[Federal Register Volume 88, Number 19 (Monday, January 30, 2023)]
[Rules and Regulations]
[Pages 5721-5724]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-01701]
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Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
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Federal Register / Vol. 88, No. 19 / Monday, January 30, 2023 / Rules
and Regulations
[[Page 5721]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Parts 920 and 944
[Doc. No. AMS-SC-21-0098]
California and Imported Kiwifruit; Handling Regulations
AGENCY: Agricultural Marketing Service, Department of Agriculture
(USDA).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This rule implements a recommendation from the Kiwifruit
Administrative Committee (Committee) to modify the handling regulations
prescribed under the Federal marketing order for kiwifruit grown in
California. This action revises the size and uniformity requirements
for all varieties of Actinidia chinensis species kiwifruit, which is
commonly known as golden kiwifruit, regulated under the marketing
order. A corresponding change is also made to the kiwifruit import
regulation as required under section 8e of the Agricultural Marketing
Agreement Act of 1937.
DATES: Effective March 1, 2023.
FOR FURTHER INFORMATION CONTACT: Barry Broadbent, Senior Marketing
Specialist, or Gary Olson, Regional Director, Western Region Field
Office, Market Development Division, Specialty Crops Program, AMS,
USDA; Telephone: (503) 326-2724, or Email: [email protected] or
[email protected].
Small businesses may request information on complying with this
regulation by contacting Richard Lower, Market Development Division,
Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, STOP
0237, Washington, DC 20250-0237; Telephone: (202) 720-2491, or Email:
[email protected].
SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553,
amends regulations issued to carry out a marketing order as defined in
7 CFR 900.2(j). This final rule is issued under Marketing Order No.
920, as amended (7 CFR part 920), regulating the handling of kiwifruit
grown in California. Part 920 (referred to as 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
Committee locally administers the Order and comprises kiwifruit growers
operating within the production area, and a public member.
This final rule is also issued under section 8e of the Act (7
U.S.C. 608e-1), which provides that whenever certain specified
commodities, including kiwifruit, are regulated under a Federal
marketing order, imports of these commodities into the United States
are prohibited unless they meet the same or comparable grade, size,
quality, or maturity requirements as those in effect for domestically
produced commodities.
The Agricultural Marketing Service (AMS) is issuing this final rule
in conformance with Executive Orders 12866 and 13563. Executive Orders
12866 and 13563 direct agencies to assess all costs and benefits of
available regulatory alternatives and, if regulation is necessary, to
select regulatory approaches that maximize net benefits (including
potential economic, environmental, public health and safety effects,
distributive impacts and equity). Executive Order 13563 emphasizes the
importance of quantifying both costs and benefits, reducing costs,
harmonizing rules, and promoting flexibility. This action falls within
a category of regulatory actions that the Office of Management and
Budget (OMB) exempted from Executive Order 12866 review.
This final rule has been reviewed under Executive Order 13175--
Consultation and Coordination with Indian Tribal Governments, which
requires agencies to consider whether their rulemaking actions would
have tribal implications. AMS has determined this final rule is
unlikely to have substantial direct effects on one or more Indian
tribes, on the relationship between the Federal Government and Indian
tribes, or on the distribution of power and responsibilities between
the Federal Government and Indian tribes.
This final rule has been reviewed under Executive Order 12988,
Civil Justice Reform. This rule is not intended to have retroactive
effect.
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 the United States
Department of Agriculture (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 no later than 20 days after the date of the entry of
the ruling.
There are no administrative procedures that must be exhausted prior
to any judicial challenge to the provisions of import regulations
issued under section 8e of the Act.
Under the provisions of the Order, fresh market shipments of
kiwifruit produced in California are required to be inspected and are
subject to grade, size, quality, maturity, pack, and container
requirements. This final rule revises the minimum size and uniformity
requirements for certain varieties of kiwifruit handled under the
Order. As required by section 8e of the Act, the revision to the
minimum size requirement will also be applied to the import regulations
for kiwifruit.
Section 920.51 of the Order provides authority for the Committee to
recommend regulations to the Secretary. Section 920.52 of the Order
provides authority for the establishment of handling regulations.
Further, Sec. 920.53 provides the authority to recommend the
modification, suspension, or termination of such regulations when the
Committee finds that industry conditions so dictate. Section 920.302
establishes the minimum grade, size, quality, maturity, pack, and
container requirements for kiwifruit handled subject to the Order.
Under the authority of Sec. 920.53, the Committee determined that the
production and marketing conditions for some varieties
[[Page 5722]]
of kiwifruit have changed and that the handling requirements should be
modified accordingly.
Prior to this rule change, the handling regulations required that
all varieties of kiwifruit be a minimum Size 45, defined as a maximum
of 55 pieces of fruit in an 8-pound sample. In addition, kiwifruit
packed in containers were required to be fairly uniform in size.
At its meeting on September 29, 2021, the Committee unanimously
recommended modifying the regulations to accommodate varieties of
Actinidia chinensis species kiwifruit that are characteristically
smaller in size and less uniform than the more common varieties grown
in California that are Actinidia deliciosa species. No other species of
kiwifruit are known to be grown in California.
This final rule relaxes the minimum size requirement for all
varieties of Actinidia chinensis species kiwifruit to Size 49, defined
in the requirements as a maximum of 64 pieces of fruit in an 8-pound
sample. In addition, the final rule exempts all varieties of Actinidia
chinensis species kiwifruit from the requirement that fruit packed in a
container be fairly uniform in size.
At the time that the Order's handling regulations were established
in 1985, practically all the kiwifruit grown in California were
varieties of the Actinidia deliciosa species. As such, the requirements
were implemented to accommodate the characteristics of those varieties.
Recently, production of varieties of Actinidia chinensis species
kiwifruit has been increasing in California. This sector of the
industry now accounts for approximately eight percent of the acreage
and five percent of the production in the state. Given the natural
characteristics of Actinidia chinensis species kiwifruit, the current
minimum size and uniformity requirements preclude some high-quality
kiwifruit from entering the fresh market. Relaxing the minimum
requirements for those varieties will allow growers to market more of
their fruit in the fresh market, increasing their total revenue. The
change is expected to benefit domestic kiwifruit growers, handlers, and
consumers.
Section 8e of the Act provides that when certain domestically
produced commodities, including kiwifruit, are regulated under a
Federal marketing order, imports of that commodity must meet the same
or comparable grade, size, quality, and maturity requirements. Since
this action modifies the minimum size requirement for varieties of
Actinidia chinensis species kiwifruit under the domestic handling
regulations, a corresponding change is made to the import regulations.
Minimum grade, size, quality, and maturity requirements for
kiwifruit imported into the United States are currently in effect under
Sec. 944.550 (7 CFR 944.550). Paragraph (a) of that section specifies
the minimum size requirement. This final rule lowers the minimum size
requirement for varieties of Actinidia chinensis species kiwifruit to
Size 49, defined as a maximum of 64 pieces of kiwifruit in an 8-pound
sample. In accordance with the Act, under the kiwifruit import
regulations, imported kiwifruit are not subject to container and pack
requirements. Accordingly, the change in the Order's uniformity
requirement does not affect the kiwifruit import requirements.
The relaxation in the size requirements for imports of Actinidia
chinensis varieties will allow a greater quantity of kiwifruit to be
imported. The change is expected to benefit kiwifruit importers and
consumers of imported kiwifruit.
Final Regulatory Flexibility Analysis
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA) (5 U.S.C. 601-612), 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 are unique in that they are brought about through
group action of essentially small entities acting on their own behalf.
Import regulations issued under the Act are based on those established
under Federal marketing orders.
There are approximately 133 kiwifruit growers in the production
area and 20 handlers subject to regulation under the Order. In
addition, there are approximately 80 importers of kiwifruit. Small
producers of kiwifruit are defined by the Small Business Administration
(SBA) as those having annual receipts less than $3,000,000. Small
agricultural service firms, which include kiwifruit handlers and
importers, are defined by the SBA as those having annual receipts of
less than $30,000,000. The SBA threshold for growers changed in between
the proposed and the final rule. Thus, AMS changed the RFA to reflect
the new amount in this final rule. The change did not impact the number
of growers considered to be small.
The USDA National Agricultural Statistics Service (NASS) reported
that total production of California kiwifruit for the 2020-2021 season
was 39,760 tons. NASS further reported that the average producer price
was $1,920 per ton over that period. Multiplying $1,920 per ton by the
production quantity of 39,760 tons yields an annual crop revenue
estimate of $76,339,200. The average annual fresh kiwifruit revenue for
each of the 133 growers for the 2020-2021 season is therefore
calculated to be $573,979 ($76,339,200 divided by 133), which is less
than the SBA threshold of $3,000,000 for small producers of kiwifruit.
Therefore, on average and given a normal distribution, the majority of
growers may be classified as small businesses.
In addition, based on information reported by USDA's Market News
Service (Market News), the average Free On Board (F.O.B.) shipping
point price for California kiwifruit over the 2020-2021 season was
$23.28 per 9 kilogram container (19.8 pounds equivalent). Multiplying
$23.28 by the shipment quantity of 4,016,162 containers (39,760 tons
times 2,000 pounds per ton divided by 19.8 pounds) yields an annual
crop revenue estimate of $93,496,251. The average annual fresh
kiwifruit revenue for each of the 20 handlers is therefore calculated
to be $4,674,813 ($93,496,251 divided by 20), which is below the SBA
threshold of $30,000,000 for agricultural service firms. Therefore, on
average and assuming a normal distribution, the majority of the
handlers may be classified as small businesses.
Further, USDA's Foreign Agricultural Service reported 80,279 metric
tons of kiwifruit were imported during the 2020-2021 season with a
reported value of $184,488,000. Using that data, the average revenue
for each of the approximately 80 kiwifruit importers would be
$2,306,100 ($184,488,000 divided by 80), which is below the $30,000,000
SBA threshold for small agricultural service firms. As such, the
majority of kiwifruit importers may be classified as small businesses.
This final rule relaxes the minimum size and uniformity
requirements prescribed in the Order's handling regulations. The final
rule lowers the minimum size requirement for all varieties of Actinidia
chinensis species kiwifruit from Size 45 to 49, defined in the
requirements as a maximum of 64 pieces of fruit in an 8-pound sample.
In addition, the final rule exempts all varieties of Actinidia
chinensis species kiwifruit from the Order's container requirement that
fruit be fairly uniform in size.
[[Page 5723]]
This action will not impose any additional costs to the industry.
It is expected to increase revenue to handlers and growers of Actinidia
chinensis species varieties of kiwifruit, as smaller size fruit, and
fruit that lacks uniformity, will be allowed to enter the market. The
quality of fruit to consumers is not expected to be significantly
affected, as relaxing the size and uniformity requirements will not
impact the Order's minimum quality requirements. All kiwifruit marketed
under the Order will continue to be packed to the minimum grade of KAC
No.1.
The Committee considered alternatives to the recommended changes,
including taking no action and continuing to regulate according to the
requirements as currently established. In addition, the Committee
considered lowering the size requirements for all varieties of
kiwifruit. However, the Committee determined that the minimum size
requirement is effective for Actinidia deliciosa varieties and that it
should not be changed. The Committee also considered establishing other
minimum sizes for Actinidia chinensis varieties higher and lower than
the minimum size recommended but believed that Size 49 will allow more
fruit to be marketed and still maintain the high standards of
California kiwifruit. Ultimately, the Committee determined that
relaxation of the handling regulation, as recommended, is in the best
interests of the growers, handlers, and consumers of California
kiwifruit and rejected all other alternatives.
Committee meetings were widely publicized throughout the California
kiwifruit industry. All interested persons were invited to attend
meetings and participate in Committee deliberations. Like all Committee
meetings, the September 27, 2021, meeting was a public meeting, and all
entities, both large and small, were able to express their views on
this issue. Also, the embassies of countries that export kiwifruit to
the United States, and known kiwifruit importers, will be notified of
this final rule upon its publication. Finally, interested persons were
invited to submit comments on the proposed rule, including the
regulatory and informational impacts of this action on small
businesses.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
Chapter 35), the Order's information collection requirements have been
previously approved by the Office of Management and Budget (OMB) and
assigned OMB No. 0581-0189, Fruit Crops. No changes in those
requirements are necessary as a result of this action. Should any
changes become necessary, they would be submitted to OMB for approval.
This final rule does not impose any additional reporting or
recordkeeping requirements on either small or large kiwifruit 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. AMS has not
identified any relevant Federal rules that duplicate, overlap, or
conflict with this final rule.
AMS is committed to complying with the E-Government Act, to promote
the use of the internet and other information technologies to provide
increased opportunities for citizen access to Government information
and services, and for other purposes.
A proposed rule concerning this action was published in the Federal
Register on June 17, 2022 (87 FR 36412). Copies of the proposed rule
were also mailed or sent via email to all California kiwifruit
handlers. A copy of the proposed rule was made available through the
internet by AMS. A 60-day comment period ending August 16, 2022, was
provided for interested persons to respond to the proposal. Three
comments were received in favor of the rule. Accordingly, no changes
have been 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:
https://www.ams.usda.gov/rules-regulations/moa/small-businesses. Any
questions about the compliance guide should be sent to Richard Lower at
the previously mentioned address in the FOR FURTHER INFORMATION CONTACT
section.
After consideration of all relevant material presented, including
the information and recommendations submitted by the Committee and
other available information, USDA has determined that this final rule
is consistent with and will effectuate the purposes of the Act.
In accordance with section 8e of the Act, the United States Trade
Representative has concurred with the issuance of this final rule.
List of Subjects
7 CFR Part 920
Kiwifruit, Marketing agreements, Reporting and recordkeeping
requirements.
7 CFR Part 944
Avocados, Food grades and standards, Grapefruit, Grapes, Imports,
Kiwifruit, Limes, Olives, Oranges, Plums, Prunes.
For the reasons set forth in the preamble, the Agricultural
Marketing Service amends 7 CFR parts 920 and 944 as follows:
PART 920--KIWIFRUIT GROWN IN CALIFORNIA
0
1. The authority citation for 7 CFR part 920 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. Amend Sec. 920.302 by:
0
a. Revising paragraphs (a)(2), (a)(4) heading, and (a)(4)(i); and
0
b. In paragraph (a)(4)(ii)(A):
0
i. Designating the table as table 1 to paragraph (a)(4)(ii)(A);
0
ii. Revising the three column headings;
0
iii. Removing the entry for ``45 or smaller'' and adding an entry for
``45'' in its place; and
0
iv. Adding an entry for ``49'' in numerical order and footnotes 1 and 2
at the end of the table.
The revisions and additions read as follows:
Sec. 920.302 Grade, size, pack, and container regulations.
(a) * * *
(2) Size requirements. Such kiwifruit, except for varieties of the
Actinidia chinensis species, shall be at least a minimum Size 45,
defined as a maximum of 55 pieces of fruit in an 8-pound sample.
Varieties of the Actinidia chinensis species shall be at least a
minimum Size 49, defined as a maximum of 64 pieces of fruit in an 8-
pound sample.
* * * * *
(4) Pack requirements. (i) Kiwifruit packed in containers with cell
compartments, cardboard fillers, or molded trays shall be of proper
size for the cells, fillers, or molds in which they are packed. Such
fruit, except for varieties of the Actinidia chinensis species, shall
be fairly uniform in size.
(ii)(A) * * *
[[Page 5724]]
Table 1 to Paragraph (a)(4)(ii)(A)--Size Designation and Size Variation
Chart
------------------------------------------------------------------------
Maximum number of Size variation
Size designation fruit per 8-pound tolerance
sample (diameter) \1\
------------------------------------------------------------------------
* * * * * * *
45.............................. 55 \1/4\-inch (6.4
mm).
\2\ 49.......................... 64 Not applicable.
------------------------------------------------------------------------
\1\ Not applicable to Actinidia chinensis species varieties.
\2\ Applicable only to Actinidia chinensis species varieties.
* * * * *
PART 944--FRUITS; IMPORT REGULATIONS
0
3. The authority citation for 7 CFR part 944 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
4. Amend Sec. 944.550 by revising paragraph (a) to read as follows:
Sec. 944.550 Kiwifruit import regulation.
(a) Pursuant to section 8e of the Agricultural Marketing Agreement
Act of 1937, as amended, the importation into the United States of any
kiwifruit is prohibited unless such kiwifruit meets all the
requirements of a U.S. No. 1 grade as defined in the United States
Standards for Grades of Kiwifruit (7 CFR 51.2335 through 51.2340),
except that the kiwifruit shall be ``not badly misshapen,'' and an
additional tolerance of 16 percent is provided for kiwifruit that is
``badly misshapen,'' and except that such kiwifruit shall have a
minimum of 6.2 percent soluble solids. Such fruit, except for varieties
of the Actinidia chinensis species, shall be at least Size 45, which
means there shall be a maximum of 55 pieces of fruit in an 8-pound
sample. Varieties of the Actinidia chinensis species shall be at least
Size 49, which means there shall be a maximum of 64 pieces of fruit in
an 8-pound sample. The average weight of all samples in a specific lot
must weigh at least 8 pounds (3.632 kilograms), provided that no
individual sample may be less than 7 pounds 12 ounces (3.472
kilograms).
* * * * *
Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2023-01701 Filed 1-27-23; 8:45 am]
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