[Federal Register: August 22, 2005 (Volume 70, Number 161)]
[Rules and Regulations]
[Page 48839-48842]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr22au05-2]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 920
[Docket No. FV05-920-1 FR]
Kiwifruit Grown in California; Relaxation of Pack Requirements
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
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SUMMARY: This rule revises the pack requirements for California
kiwifruit under the California kiwifruit marketing order (order). The
order regulates the handling of kiwifruit grown in California and is
administered locally by the Kiwifruit Administrative Committee
(Committee). This rule requires that kiwifruit marked as Size 39 or 42
not vary in diameter by more than \3/8\ inch, regardless of pack type.
In addition, the three tables that are currently under the pack
regulation will be consolidated into one. By allowing handlers to
utilize a single table for kiwifruit size designations and size
variation tolerances regardless of pack or container, this rule is
expected to simplify requirements for the industry, reduce handler
packing costs, increase grower returns, and increase flexibility in
handler packing operations.
EFFECTIVE DATE: August 23, 2005.
FOR FURTHER INFORMATION CONTACT: Shereen Marino, Marketing Specialist,
California Marketing Field Office, Marketing Order Administration
Branch, Fruit and Vegetable Programs, AMS, USDA; 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: Jay.Guerber@usda.gov.
SUPPLEMENTARY INFORMATION: This final rule is issued under Marketing
Order No. 920 as amended (7 CFR part 920), regulating the handling of
kiwifruit grown in California, 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
[[Page 48840]]
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 will 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 revises the pack requirements for California kiwifruit
under the order. This rule requires that Size 39 and Size 42 fruit not
vary in size by more than \3/8\ inch, regardless of pack type. The
Committee unanimously recommended these changes at its March 2, 2005,
meeting.
Currently, three tables are included under the pack regulation to
designate sizes and list the size variances permitted for the different
pack arrangements used in the industry. This rule consolidates the
three tables into one table that lists size designations with
applicable size variation tolerances for kiwifruit regardless of the
pack or container type. This rule is expected to simplify requirements
for the industry, reduce handler packing costs, increase grower
returns, and increase flexibility in handler packing operations.
Section 920.52 of the order authorizes the establishment of pack
requirements. Section 920.302(a)(4) of the order's regulations
specifies pack requirements for fresh shipments of California
kiwifruit. Pack requirements include the specific arrangement, size,
weight, count, or grade of a quantity of kiwifruit in a particular type
and size of container.
Section 920.302 of the order's regulations specifies grade, size,
pack, and container regulations for the fresh shipment of California
kiwifruit. This section contains three tables regarding pack. One table
in Sec. 920.302(a)(4)(iii) specifies size designations for kiwifruit
packed in volume fill containers (such as bags or bulk containers).
These size designations are based on the maximum number of pieces of
fruit per 8-pound sample. Two tables in Sec. 920.302 specify size
variation tolerances. One table in Sec. 920.302(a)(4)(ii)(B) is
applicable to volume fill containers and lists size designations with
the corresponding size variation tolerance listed by diameter. The
other table in Sec. 920.302(a)(4)(ii)(A) is applicable to kiwifruit
packed in trays and lists the variation tolerance in diameter by count
(number of pieces of kiwifruit packed in a tray).
Since 1989, there have been two different size variation tolerances
for Size 39 and Size 42 kiwifruit, depending on style of pack. The
majority of Size 39 and Size 42 kiwifruit is initially packed in volume
fill containers and must meet a size variation tolerance of \3/8\-inch.
It has become more common for some of the fruit to then be restyled
(repacked) into trays. In fact, the current estimate is that 10 percent
of the crop is restyled into trays. All kiwifruit restyled within the
production area must be reinspected.
Restyling fruit from volume fill containers into trays may require
resizing the fruit because the size variation tolerance differs for the
two containers. Fruit packed in trays that is 39 and 42 count must meet
a size variation tolerance of \1/4\-inch. In order to meet the more
restrictive \1/4\-inch tolerance, handlers must resize the fruit.
Resizing is costly and slows down the restyling process. In addition,
during the initial packing process, pack styles can change several
times daily depending upon market demand. Resizing may also reduce
returns to growers. Thus, the Committee recommended changing the size
variation requirement for Size 39 and Size 42 kiwifruit from \1/4\ inch
to \3/8\ inch when packed in cell compartments, cardboard fillers, or
molded trays.
The Committee also recommended revising the regulations to specify
one standard size variation tolerance of \3/8\-inch for Size 39 and
Size 42 kiwifruit, regardless of whether the fruit is packed in volume
fill containers or trays. To facilitate this change the three tables
under the pack regulation will be consolidated into one that lists both
size designations and their applicable size variation tolerances for
fruit packed in all container types. Additionally, clarifying language
that was inadvertently omitted from under the first table (Count) in
prior rulemaking will be restored. The language clarifies that the
average weight of all sample units in a lot must weigh at least 8
pounds, but no sample unit may be more than 4 ounces less than 8
pounds. This rule is expected to simplify requirements for the
industry, reduce handler packing costs, increase grower returns, and
increase flexibility in handler packing operations. Section 920.302 is
revised accordingly.
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 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 45 handlers of California kiwifruit subject
to regulation under the marketing order and approximately 275 growers
in the production area. Small agricultural service firms are defined by
the Small Business Administration (13 CFR 121.201) as those whose
annual receipts are less than $6,000,000, and small agricultural
producers are defined as those whose annual receipts are less than
$750,000. None of the 45 handlers subject to regulation have annual
kiwifruit sales of at least $6,000,000. In addition, six growers
subject to regulation have annual sales exceeding $750,000. Therefore,
a majority of the kiwifruit handlers and growers may be classified as
small entities.
This rule relaxes the pack requirements currently specified in
Sec. 920.302 for kiwifruit. The rule creates one standard size
variation tolerance to be applied uniformly to all container types.
Additionally, the three tables currently under the pack regulation will
be consolidated into one. By allowing handlers to utilize a single
table for kiwifruit size designations and size variation tolerances,
regardless of pack or container, this rule is expected to simplify
requirements for the industry, reduce handler packing costs, increase
grower returns, and increase flexibility in handler packing operations.
Authority for this action is provided in Sec. 920.52 of the order,
which authorizes the establishment of pack requirements.
[[Page 48841]]
The impact of this change on handlers was discussed by the
Committee. Approximately 10 percent of shipments are restyled from a
volume fill container to a tray pack. Based on an industry survey,
restyling costs an average of $.07 per tray equivalent. Since there
will no longer be a need for handlers to resize the fruit when
restyling from a volume fill container to a tray pack, it is estimated
that restyling costs per tray equivalent will decrease to $.035 per
tray equivalent. The average of Size 39 and 42 fruit sold over a 6-year
period is approximately 22 percent of the crop. Current restyling costs
are obtained by calculating 10 percent of the average of Size 39 and 42
fruit (22 percent of the total packout) and multiplying that number by
the estimated cost per tray equivalent.
Based on a total crop of 6 million tray equivalents (te) the cost
savings for repacking/restyling will be around $9,000. This amount is
obtained by subtracting $9,240 from $18,480 from the table below, which
is the difference between the restyling costs incurred when fruit must
be resized and restyling costs when fruit does not need to be resized.
Total Crop Sold (te)--6,000,000
Total Size 39 & 42 fruit (22% of total crop) (te)--1,320,000
Estimated number of Size 39 & 42 fruit restyled annually from bulk to
trays (10% of total 39/42's packed) (te)--132,000
Approximate cost to restyle Sizes 39 and 42 fruit without rechecking/
resizing for size variation difference (0.07 cents per te)--$9,240
Approximate cost to restyle Size 39 and 42 fruit that requires resize
for size variation difference (0.14 cents per te)--$18,480
This change reduces packing costs since handlers will no longer
need to resize fruit to the more restrictive \1/4\-inch tolerance in
the restyling (repacking) process. The packing process will also move
more rapidly since frequent resizing adjustments are no longer
necessary. Fewer resizing adjustments may also mean increased returns
to growers.
The Committee considered the alternative of not revising the rule,
but this was not considered viable because of the confusion currently
experienced because of differences in the size variation tolerance in
the different packs and the resulting increased packing costs. The
Committee reasoned that the only viable alternative was to create a
standard size variation tolerance regardless of pack.
This rule creates one size variation standard that will be applied
uniformly to all container types as well as consolidate the three
tables currently in the pack regulation of the order into one table.
Accordingly, these actions do 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 sectors.
USDA has not identified any relevant Federal rules that duplicate,
overlap, or conflict with this final rule. In fact, this action will
relax the current requirements under the U.S. Standards for Grade of
Kiwifruit (7 CFR 51.2335 through 51.2340) issued under the Agricultural
Marketing Act of 1946 (7 U.S.C. 1621 through 1627) with regard to
``fairly uniform in size.''
In addition, the Committee's meeting was widely publicized
throughout the kiwifruit industry and all interested persons were
invited to attend the meeting and participate in Committee
deliberations on all issues. Like all Committee meetings, the March 2,
2005, meeting, was a public meeting and all entities, both large and
small, were encouraged to express their views on these issues.
A proposed rule concerning this action was published in the Federal
Register on June 22, 2005 (70 FR 36060). Copies of the rule were mailed
or sent via facsimile to all Committee members and kiwifruit handlers.
Finally, the rule was made available through the Internet by USDA and
the Office of the Federal Register. A 20-day comment period ending July
12, 2005, was provided to allow interested persons to respond to the
proposal. No comments were received.
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.
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.
It is further found that good cause exists for not postponing the
effective date of this rule until 30 days after publication in the
Federal Register (5 U.S.C. 553) because this rule should be in place by
September 10, 2005, which is prior to the start of the new shipping
season. This rule relaxes requirements currently in effect. Further,
handlers are aware of this rule, which was recommended at a public
meeting. Also, a 20-day comment period was provided for in the proposed
rule and no comments were received.
List of Subjects in 7 CFR Part 920
Kiwifruit, Marketing agreements, Reporting and recordkeeping
requirements.
0
For the reasons set forth in the preamble, 7 CFR part 920 is amended 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. In Sec. 920.302, paragraph (a)(4) is revised to read as follows:
Sec. 920.302 Grade, size, pack, and container regulations.
(a) * * *
(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 shall be fairly uniform in size.
(ii) (A) Kiwifruit packed in any container shall be subject to the
size designation, maximum number of fruit per 8-pound sample, and the
size variation tolerance specified as follows:
[[Page 48842]]
Size Designation and Size Variation Chart
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Column 2
maximum
number of Column 3 size variation
Column 1 size designation fruit per 8- tolerance (diameter)
pound
sample
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18 or larger.................. 25 \1/2\-inch (12.7 mm).
20............................ 27 \1/2\-inch (12.7 mm).
23............................ 30 \1/2\-inch (12.7 mm).
25............................ 32 \1/2\-inch (12.7 mm).
27/28......................... 35 \1/2\-inch (12.7 mm).
30............................ 39 \1/2\-inch (12.7 mm).
33............................ 43 \3/8\-inch (9.5 mm).
36............................ 46 \3/8\-inch (9.5 mm).
39............................ 49 \3/8\-inch (9.5 mm).
42............................ 53 \3/8\-inch (9.5 mm).
45 or smaller................. 55 \1/4\-inch (6.4 mm).
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(B) The average weight of all sample units in a lot must weigh at
least 8 pounds, but no sample unit may be more than 4 ounces less than
8 pounds.
(C) Not more than 10 percent, by count, of the containers in any
lot and not more than 5 percent, by count, of kiwifruit in any
container, (except that for Sizes 42 and 45 kiwifruit, the tolerance,
by count, in any one container, may not be more than 25 percent) may
fail to meet the size variation requirements of this paragraph.
(iii) All volume fill containers of kiwifruit designated by weight
shall hold 19.8-pounds (9-kilograms) net weight of kiwifruit unless
such containers hold less than 15 pounds or more than 35 pounds net
weight of kiwifruit.
* * * * *
Dated: August 17, 2005.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. 05-16571 Filed 8-19-05; 8:45 am]
BILLING CODE 3410-02-P