuts. At the Board's December 4-5, 2007, meeting, the Board voted 
unanimously to add the State of Mississippi as a primary peanut-
producing state contingent on the NASS data for the 2007 crop year 
showing that Mississippi has maintained a three-year average annual 
peanut production of at least 10,000 tons per year. The most recent 
NASS data shows that for the years 2005, 2006, and 2007 Mississippi 
produced 22,400 tons, 23,200 tons, and 29,700 tons of peanuts 
respectively. Based on this data, the three-year average annual peanut 
production for Mississippi totals 22,410 tons per year (67,232 divided 
by 3), which well exceeds the threshold set in the Order.
    With regard to alternatives, the Board reviewed the peanut 
distribution for all the minor peanut-producing states, and Mississippi 
was the only State that met the Order's requirement for a three-year 
average peanut production of at least 10,000 tons.
    Nominations and appointments to the Board are conducted pursuant to 
sections 1216.40, 1216.41, and 1216.43 of the Order. According to these 
sections, appointments to the Board are made by the Secretary from a 
slate of nominated candidates. Pursuant to section 1216.41(a) of the 
Order, eligible peanut producer organizations within the State shall 
nominate two qualified persons for each member and each alternate 
member. The nomination meeting must be announced 30 days in advance. 
The nominees should be elected at an open meeting among peanut 
producers eligible to serve on the Board. At the nomination meeting, 
the Department will be present to oversee and to verify eligibility and 
count ballots. The nominees for the producer member and alternate 
member are then submitted to the Secretary for appointment to the 
Board.
    In accordance with the Office of Management and Budget (OMB) 
regulation [5 CFR Part 1320] which implements the Paperwork Reduction 
Act of 1995 [44 U.S.C. Chapter 35], the background form, which 
represents the information collection and recordkeeping requirements 
that may be imposed by this rule, was previously submitted to and 
approved by OMB under OMB Number 0505-0001.
    The public reporting burden is estimated to increase by an average 
0.5 hours per response for each of the four producers. The estimated 
annual cost of providing the information by the four producers would be 
$19.80 or $4.95 per producer. This additional burden will be included 
in the existing information collections approved for use under OMB 
Number 0505-0001.
    With regard to information collection requirements, adding a 
producer member and alternate member representing the State of 
Mississippi for the Board means that four additional producers will be 
required to submit background forms to the Department in order to be 
considered for appointment to the Board. Four producers will be 
affected because two names must be submitted to the Secretary for 
consideration for each position on the Board. However, serving on the 
Board is optional, and the burden of submitting the background form 
would be offset by the benefits of serving on the Board. The estimated 
annual cost of providing the information by four producers would be 
$19.80 for all four producers or $4.95 per producer.
    The Department has not identified any relevant Federal rules that 
duplicate, overlap, or conflict with this rule.

Background

    The Order became effective on July 30, 1999, and is authorized 
under the

[[Page 39216]]

1996 Act. The Board is composed of 10 producer members and their 
alternates: one member and alternate from each primary peanut-producing 
state (in descending order--Georgia, Texas, Alabama, Florida, North 
Carolina, South Carolina, Oklahoma, Virginia, and New Mexico) and one 
at-large member and alternate collectively from the minor peanut-
producing states. The members and alternates are nominated by producers 
or producer groups.
    Under the Order, the Board administers a nationally coordinated 
program of promotion, research, and information designed to strengthen 
the position of peanuts in the market place and to develop, maintain, 
and expand the demand for peanuts in the United States. Under the 
program, all peanut producers pay an assessment of one percent of the 
total value of all farmer's stock peanuts. The assessments are remitted 
to the Board by handlers and, for peanuts under loan, by the Commodity 
Credit Corporation.
    Pursuant to section 1216.40(b) of the Order, at least once in each 
five-year period, the Board shall review the geographical distribution 
of peanuts in the United States and make a recommendation to the 
Secretary to continue without change or whether changes should be made 
in the number of representatives on the Board to reflect changes in the 
geographical distribution of the production of peanuts.
    The Board reviewed the most recent NASS data and it reported that 
in 2005, 2006, and 2007 Mississippi produced 22,400 tons, 23,200 tons, 
and 29,700 tons of peanuts respectively. Based on this data, the three-
year average annual peanut production for Mississippi totals 22,410 
tons per year (67,232 divided by 3) which exceeds the requirement set 
in the Order of 10,000 pounds per year to become a major peanut-
producing state. In addition, NASS data showed that Mississippi has 
produced two percent of the total United States peanut crop which is 
the same as Oklahoma and Virginia, two of the primary peanut-producing 
states. At the Board's December 4-5, 2007, meeting, the Board voted 
unanimously to add Mississippi as a primary peanut-producing state.
    Therefore, the addition of a producer member and alternate would 
carry out the recommendations of the Board. This action will add to the 
Board a member and an alternate from Mississippi which has become a 
primary peanut-producing state. The addition of a producer member and 
alternate member would allow Mississippi representation on the Board's 
decision making and also potentially provide an opportunity to increase 
diversity on the Board.
    Furthermore, this rule would make amendments to sections 1216.15 
and 1216.21 of the Order to add the State of Mississippi as a primary 
peanut-producing state. Also, this rule would revise sections 
1216.40(a) and 1216.40(a)(1) of the Order to specify that the Board 
will be composed of 11 peanut producer members and their alternates 
rather than 10.
    Nominations and appointments to the Board are conducted pursuant to 
sections 1216.40, 1216.41, and 1216.43 of the Order. According to these 
sections, appointments to the Board are made by the Secretary from a 
slate of nominated candidates. Pursuant to section 1216.41(a) eligible 
peanut producer organizations within the State as certified pursuant to 
section 1216.70 shall nominate two qualified persons for each member 
and each alternate member. The nomination meeting must be announced 30 
days in advance. The nominees should be elected at an open meeting 
among peanut producers eligible to serve on the Board. At the 
nomination meeting, the Department was present to oversee and to verify 
eligibility and count ballots. The nominees for the producer member and 
alternate member will be submitted to the Secretary for appointment to 
the Board.
    An interim final rule concerning this action was published in the 
Federal Register on March 20, 2008 (73 FR 14919). Copies of the rule 
were made available through the Internet by the Department and the 
Office of the Federal Register. That rule provided a 30-day comment 
period which ended on April 21, 2008. Three comments were received by 
the deadline.
    Three favorable comments were received. The commenters state the 
addition of Mississippi as a major peanut-producing state will ensure 
that all growers have the opportunity to be equitably represented in 
setting the vision and goals of the Peanut Promotion, Research, and 
Information Order.
    An interim final rule was published in the Federal Register on 
March 20, 2008 (73 FR 14919), allowing the Board to begin the 
nomination process to fill the Mississippi member and alternate 
positions. As a result, the Mississippi nomination process began in 
April 2008 to allow Mississippi to have representation on the Board for 
the next term of office beginning January 1, 2009, and ending December 
31, 2011.
    After consideration of all relevant material presented, the Board's 
recommendation, and other information, it is hereby found that this 
rule is consistent with and will tend to effectuate the declared policy 
of the 1996 Act and therefore should be adopted as a final rule, 
without change.

List of Subjects in 7 CFR Part 1216

    Administrative practice and procedure, Advertising, Consumer 
information, Marketing agreements, Peanut promotion, Reporting and 
recordkeeping requirements.

PART 1216--PEANUT PROMOTION, RESEARCH, AND INFORMATION ORDER

0
Accordingly, the interim final rule amending 7 CFR part 1216 which was 
published at 73 FR 14919 on March 20, 2008, is adopted as a final rule 
without change.

    Dated: July 2, 2008.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E8-15522 Filed 7-8-08; 8:45 am]
BILLING CODE 3410-02-P