[Federal Register: August 28, 2007 (Volume 72, Number 166)]
[Rules and Regulations]
[Page 49128-49134]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr28au07-2]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Parts 916 and 917
[Docket No. AMS-FV-07-0030; FV07-916/917-4 FIR]
Nectarines and Peaches Grown in California; Revision of Handling
Requirements for Fresh Nectarines and Peaches
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
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SUMMARY: The Department of Agriculture (USDA) is adopting, as a final
rule, without change, an interim final rule eliminating grade, size,
maturity, pack, container and inspection requirements for all
California nectarines and peaches except those packed in containers
labeled ``California Well Matured'' or ``CA WELL MAT.'' This rule also
continues in effect seasonal adjustments to the handling requirements
applicable to well matured fruit and the removal of certain handler
reporting requirements that are deemed no longer necessary. The
marketing orders regulate the handling of nectarines and peaches grown
in California and are administered locally by the Nectarine
Administrative and Peach Commodity Committees (committees). This rule
reduces handler costs while enabling handlers to continue to meet the
demands of their buyers.
EFFECTIVE DATE: September 27, 2007.
FOR FURTHER INFORMATION CONTACT: Jennifer Garcia, Marketing Specialist,
or Kurt J. Kimmel, Regional Manager, California Marketing Field Office,
Marketing Order Administration Branch, Fruit and Vegetable Programs,
AMS, USDA; Telephone: (559) 487-5901, Fax: (559) 487-5906; or E-mail:
Jennifer.Garcia3@usda.gov or Kurt.Kimmel@usda.gov.
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 rule is issued under Marketing Order
Nos. 916 and 917, both as amended (7 CFR parts 916 and 917), regulating
the handling of nectarines and peaches grown in California,
respectively, hereinafter referred to as the ``orders.'' The orders are
effective under the Agricultural Marketing Agreement Act of 1937, as
amended (7 U.S.C. 601-674), hereinafter referred to as the ``Act.''
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. 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 not later than 20 days after the date of
the entry of the ruling.
This final rule continues in effect the provisions of an interim
final rule action that: (1) Eliminated grade, size, maturity, pack,
container and inspection requirements for all California nectarines and
peaches except those packed in containers labeled ``California Well
Matured'' or ``CA WELL MAT;'' (2) made seasonal adjustments to the
handling requirements applicable to California Well Matured fruit; and
(3) removed certain handler reporting requirements that are deemed no
longer necessary.
These changes allow industry handlers to reduce costs and provide
them greater flexibility in meeting buyer preferences. Also,
adjustments are made in light of the newly implemented California State
marketing program.
Sections 916.52 and 917.41 of the orders provide authority for
handling regulations for fresh California nectarines and peaches. The
regulations may include grade, size, maturity, quality, pack, and
container requirements. The orders also provide that whenever such
requirements are in effect, the fruit subject to such regulation must
be inspected by the Federal or Federal-State Inspection Service (FSIS)
and certified as meeting the applicable requirements.
The nectarine order has been in effect since 1939, and the peach
program has been in effect since 1958. The orders have been used over
the years to establish a quality control program that includes minimum
grades, sizes, and maturity standards. That program has helped improve
the quality of product moving from the farm to market, and has helped
growers and handlers more effectively market their crops. Additionally,
the orders have been used to ensure that only satisfactory quality
nectarines and peaches reach the consumer. This has helped increase and
maintain market demand over the years.
Sections 916.53 and 917.42 authorize the modification, suspension,
or termination of regulations issued under 916.52 and 917.41,
respectively. Changes in regulations have been implemented to reflect
changes in
[[Page 49129]]
industry operating practices and to solve marketing problems as they
arise. The committees, which are responsible for local administration
of the orders, meet whenever needed, but at least annually, to discuss
the orders and the various regulations in effect and to determine if,
or what, changes may be necessary to reflect industry needs. As a
result, regulatory changes have been made numerous times over the years
to address industry changes and to improve program operations.
The industry has struggled to reduce costs in recent years. In its
efforts to reduce costs, the industry considered adopting audit-based
inspection programs in lieu of traditional inspection programs.
Ultimately, the industry determined that these programs would not
presently provide sufficient savings to the industry. More recently,
the industry considered replacing the existing Federal marketing orders
with programs under the State of California that would not require
Federal or Federal-State inspection of nectarines and peaches. In 2006,
at the request of the industry, the California Department of Food and
Agriculture promulgated a State program authorizing voluntary
inspections for the nectarine and peach industry.
Beginning with the 2007 season, under the State program, all fruit
must meet at least a modified U.S. No.1 grade and be ``mature'' as
defined in the United States Standards for Grades of Nectarines (7 CFR
51.3145 through 51.3160) and United States Standards for Grades of
Peaches (7 CFR 51.1210 through 51.1223) (hereinafter referred to as the
``Standards''). Inspection costs under the program are minimal because
inspection is not mandatory. The industry has also shifted its data
collection and promotional activities over to the State program.
The industry subsequently discussed removing all handling
regulations under the Federal orders. This would have also resulted in
the elimination of all inspection requirements and expenses under the
Federal orders. However, the industry believes that buyers value the
committees' ``CA WELL MAT'' mark as an indicator of high quality and
may be willing to pay a premium price for fruit marked as such. The
``CA WELL MAT'' certification mark is owned by the California Tree
Fruit Agreement, the management organization of the Peach Commodity
Committee (PCC), which also manages the Nectarine Administrative
Committee (NAC). Accordingly, the committees decided to maintain all
Federal marketing order handling requirements, including inspection and
certification requirements, for ``California well matured'' fruit. The
committees, thus, recommended revising the handling regulations to
cover only nectarines and peaches packed in containers marked ``CA WELL
MAT'' or ``California Well Matured.''
The term ``well matured'' is defined in the orders' rules and
regulations, and has been used for many years by the industry to
describe a level of maturity higher than the definition of ``mature''
in the Standards. The FSIS has been providing certification that these
products meet the definition. Containers of nectarines and peaches
bearing the certification mark must meet all of the requirements
entailed in the definition of ``well matured.'' Thus, nectarines and
peaches must continue to meet the grade and size requirements set forth
in the orders' rules and regulations.
The committees met on February 9, 2007, and unanimously recommended
that the handling requirements be revised for the 2007 season, which
began in April. The committees recommended a crop estimate of
19,000,000 containers of nectarines and 20,000,000 containers of
peaches at their May 1, 2007, meetings.
Container and Pack Requirements
Sections 916.52 and 917.41 of the orders authorize the
establishment of pack and container requirements for nectarines and
peaches, respectively. Such requirements appear in Sec. Sec. 916.115,
916.350, 917.150 and 917.442 of the orders' rules and regulations.
Prior to implementation of the interim final rule, Sec. Sec.
916.115 and 917.150 required that all containers of nectarines and
peaches, respectively, be stamped with an FSIS lot stamp number showing
that such fruit has been inspected. Since only nectarines and peaches
marked ``CA WELL MAT'' or ``California Well Matured'' are subject to
inspection requirements beginning in the 2007 season, Sec. Sec.
916.115 and 917.150 were revised to specify that lot stamping is only
required on containers so marked.
This rule also continues in effect a revision to paragraph (a)(3)
of Sec. Sec. 916.350 and 917.442 to remove references to ``U.S.
Mature'' and ``US MAT'' container markings. These references are no
longer needed since only fruit packed in containers marked ``CA WELL
MAT'' or ``California Well Matured'' are subject to handling
regulations under the orders this season.
Sections 916.350 and 917.442 also establish weight-count standards
for packed containers of nectarines and peaches, respectively. These
regulations define a maximum number of nectarines or peaches in a
sample when such fruit, which may be packed in tray-packed containers,
is converted to volume-filled containers. The regulations also specify
how the containers must be marked. In paragraph (a)(8) of Sec. 916.350
and (a)(9) of Sec. 917.442, weight marking requirements are
established for nectarines and peaches packed in volume-filled Euro
style containers.
According to the committees, some retailers have requested handlers
to supply volume-filled Euro containers with a net weight that is equal
to the weight of tray-packed Euro containers. By eliminating the net
weight requirement for volume-filled Euro containers, handlers are
allowed to increase or decrease the amount of fruit in the container to
match the net weight of fruit in a tray-packed Euro container, thus
giving them more flexibility when marketing their fruit.
Grade and Quality Requirements
Sections 916.52 and 917.41 of the orders authorize the
establishment of grade and quality requirements for nectarines and
peaches, respectively. Prior to the interim final rule, nectarines and
peaches were subject to a modified U.S. No. 1 grade requirement.
Handlers were also able to pack to ``CA Utility'' quality standards,
subject to container labeling requirements. The committees recommended
continued use of these grade and quality requirements.
However, they recommended that these requirements only be applied
to nectarines and peaches packed in containers marked ``CA WELL MAT''
or ``California Well Matured.'' This rule continues in effect revisions
to paragraph (a) of Sec. Sec. 916.356 and 917.459 to specify such
requirements only for containers of nectarines and peaches marked ``CA
WELL MAT'' or ``California Well Matured'' during the 2007 and
subsequent seasons.
These changes allow industry handlers to reduce inspection costs by
removing inspection and certification requirements on containers not
marked ``CA WELL MAT'' and provide them greater flexibility in meeting
buyer preferences.
This rule also continues in effect revisions of paragraph (a)(1) of
Sec. 916.356 to add an additional tolerance for Peento-type
nectarines. Peento-type nectarines, also known as donut[reg] nectarines
due to their flattened shape, are prone to growth cracks, which emanate
from the blossom end of the fruit. The committees believe that this is
a minor defect that does not affect the edibility of the fruit. Thus,
this action makes more Peento-type nectarines available to consumers
without
[[Page 49130]]
materially impacting the overall quality of the fruit.
Maturity Requirements
Sections 916.52 and 917.41 of the orders also authorize the
establishment of maturity requirements for nectarines and peaches,
respectively. The minimum maturity level currently specified for
nectarines and peaches is ``mature'' as defined in the Standards. The
regulations also define a higher level of maturity (``well-matured'')
that can be used at the option of handlers.
For most varieties, ``well-matured'' determinations for nectarines
and peaches are made using maturity guides (e.g., color chips) along
with other maturity tests as may be applied by inspectors. These
maturity guides are reviewed each year by the FSIS to determine whether
they need to be changed, based upon the most recent information
available on the individual characteristics of each nectarine and peach
variety.
These maturity guides appear in Table 1 in paragraphs (a)(1)(iv) of
Sec. Sec. 916.356 and 917.459, for nectarines and peaches,
respectively. Seasonal adjustments being made to the maturity guide are
described below.
Nectarines: Requirements for ``well-matured'' nectarines are
specified in Sec. 916.356 of the order's rules and regulations. This
rule revises Table 1 of paragraph (a)(1)(iv) of Sec. 916.356 to add
maturity guides for four varieties of nectarines. Specifically, the
FSIS recommended adding maturity guides for the Larry's Red, September
Bright, and WF 1 varieties to be regulated at the J maturity guide, and
for the Prima Diamond VII variety to be regulated at the L maturity
guide.
Peaches: Requirements for ``well-matured'' peaches are specified in
Sec. 917.459 of the order's rules and regulations. This rule revises
Table 1 of paragraph (a)(1)(iv) of Sec. 917.459 to add maturity guides
for 11 peach varieties. Specifically, the FSIS recommended adding
maturity guides for the Super Chief and Sweet Crest varieties to be
regulated at the H maturity guide; the Junelicious variety to be
regulated at the I maturity guide; the Burpeachfourteen (Spring
Flame[reg] 20), Henry III, Sharise, Sierra Rich, Sweet Blaze and Sweet
Kay varieties to be regulated at the J maturity guide; and the Bright
Princess and Summer Fling varieties to be regulated at the L maturity
guide.
The committees recommended these maturity guide requirements based
on the FSIS's continuing review of individual maturity characteristics
and identification of the appropriate maturity guide corresponding to
the ``well-matured'' level of maturity for nectarine and peach
varieties in production.
Size Requirements
Both orders provide authority (in Sec. Sec. 916.52 and 917.41) to
establish size requirements. Size regulations encourage producers to
leave fruit on the tree longer, which improves both size and maturity
of the fruit. Acceptable fruit size provides greater consumer
satisfaction and promotes repeat purchases, thereby increasing returns
to producers and handlers. In addition, increased fruit size results in
increased numbers of packed containers of nectarines and peaches per
acre, which is also a benefit to producers and handlers.
Several years ago the committees recommended revisions to allow
handlers of late season nectarine and peach varieties to pack smaller
sized fruit as long as the fruit was ``well matured.'' This rule
continues in effect revisions to the size regulations in paragraphs
(a)(6)(i), (a)(6)(ii), (a)(9)(i), and (a)(9)(ii) of Sec. 916.356 and
paragraphs (a)(6)(i) and (a)(6)(ii) to remove size options since only
containers marked ``CA WELL MAT'' or ``California Well Matured'' are
subject to the size regulations under the orders.
Varieties recommended for specific size regulations have been
reviewed and such recommendations are based on the specific
characteristics of each variety. The committees conduct studies each
season on the range of sizes attained by the regulated varieties and
those varieties with the potential to become regulated, and determine
whether revisions to the size requirements are appropriate.
Nectarines: Section 916.356 of the order's rules and regulations
specifies minimum size requirements for fresh nectarines in paragraphs
(a)(2) through (a)(9). This rule continues in effect revisions to
paragraphs (a)(3), (a)(4), and (a)(6) of Sec. 916.356 to establish
variety-specific minimum size requirements for 14 varieties of
nectarines that were produced in commercially significant quantities of
more than 10,000 containers for the first time during the 2006 season.
For example, one of the varieties recommended for addition to the
variety-specific minimum size requirements is the Burnectfive (Spring
Flare[reg] 21) variety of nectarines, recommended for regulation at a
minimum size 96. Studies of the size ranges attained by the Burnectfive
(Spring Flare[reg] 21) variety revealed that 100 percent of the
containers met the minimum size of 96 during the 2005 and 2006 seasons.
Sizes ranged from size 50 to size 96, with 5.8 percent of the fruit in
the 50 sizes, 15.7 percent of the packages in the 60 sizes, 28.6
percent in the 70 sizes, 34.1 percent in the 80 sizes, and 16.8 percent
in the 90 sizes.
A review of other varieties with the same harvesting period
indicated that the Burnectfive (Spring Flare[reg] 21) variety was also
comparable to those varieties in its size ranges for that time period.
Discussions with handlers known to handle the variety confirmed this
information regarding minimum size and harvesting period. Thus, the
recommendation to place the Burnectfive (Spring Flare[reg] 21) variety
in the variety-specific minimum size regulation at a minimum size 96
was appropriate. This recommendation results from size studies
conducted by the committees over a two-year period.
Historical data such as this provides the committee with the
information necessary to recommend the appropriate sizes at which to
regulate various nectarine varieties. In addition, producers and
handlers of the varieties affected are personally invited to comment
when such size recommendations are deliberated. Producer and handler
comments are also considered at both NAC and subcommittee meetings when
the staff receives such comments, either in writing or verbally.
For reasons similar to those discussed in the preceding paragraph,
paragraph (a)(3) of Sec. 916.356 is revised to include the Burnectfive
(Spring Flare[reg] 21) variety; paragraph (a)(4) of Sec. 916.356 was
revised to include the Burnecttwelve (Sweet Flare[reg] 21), Early
Pearl, and Rose Bright varieties; and paragraph (a)(6) of Sec. 916.356
was revised to include the August Bright, Burnectseventeen (Summer
Flare[reg] 32), Candy Pearl, Grand Candy, Honey Diva, Larry's Red,
Prima Diamond VII, Spring PearlTM, Sugarine, and Zephyr
nectarine varieties.
Peaches: Section 917.459 of the order's rules and regulations
specifies minimum size requirements for fresh peaches in paragraphs
(a)(2) through (a)(6), and paragraphs (b) and (c). This rule continues
to revise paragraphs (a)(2), (a)(3), (a)(4), (a)(5), and (a)(6) of
Sec. 917.459 to establish variety-specific minimum size requirements
for 11 peach varieties that were produced in commercially significant
quantities of more than 10,000 containers for the first time during the
2006 season. This rule also continues to remove the variety-specific
minimum size 16 requirements for seven varieties of peaches whose
[[Page 49131]]
shipments fell below 5,000 containers during the 2006 season.
For example, one of the varieties recommended for addition to the
variety-specific minimum size requirements was the May Snow variety of
peaches, which was recommended for regulation at a minimum size 88.
Studies conducted by the committees on the size ranges attained by the
May Snow variety revealed that 97.8 percent of the containers met the
minimum size of 88 during the 2005 and 2006 seasons. The sizes ranged
from size 40 to size 88, with 11.6 percent of the containers meeting
the size 40, 19.2 percent meeting the size 50, 45.7 percent meeting the
size 60, 15.1 percent meeting the size 70, 3.4 percent meeting the size
80, 2.3 percent meeting the size 84, and 0.5 percent meeting the size
88 in the 2006 season.
A review of other varieties with the same harvesting period
indicated that the May Snow variety was also comparable to those
varieties in its size ranges for that time period. Discussions between
the committees and handlers known to pack the variety confirmed this
information regarding minimum size and the harvesting period. Thus, the
recommendation to place the May Snow variety in the variety-specific
minimum size regulation at a minimum size 88 is appropriate.
Historical data such as this provides the committee with the
information necessary to recommend the appropriate sizes at which to
regulate various peach varieties. In addition, producers and handlers
of the varieties affected are personally invited to comment when such
size recommendations are deliberated. Producer and handler comments are
also considered at committee meetings when the staff receives such
comments, either in writing or verbally.
For reasons similar to those discussed in the preceding paragraph,
paragraph (a)(2) of Sec. 917.459 was revised to include the Snow Angel
peach variety; paragraph (a)(3) of Sec. 917.459 was revised to include
the May Snow peach variety; paragraph (a)(4) of Sec. 917.459 was
revised to include the May Saturn (Early Saturn) peach variety;
paragraph (a)(5) of Sec. 917.459 was revised to include the Candy Red,
Raspberry, and Sugar Jewel peach varieties; and paragraph (a)(6) of
Sec. 917.459 was revised to include the Burpeachfifteen (Summer
Flame[reg] 34), Burpeachsixteen, Burpeachtwenty (Summer Flame[reg]),
Galaxy, and Snow Magic peach varieties.
Section (a)(4) is reserved for any varieties which will be
regulated at a size 84. The May Saturn (Early Saturn) variety, as noted
above, is regulated at size 84 under (a)(4).
This rule revises paragraph (a)(5) of Sec. 917.459 to remove the
May Sun and Snow Prince peach varieties and paragraph (a)(6) of Sec.
917.459 to remove the 24-SB, Crimson Queen, Jupiter, Red Giant, and
Spring Gem peach varieties from the variety-specific minimum size
requirements because less than 5,000 containers of each of these
varieties was produced during the 2006 season.
Peach varieties removed from the peach variety-specific minimum
size requirements are subject to the non-listed variety size
requirements specified in paragraphs (b) and (c) of Sec. 917.459.
The committees recommended these changes in the minimum size
requirements based on a continuing review of the sizing and maturity
relationships for these nectarine and peach varieties, and the consumer
acceptance levels for various fruit sizes. This rule is designed to
establish minimum size requirements for fresh nectarines and peaches
consistent with expected crop and market conditions.
Reporting Requirements
Sections 916.60 and 917.50 of the orders authorize the
establishment of reporting requirements for nectarines and peaches,
respectively. Prior to the interim rule, under 19 sections 916.160,
917.178, and 917.179, handlers are required to file certain reports
pertaining to daily packouts, annual shipments, and shipment
destinations. The collection and dissemination of statistical
information has been a valuable component of the programs, as it
provides growers and handlers with information which enhances their
decision-making ability.
However, as a State marketing program has recently been implemented
for the California peach and nectarine industries, which includes the
collection and dissemination of statistical information, there is no
longer a need to require these handler reports under the orders.
Therefore, at their February 9, 2007, meetings, the committees
recommended removing current handler reporting requirements, beginning
with the 2007 season. The committees have implemented a memorandum of
understanding to share information with the new State marketing order,
so information collected by the State program can be utilized by the
committees.
This rule continues in effect revisions removing reporting
requirements in Sec. 916.160 for nectarines and Sec. Sec. 917.178 and
917.179 for peaches. This action reduces handler costs under the
orders.
This rule reflects the need to revise the handling and reporting
requirements for California nectarines and peaches. This rule is
intended primarily to reduce costs and should therefore have a
beneficial impact on producers, handlers, and consumers of fresh
California nectarines and peaches. This rule is also intended to
maintain the perceived value of the ``California well matured''
certification mark by maintaining current grade, size, quality, pack,
container and inspection requirements on fruit packed and labeled as
``California Well Matured'' or ``CA WELL MAT.''
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 rules issued thereunder, are unique in that
they are brought about through group action of essentially small
entities acting on their own behalf.
Industry Information
There are approximately 175 California nectarine and peach handlers
subject to regulation under the orders covering nectarines and peaches
grown in California, and about 676 producers of these fruits in
California. Small agricultural service firms, which include handlers,
are defined by the Small Business Administration (SBA) (13 CFR 121.201)
as those whose annual receipts are less than $6,500,000. Small
agricultural producers are defined by the SBA as those having annual
receipts of less than $750,000. A majority of these handlers and
producers may be classified as small entities.
The committees' staff has estimated that there are fewer than 26
handlers in the industry who would not be considered small entities.
For the 2006 season, the committees' staff estimated that the average
handler price received was $9.00 per container or container equivalent
of nectarines or peaches. A handler would have to ship at least 722,223
containers to have annual receipts of $6,500,000. Given data on
shipments maintained by the committees' staff and the average handler
price received during the 2006 season, the committees' staff estimates
[[Page 49132]]
that small handlers represent approximately 85 percent of all the
handlers within the industry.
The committees' staff has also estimated that fewer than 68
producers in the industry would not be considered small entities. For
the 2006 season, the committees estimated the average producer price
received was $4.50 per container or container equivalent for nectarines
and peaches. A producer would have to produce at least 166,667
containers of nectarines and peaches to have annual receipts of
$750,000. Given data maintained by the committees' staff and the
average producer price received during the 2006 season, the committees'
staff estimates that small producers represent more than 90 percent of
the producers within the industry.
With an average producer price of $4.50 per container or container
equivalent, and a combined packout of nectarines and peaches of
36,388,996 containers, the value of the 2006 packout is estimated to be
$163,750,482. Dividing this total estimated grower revenue figure by
the estimated number of producers (676) yields an estimate of average
revenue per producer of about $242,234 from the sales of peaches and
nectarines.
Regulatory Revisions
Under authority provided in Sec. Sec. 916.52 and 917.41 of the
orders, grade, size, maturity, pack, and container marking requirements
are established for fresh shipments of California nectarines and
peaches, respectively. Such requirements are in effect on a continuing
basis. The committees met on February 9, 2007, and unanimously
recommended that these handling requirements be revised for the 2007
season. This final rule continues in effect the provisions of an
interim final rule action that: (1) Eliminated grade, size, maturity,
pack, container and inspection requirements for all California
nectarines and peaches except those packed in containers labeled
``California Well Matured'' or ``CA WELL MAT''; (2) makes seasonal
adjustments to the handling requirements applicable to California Well
Matured fruit; and (3) removes certain handler reporting requirements
that are deemed no longer necessary.
Container and Pack Requirements--Discussions and Alternatives
Sections 916.350 and 917.442 establish container and pack
requirements. The committees discussed removing all handling
regulations under the Federal orders, including inspection
requirements. However, the industry believes that buyers value the
committees' ``CA WELL MAT'' mark as an indicator of high quality and
may be willing to pay a premium price for fruit marked as such.
Accordingly, they decided to maintain current grade, quality, maturity,
size container, pack and inspection requirements for ``well matured''
fruit. The committees, thus, recommended revising the handling
regulations to cover only nectarines and peaches packed in containers
marked ``CA WELL MAT'' or ``California Well Matured.''
Lot Stamping Requirements--Discussions and Alternatives
Sections 916.115 and 917.150 establish lot stamping requirements.
This rule continues in effect lot stamping requirements to require such
markings only on containers labeled ``CA WELL MAT'' or ``California
Well Matured.'' An alternative would be to leave the existing lot
stamping requirements unchanged, but the requirements would not be
consistent with the other recommended changes and would result in
unnecessary expenses for industry handlers. Based on this, the
committees recommended revising lot stamping requirements to require
such markings only on containers labeled ``CA WELL MAT'' or
``California Well Matured.''
Weight Marking Requirements--Discussions and Alternatives
Sections 916.350 and 917.442 also establish weight marking
requirements for nectarines and peaches packed in Euro type volume-
filled containers. These require each five down Euro container of
loose-filled nectarines or peaches to be marked with the words ``29
pounds net weight.''
In the past, handlers' sales to their retail customers have been
based on set net weights for most pack styles. With the changing
marketing environment, some retailers want volume-filled pack styles
that have the same net weight as tray pack styles, especially for the
Euro type containers.
Handlers either respond to the requests of the retailers or risk
losing business from those retailers. The committees agreed that weight
markings are no longer necessary; and, in turn, at their February 9,
2007, meetings recommended eliminating the Euro type container weight
marking requirement.
Without the weight marking requirements, nectarines and peaches
packed in Euro style volume-filled containers can be packed to the
buyers' preferences. The committees believe that the elimination of
marking requirements will satisfy the stated needs of retailers and
will open additional market opportunities for the industry.
Grade and Quality Requirements--Discussions and Alternatives
Sections 916.356 and 917.459 establish minimum grade and quality
requirements. The NAC and PCC previously discussed removing all
handling regulations under the orders in favor of regulations under the
newly-promulgated State marketing order. However, the industry still
wanted to retain quality standards for fruit marketed as ``CA WELL
MAT,'' a term which has value to buyers and the industry. One
alternative the committees discussed was to allow handlers to use the
mark under a licensing agreement with CTFA. Taking into account
enforcement concerns, this approach was not considered feasible.
At their February 9, 2007, meetings, the committees recommended
revising the grade and quality requirements to apply only to nectarines
and peaches packed in containers marked ``CA WELL MAT'' or ``California
Well Matured'' beginning with the 2007 season. This action ensures that
fruit packed in containers marked ``CA WELL MAT'' or ``California Well
Matured'' is inspected and meets applicable grade and quality
requirements. For this reason, the committees unanimously recommended
the revisions in this final rule and believe that they will help
accomplish the goals of the industry.
Minimum Maturity and Size Requirements--Discussions and Alternatives
Sections 916.356 and 917.459 establish minimum fruit maturity
levels. This rule continues in effect adjustments to the maturity
requirements for several varieties of nectarines and peaches. Maturity
requirements are based on measurements suggested by maturity guides
(e.g., color chips), as reviewed and recommended by the FSIS annually
to determine the appropriate guide for each nectarine and peach
variety. These annual adjustments reflect refinements in measurements
of the maturity characteristics of nectarines and peaches as observed
during previous seasons' inspections. Adjustments in the guides
utilized ensure acceptable fruit maturity and increased consumer
satisfaction while benefiting nectarine and peach producers and
handlers.
Sections 916.356 and 917.459 of the orders' rules and regulations
also specify minimum sizes for various varieties of nectarines and
peaches. This rule continues in effect adjustments to
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the minimum sizes authorized for certain varieties of each commodity
for the 2007 season. Minimum size regulations are put in place to
encourage producers to leave fruit on the trees for a longer period of
time, increasing both maturity and fruit size. Increased fruit size
increases the number of packed containers per acre, and coupled with
heightened maturity levels, also provides greater consumer
satisfaction, which in turn fosters repeat purchases that benefit
producers and handlers alike.
Annual adjustments to minimum sizes of nectarines and peaches, such
as these, are recommended by NAC and PCC based upon historical data,
producer and handler information regarding sizes attained by different
varieties, and trends in consumer purchases.
An alternative to such action would include not establishing
minimum size regulations for these new varieties. Such an action,
however, would be a significant departure from the committees' past
practices and represent a significant change in the regulations as they
currently exist. For these reasons, this alternative was not
recommended.
Sections 916.356 and 917.459 of the orders' rules and regulations
also specify size requirements for handlers of late season nectarine
and peach varieties wishing to pack smaller sized fruit as long as the
fruit was ``well matured.'' Since only containers marked ``CA WELL
MAT'' or ``California Well Matured'' are subject to minimum size
requirements, this rule also continues in effect revisions to the size
regulations which remove these obsolete size options.
Reporting Requirements--Discussions and Alternatives
Sections 916.160 and 917.178 establish reporting requirements for
nectarine and peach handlers, respectively. Similar reporting
requirements have been established under the newly-implemented
California State marketing program. Accordingly, collection of this
information under the Federal orders is no longer necessary. The
committees have implemented a memorandum of understanding to share
information with the new State marketing order, so information
collected by the State program can be utilized by the committees. An
alternative would be to maintain the reporting requirements, but this
would result in an unnecessary reporting burden. For this reason, the
removal of reporting requirements was unanimously recommended by both
committees.
The committees make recommendations regarding the revisions in
handling and reporting requirements after considering all available
information, including comments received by committee staff. At the
meetings, the impact of and alternatives to these recommendations are
deliberated. The committees consist of individual producers and
handlers with many years of experience in the industry who are familiar
with industry practices and trends. All committee meetings are open to
the public and comments are widely solicited. In addition, minutes of
all meetings are distributed to committee members and others who have
requested them, and are also available on the committees' Web site,
thereby increasing the availability of this critical information within
the industry.
Regarding the impact of this action on the affected entities, each
of the revisions is expected to generate financial benefits for
producers and handlers through reduced costs and increased fruit sales.
Both large and small entities are expected to benefit from the changes,
and the costs of compliance are not expected to be significantly
different between large and small entities.
This rule continues in effect revisions reducing reporting and
recordkeeping requirements on both small and large nectarine and peach
handlers regulated under the orders. 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.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
Chapter 35), the information collection requirements that were removed
by the interim final rule were approved by the Office of Management and
Budget (OMB), under OMB No. 0581-0189, Generic OMB Fruit Crops. Removal
of the reporting requirements under Parts 916 and 917 is expected to
reduce the reporting burden on small or large peach and nectarine
handlers by 370 hours, and should further reduce industry expenses.
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.
In addition, USDA has not identified any relevant Federal rules
that duplicate, overlap, or conflict with this rule.
Further, the committees' meetings are widely publicized throughout
the nectarine and peach industry and all interested parties are
encouraged to attend and participate in committee deliberations on all
issues. These meetings are held annually in the fall, winter, and
spring. During the February 9, 2007, meetings, all entities, large and
small, were encouraged to express views on these issues.
An interim final rule concerning this action was published in the
Federal Register on April 16, 2007 (72 FR 18847) . Copies of the rule
were posted on the committees' Web site. In addition, the rule was made
available through the Internet by USDA and the Office of the Federal
Register. That rule provided a 60-day comment period which ended June
15, 2007. Two comments were received during the comment period in
response to the rule.
The first commenter, representing the committees, agrees with a
majority of the changes that were outlined in the interim final rule.
The commenter stated that there was one discrepancy in regards to the
reporting requirements. The commenter contends that the committees'
intent was to have reporting requirements suspended, not removed, in
case the committees recommend reinstating the Federal orders' reporting
requirements in the future. The commenter contends that if the
reporting requirements are removed, the current OMB approval on the
committees' reporting forms will be eliminated.
The suspension of reporting requirements without a reactivation
date is essentially equivalent to the removal of reporting
requirements. The reinstatement process would not be shortened by
retaining the regulations. USDA will work to ensure a timely
reinstatement of the reporting requirements should the committees
recommend using them in the future. Accordingly, no changes have been
made to the rule based on this comment.
The second commenter contends that lowering industry quality
standards will adversely affect the public in a number of ways.
However, previously mentioned, beginning with the 2007 season,
under the new State program, all fruit must meet at least a modified
U.S. No. 1 grade and be ``mature'' as defined in the Standards for
nectarines and peaches. Under the Federal program, all marketing order
handling requirements, including inspection and certification
requirements, for ``California well matured'' fruit are maintained. The
quality standards are not being lowered; rather they are being revised
to give
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handlers more cost-saving options. Accordingly, no changes have been
made to the rule based on this comment.
A small business guide on complying with fruit, vegetable, and
specialty crop marketing agreements and orders may be viewed at the
following Web site: 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 matters presented, the
information and recommendations submitted by the committees, and other
information, it is found that finalizing the interim final rule,
without change, as published in the Federal Register (72 FR 18847,
April 16, 2007) will tend to effectuate the declared policy of the Act.
With regard to revision to the rules and regulations under the order
and concerning those provisions that were removed or terminated, it is
found that those provisions no longer tend to effectuate the declared
policy of the Act.
List of Subjects
7 CFR Part 916
Marketing agreements, Nectarines, Reporting and recordkeeping
requirements.
7 CFR Part 917
Marketing agreements, Peaches, Pears, Reporting and recordkeeping
requirements.
PARTS 916 and 917--[AMENDED]
0
Accordingly, the interim final rule amending 7 CFR parts 916 and 917
which was published at 72 FR 18847 on April 16, 2007, is adopted as a
final rule without change.
Dated: August 21, 2007.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. 07-4161 Filed 8-27-07; 8:45 am]
BILLING CODE 3410-02-M