Marketing Order Regulating the Handling of Spearmint Oil Produced in the Far West; Revision of the Salable Quantity and Allotment Percentage for Class 1 (Scotch) and Class 3 (Native) Spearmint Oil for the 2005-2006 Marketing Year, 55713-55717 [05-19084]
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Federal Register / Vol. 70, No. 184 / Friday, September 23, 2005 / Rules and Regulations
Based on Committee data, there are 8
producers and 8 handlers in the
production area subject to regulation
under the order. Small agricultural
producers are defined by the Small
Business Administration (13 CFR
121.201) as those having annual receipts
of less than $750,000, and small
agricultural service firms are defined as
those whose annual receipts are less
than $6,000,000.
Based on the total number of Colorado
Area No. 3 potato producers (8), 2003
fresh potato production of 1,041,958
hundredweight (Committee records),
and the average 2003 producer price of
$5.05 per hundredweight as reported by
National Agricultural Statistics Service
(NASS), average annual revenue per
producer from the sale of potatoes can
be estimated at approximately $657,736.
In addition, based on Committee records
and an estimated average 2003 f.o.b.
price of $7.15 per hundredweight ($5.05
per hundredweight NASS producer
price plus Committee estimated packing
and handling costs of $2.10 per
hundredweight), all of the Colorado
Area No. 3 potato handlers ship under
$6,000,000 worth of potatoes. In view of
the foregoing, it can be concluded that
the majority of the Colorado Area No. 3
potato producers and handlers may be
classified as small entities.
This rule continues in effect the
action that decreased the assessment
rate established for the Committee and
collected from handlers for the 2005–
2006 and subsequent fiscal periods from
$0.03 to $0.02 per hundredweight of
potatoes. The assessment rate of $0.02 is
$0.01 less than the 2004–2005 rate. The
quantity of assessable potatoes for the
2005–2006 fiscal period is estimated at
585,475 hundredweight. Income derived
from handler assessments, along with
interest income and funds from the
Committee’s authorized reserve, will be
adequate to cover budgeted expenses.
Funds in the reserve ($42,701 as of July
1, 2005) will be kept within the
maximum of approximately two fiscal
periods’ operational expenses as
authorized by the order (§ 948.78).
The major expenditures
recommended by the Committee for the
2005–2006 fiscal period include $8,610
for salary, $3,000 for office rent, $1,750
for office expenses, and $1,000 for
utilities. These budgeted expenses are
the same as those approved for the
2004–2005 fiscal period.
Due to increased potato yields and a
reduction in expenses, the Committee’s
reserve has increased more than
anticipated. Therefore, the Committee
recommended a decreased assessment
rate to enable an increased draw on the
reserve, thus maintaining the level of
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14:48 Sep 22, 2005
Jkt 205001
the reserve within program limits of
approximately two fiscal periods’
operational expenses.
The Committee discussed alternatives
to this rule, including alternative
expenditure levels, but determined that
the recommended expenses were
reasonable and necessary to adequately
cover program operations. Lower
assessment rates were considered, but
not recommended because they would
not generate the income necessary to
administer the program.
A review of historical information and
preliminary information pertaining to
the current crop year indicates that the
producer price for the 2005–2006 season
could range between $5.05 and $7.75
per hundredweight. Therefore, the
estimated assessment revenue for the
2005–2006 fiscal period as a percentage
of total producer revenue could range
between 0.40 and 0.26 percent.
This action continues in effect the
action that decreased the assessment
obligation imposed on handlers.
Assessments are applied uniformly on
all handlers, and some of the costs may
be passed on to producers. However,
decreasing the assessment rate reduces
the burden on handlers, and may reduce
the burden on producers. In addition,
the Committee’s meeting was widely
publicized throughout the Colorado
potato industry and all interested
persons were invited to attend and
participate in the Committee’s
deliberations on all issues. Like all
Committee meetings, the May 12, 2005,
meeting was a public meeting and all
entities, both large and small, were able
to express views on these issues.
This action imposes no additional
reporting or recordkeeping requirements
on either small or large Colorado potato
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.
USDA has not identified any relevant
Federal rules that duplicate, overlap, or
conflict with this rule.
An interim final rule concerning this
action was published in the Federal
Register on June 27, 2005 (70 FR 36814).
Copies of that rule were also mailed or
sent via facsimile to all Area No. 3
Colorado potato handlers. Finally, the
interim final rule was made available
through the Internet by USDA and the
Office of the Federal Register. A 60-day
comment period was provided for
interested persons to respond to the
interim final rule. The comment period
ended August 26, 2005, and no
comments were received.
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55713
A small business guide on complying
with fruit, vegetable, and specialty crop
marketing agreements and orders may
be viewed at: https://www.ama.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
material 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.
List of Subjects in 7 CFR Part 948
Marketing agreements, Potatoes,
Reporting and recordkeeping
requirements.
PART 948—IRISH POTATOES GROWN
IN COLORADO
Accordingly, the interim final rule
amending 7 CFR part 948 which was
published at 70 FR 36814 on June 27,
2005, is adopted as a final rule without
change.
I
Dated: September 19, 2005.
Lloyd C. Day,
Administrator, Agricultural Marketing
Service.
[FR Doc. 05–18990 Filed 9–22–05; 8:45 am]
BILLING CODE 3410–02–P
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 985
[Docket No. FV05–985–2 IFR]
Marketing Order Regulating the
Handling of Spearmint Oil Produced in
the Far West; Revision of the Salable
Quantity and Allotment Percentage for
Class 1 (Scotch) and Class 3 (Native)
Spearmint Oil for the 2005–2006
Marketing Year
Agricultural Marketing Service,
USDA.
ACTION: Interim final rule with request
for comments.
AGENCY:
SUMMARY: This rule revises the quantity
of Class 1 (Scotch) and Class 3 (Native)
spearmint oil that handlers may
purchase from, or handle for, producers
during the 2005–2006 marketing year.
This rule increases the Scotch spearmint
oil salable quantity from 677,409
pounds to 1,062,898 pounds, and the
allotment percentage from 35 percent to
55 percent. In addition, this rule
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Federal Register / Vol. 70, No. 184 / Friday, September 23, 2005 / Rules and Regulations
increases the Native spearmint oil
salable quantity from 867,958 pounds to
1,019,600 pounds, and the allotment
percentage from 40 percent to 47
percent. The order regulates the
handling of spearmint oil produced in
the Far West and is administered locally
by the Spearmint Oil Administrative
Committee (Committee). The Committee
recommended this rule for the purpose
of avoiding extreme fluctuations in
supplies and prices and to help
maintain stability in the Far West
spearmint oil market.
DATES: Effective June 1, 2005, through
May 31, 2006; comments received by
November 22, 2005 will be considered
prior to issuance of a final rule.
ADDRESSES: Interested persons are
invited to submit written comments
concerning this rule. Comments must be
sent to the Docket Clerk, Marketing
Order Administration Branch, Fruit and
Vegetable Programs, AMS, USDA, 1400
Independence Avenue SW., STOP 0237,
Washington, DC 20250–0237; Fax: (202)
720–8938; E-mail:
moab.docketclerk@usda.gov; or Internet:
https://www.regulations.gov. All
comments should reference the docket
number and the date and page number
of this issue of the Federal Register and
will be made available for public
inspection in the Office of the Docket
Clerk during regular business hours, or
can be viewed at: https://
www.ams.usda.gov/fv/moab.html.
FOR FURTHER INFORMATION CONTACT:
Susan M. Hiller, Northwest Marketing
Field Office, Marketing Order
Administration Branch, Fruit and
Vegetable Programs, AMS, USDA;
Telephone: (503) 326–2724, Fax: (503)
326–7440; 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 rule
is issued under Marketing Order No.
985 (7 CFR part 985), as amended,
regulating the handling of spearmint oil
produced in the Far West (Washington,
Idaho, Oregon, and designated parts of
Nevada and Utah), hereinafter referred
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14:48 Sep 22, 2005
Jkt 205001
to as the ‘‘order.’’ The order is effective
under the Agricultural Marketing
Agreement Act of 1937, as amended (7
U.S.C. 601–674), hereinafter referred to
as the ‘‘Act.’’
The Department of Agriculture
(USDA) is issuing this rule in
conformance with Executive Order
12866.
This rule has been reviewed under
Executive Order 12988, Civil Justice
Reform. This rule is not intended to
have retroactive effect. This rule will
not preempt any State or local laws,
regulations, or policies, unless they
present an irreconcilable conflict with
this rule.
The Act provides that administrative
proceedings must be exhausted before
parties may file suit in court. Under
section 608c(15)(A) of the Act, any
handler subject to an order may file
with USDA a petition stating that the
order, any provision of the order, or any
obligation imposed in connection with
the order is not in accordance with law
and request a modification of the order
or to be exempted therefrom. 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.
The initial salable quantity and
allotment percentages for Scotch and
Native spearmint oil for the 2005–2006
marketing year were recommended by
the Committee at its October 6, 2004,
meeting. The Committee recommended
salable quantities of 677,409 pounds
and 867,958 pounds, and allotment
percentages of 35 percent and 40
percent, respectively, for Scotch and
Native spearmint oil. A proposed rule
was published in the Federal Register
on January 12, 2005 (70 FR 2027).
Comments on the proposed rule were
solicited from interested persons until
February 11, 2005. No comments were
received. Subsequently, a final rule
establishing the salable quantities and
allotment percentages for Scotch and
Native spearmint oil for the 2005–2006
marketing year was published in the
Federal Register on March 24, 2005 (70
FR 14969).
This rule revises the quantity of
Scotch and Native spearmint oil that
handlers may purchase from, or handle
for, producers during the 2005–2006
marketing year, which ends on May 31,
2006. Pursuant to authority contained in
§§ 985.50, 985.51, and 985.52 of the
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order, the Committee met on August 24,
2005, and in two separate motions,
recommended that the 2005–2006
Scotch and Native spearmint oil
allotment percentages be increased by
20 percent and 7 percent, respectively.
With seven of the eight members
present at the meeting, each of the
recommendations passed with six
members in favor and one member
opposed. In both cases, the members
opposing the recommendations favored
larger increases.
Thus, taking into consideration the
following discussion on adjustments to
the Scotch and Native spearmint oil
salable quantities, this rule increases the
2005–2006 marketing year salable
quantities and allotment percentages for
Scotch and Native spearmint oil to
1,062,898 pounds and 55 percent, and
1,019,600 pounds and 47 percent,
respectively.
The salable quantity is the total
quantity of each class of oil that
handlers may purchase from, or handle
for, producers during the marketing
year. The total salable quantity is
divided by the total industry allotment
base to determine an allotment
percentage. Each producer is allotted a
share of the salable quantity by applying
the allotment percentage to the
producer’s individual allotment base for
the applicable class of spearmint oil.
The original total industry allotment
base for Scotch spearmint oil for the
2005–2006 marketing year was
established at 1,935,455 pounds and
was revised at the beginning of the
2005–2006 marketing year to 1,932,542
pounds to reflect a 2004–2005
marketing year loss of 2,913 pounds of
base due to non-production of some
producers’ total annual allotments.
When the revised total allotment base of
1,932,455 pounds is applied to the
originally established allotment
percentage of 35 percent, the 2005–2006
marketing year salable quantity of
677,409 is effectively modified to
676,390 pounds.
The same situation applies to Native
spearmint oil where the original total
industry allotment base for the 2005–
2006 marketing year was established at
2,169,894 pounds and was revised at the
beginning of the 2005–2006 marketing
year to 2,169,362 pounds to reflect a
2004–2005 marketing year loss of 532
pounds of base due to non-production
of some producers’ total annual
allotments. When the revised total
allotment base of 2,169,362 pounds is
applied to the originally established
allotment percentage of 40 percent, the
2005–2006 marketing year salable
quantity of 867,958 is effectively
modified to 867,745 pounds.
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Federal Register / Vol. 70, No. 184 / Friday, September 23, 2005 / Rules and Regulations
By increasing the salable quantity and
allotment percentage, this rule makes an
additional amount of Scotch and Native
spearmint oil available by releasing oil
from the reserve pool. When applied to
each individual producer, the allotment
percentage increases allow each
producer to take up to an amount equal
to their allotment base from their
reserve for each respective class of oil.
Before November 1, 2005, a producer
may also transfer excess oil to another
producer to enable that producer to fill
a deficiency in that producer’s annual
allotment for that class of oil.
The following tables summarize the
Committee recommendations:
Scotch Spearmint Oil Recommendation
(A) Estimated 2005–2006 Allotment
Base—1,935,455 pounds. This is the
estimate on which the original 2005–
2006 Scotch spearmint oil salable
quantity and allotment percentage was
based.
(B) Revised 2005–2006 Allotment
Base—1,932,542 pounds. This is 2,913
pounds less than the estimated
allotment base of 1,935,455 pounds.
This is less because some producers
failed to produce all of their 2004–2005
allotment.
(C) Initial 2005–2006 Allotment
Percentage—35 percent. This was
recommended by the Committee on
October 6, 2004.
(D) Initial 2005–2006 Salable
Quantity—677,409. This figure is 35
percent of 1,935,455 pounds.
(E) Initial Adjustment to the 2005–
2006 Salable Quantity—676,390
pounds. This figure reflects the salable
quantity initially available after the
beginning of the 2005–2006 marketing
year due to the 2,913 pound reduction
in the industry allotment base to
1,932,542 pounds.
(F) Increase in Allotment
Percentage—20 percent. The Committee
recommended a 20 percent increase at
its August 24, 2005, meeting.
(G) 2005–2006 Allotment
Percentage—55 percent. This figure is
derived by adding the increase of 20
percent to the initial 2005–2006
allotment percentage of 35 percent.
(H) Calculated Revised 2005–2006
Salable Quantity—1,062,898 pounds.
This figure is 55 percent of the revised
2005–2006 allotment base of 1,932,542
pounds.
(I) Computed Increase in the 2005–
2006 Salable Quantity—386,508
pounds. This figure is 20 percent of the
revised 2005–2006 allotment base of
1,932,542 pounds.
In making this recommendation, the
Committee considered all available
information on price, supply, and
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14:48 Sep 22, 2005
Jkt 205001
demand. The Committee also
considered reports and other
information from handlers and
producers in attendance at the meeting
and reports given by the Committee
manager from handlers who were not in
attendance. The 2005–2006 marketing
year began on June 1, 2005. Handlers
have reported purchases and committed
sales of 682,547 pounds of Scotch
spearmint oil for the period of June 1,
2005, through August 24, 2005. This
amount is 93 percent of the total sales
for the five-year average of 736,991
pounds. Handlers estimated the total
demand for the 2005–2006 marketing
year could be between 917,745 pounds
to 937,745 pounds. These amounts
exceed the five-year average for an
entire marketing year by 180,754
pounds to 200,754 pounds. Therefore,
based on past history, the industry may
not be able to meet market demand
without this increase. When the
Committee made its initial
recommendation for the establishment
of the Scotch spearmint oil salable
quantity and allotment percentage for
the 2005–2006 marketing year, it had
anticipated that the year would end
with an ample available supply.
Native Spearmint Oil Recommendation
(A) Estimated 2005–2006 Allotment
Base—2,169,894 pounds. This is the
estimate on which the original 2005–
2006 Native spearmint oil salable
quantity and allotment percentage was
based.
(B) Revised 2005–2006 Allotment
Base—2,169,362 pounds. This is 532
pounds less than the estimated
allotment base of 2,169,894 pounds.
This is less because some producers
failed to produce all of their 2004–2005
allotment.
(C) Initial 2005–2006 Allotment
Percentage—40 percent. This was
recommended by the Committee on
October 6, 2004.
(D) Initial 2005–2006 Salable
Quantity—867,958. This figure is 40
percent of 2,169,894 pounds.
(E) Initial Adjustment to the 2005–
2006 Salable Quantity—867,745
pounds. This figure reflects the salable
quantity initially available after the
beginning of the 2005–2006 marketing
year due to the 532 pound reduction in
the industry allotment base to 2,169,362
pounds.
(F) Increase in Allotment
Percentage—7 percent. The Committee
recommended a 7 percent increase at its
August 24, 2005, meeting.
(G) 2005–2006 Allotment
Percentage—47 percent. This figure is
derived by adding the increase of 7
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55715
percent to the initial 2005–2006
allotment percentage of 40 percent.
(H) Calculated Revised 2005–2006
Salable Quantity—1,019,600 pounds.
This figure is 47 percent of the revised
2005–2006 allotment base of 2,169,362
pounds.
(I) Computed Increase in the 2005–
2006 Salable Quantity—151,855
pounds. This figure is 7 percent of the
revised 2005–2006 allotment base of
2,169,362 pounds.
In making this recommendation, the
Committee considered all available
information on price, supply, and
demand. The Committee also
considered reports and other
information from handlers and
producers in attendance at the meeting
and reports given by the Committee
manager from handlers who were not in
attendance. The 2005–2006 marketing
year began on June 1, 2005. Handlers
have reported purchases and committed
sales of 742,221 pounds of Native
spearmint oil for the period of June 1,
2005, through August 24, 2005. This
amount is 77 percent of the total sales
for the five-year average of 962,377
pounds. Handlers estimated the total
demand for the 2005–2006 marketing
year could be between 1,122,221
pounds to 1,222,221 pounds. These
amounts exceed the five-year average for
an entire marketing year by 159,844
pounds to 259,844 pounds. Therefore,
based on past history, the industry may
not be able to meet market demand
without this increase. When the
Committee made its initial
recommendation for the establishment
of the Native spearmint oil salable
quantity and allotment percentage for
the 2005–2006 marketing year, it had
anticipated that the year would end
with an ample available supply.
Based on its analysis of available
information, USDA has determined that
the salable quantity and allotment
percentage for Scotch spearmint oil for
the 2005–2006 marketing year should be
increased to 1,062,898 pounds and 55
percent, respectively. In addition, USDA
has determined that the salable quantity
and allotment percentage for Native
spearmint oil for the 2005–2006
marketing year should be increased to
1,019,600 pounds and 47 percent,
respectively.
This rule relaxes the regulation of
Scotch and Native spearmint oil and
will allow for market needs and
improve producer returns. In
conjunction with the issuance of this
rule, the Committee’s revised marketing
policy statement for the 2005–2006
marketing year has been reviewed by
USDA. The Committee’s marketing
policy statement, a requirement
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Federal Register / Vol. 70, No. 184 / Friday, September 23, 2005 / Rules and Regulations
whenever the Committee recommends
implementing volume regulations or
recommends revisions to existing
volume regulations, meets the intent of
§ 985.50 of the order. During its
discussion of revising the 2005–2006
salable quantities and allotment
percentages, the Committee considered:
(1) The estimated quantity of salable oil
of each class held by producers and
handlers; (2) the estimated demand for
each class of oil; (3) prospective
production of each class of oil; (4) total
of allotment bases of each class of oil for
the current marketing year and the
estimated total of allotment bases of
each class for the ensuing marketing
year; (5) the quantity of reserve oil, by
class, in storage; (6) producer prices of
oil, including prices for each class of oil;
and (7) general market conditions for
each class of oil, including whether the
estimated season average price to
producers is likely to exceed parity.
Conformity with USDA’s ‘‘Guidelines
for Fruit, Vegetable, and Specialty Crop
Marketing Orders’’ has also been
reviewed and confirmed.
The increases in the Scotch and
Native spearmint oil salable quantities
and allotment percentages allows for
anticipated market needs for both
classes of oil. In determining anticipated
market needs, consideration by the
Committee was given to historical sales,
and changes and trends in production
and demand.
Initial Regulatory Flexibility Analysis
Pursuant to requirements set forth in
the Regulatory Flexibility Act (RFA), the
Agricultural Marketing Service (AMS)
has considered the economic impact of
this action on small entities.
Accordingly, AMS has prepared this
initial regulatory flexibility analysis.
The purpose of the RFA is to fit
regulatory actions to the scale of
business subject to such actions in order
that small businesses will not be unduly
or disproportionately burdened.
Marketing orders issued pursuant to the
Act, and the rules issued thereunder, are
unique in that they are brought about
through group action of essentially
small entities acting on their own
behalf. Thus, both statutes have small
entity orientation and compatibility.
There are eight spearmint oil handlers
subject to regulation under the order,
and approximately 56 producers of
Scotch spearmint oil and approximately
88 producers of Native spearmint oil in
the regulated production area. Small
agricultural service firms are defined by
the Small Business Administration
(SBA) (13 CFR 121.201) as those having
annual receipts of less than $6,000,000,
and small agricultural producers are
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14:48 Sep 22, 2005
Jkt 205001
defined as those having annual receipts
of less than $750,000.
Based on the SBA’s definition of
small entities, the Committee estimates
that 2 of the 8 handlers regulated by the
order could be considered small
entities. Most of the handlers are large
corporations involved in the
international trading of essential oils
and the products of essential oils. In
addition, the Committee estimates that
14 of the 56 Scotch spearmint oil
producers and 18 of the 88 Native
spearmint oil producers could be
classified as small entities under the
SBA definition. Thus, a majority of
handlers and producers of Far West
spearmint oil may not be classified as
small entities.
The Far West spearmint oil industry
is characterized by producers whose
farming operations generally involve
more than one commodity, and whose
income from farming operations is not
exclusively dependent on the
production of spearmint oil. A typical
spearmint oil-producing operation has
enough acreage for rotation such that
the total acreage required to produce the
crop is about one-third spearmint and
two-thirds rotational crops. Thus, the
typical spearmint oil producer has to
have considerably more acreage than is
planted to spearmint during any given
season. Crop rotation is an essential
cultural practice in the production of
spearmint for weed, insect, and disease
control. To remain economically viable
with the added costs associated with
spearmint oil production, most
spearmint oil-producing farms fall into
the SBA category of large businesses.
Small spearmint oil producers
generally are not as extensively
diversified as larger ones and as such
are more at risk to market fluctuations.
Such small producers generally need to
market their entire annual crop and do
not have the luxury of having other
crops to cushion seasons with poor
spearmint oil returns. Conversely, large
diversified producers have the potential
to endure one or more seasons of poor
spearmint oil markets because income
from alternate crops could support the
operation for a period of time. Being
reasonably assured of a stable price and
market provides small producing
entities with the ability to maintain
proper cash flow and to meet annual
expenses. Thus, the market and price
stability provided by the order
potentially benefit the small producer
more than such provisions benefit large
producers. Even though a majority of
handlers and producers of spearmint oil
may not be classified as small entities,
the volume control feature of this order
has small entity orientation.
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This rule revises the quantity of
Scotch and Native spearmint oil that
handlers may purchase from, or handle
for, producers during the 2005–2006
marketing year, which ends on May 31,
2006. This rule increases the Scotch
spearmint oil salable quantity from
677,409 pounds to 1,062,898 pounds,
and the allotment percentage from 35
percent to 55 percent. In addition, this
rule increases the Native spearmint oil
salable quantity from 867,958 pounds to
1,019,600 pounds, and the allotment
percentage from 40 percent to 47
percent.
An econometric model was used to
assess the impact that volume control
has on the prices producers receive for
their commodity. Without volume
control, spearmint oil markets would
likely be over-supplied, resulting in low
producer prices and a large volume of
oil stored and carried over to the next
crop year. The model estimates how
much lower producer prices would
likely be in the absence of volume
controls.
The recommended allotment
percentages, upon which 2005–2006
producer allotments are based, are 55
percent for Scotch (a 20 percentage
point increase from the original
allotment percentage of 35 percent) and
47 percent for Native (a 7 percentage
point increase from the original salable
percentage of 40 percent). Without
volume controls, producers would not
be limited to these allotment levels, and
could produce and sell additional
spearmint oil. The econometric model
estimated a $1.38 decline in the season
average producer price per pound (from
both classes of spearmint oil) resulting
from the higher quantities that would be
produced and marketed if volume
controls were not used (i.e., if the
salable percentages were set at 100
percent).
Loosening the volume control
restriction by increasing the allotment
percentages resulted in this revised
price decline estimate of $1.38 per
pound if volume controls were not used.
A previous price decline estimate of
$1.60 per pound was based on the
2005–2006 allotment percentages (35
percent for Scotch and 40 percent for
Native) published in the Federal
Register on March 24, 2005 (70 FR
14969). The 2004 Far West producer
price for both classes of spearmint oil
was $9.48 per pound.
The surplus situation for the
spearmint oil market that would exist
without volume controls in 2005–2006
also would likely dampen prospects for
improved producer prices in future
years because of the buildup in stocks.
E:\FR\FM\23SER1.SGM
23SER1
Federal Register / Vol. 70, No. 184 / Friday, September 23, 2005 / Rules and Regulations
The use of volume controls allows the
industry to fully supply spearmint oil
markets while avoiding the negative
consequences of over-supplying these
markets. The use of volume controls is
believed to have little or no effect on
consumer prices of products containing
spearmint oil and will not result in
fewer retail sales of such products.
Based on projections available at the
meeting, the Committee considered
alternatives to the increases. The
Committee not only considered leaving
the salable quantity and allotment
percentage unchanged, but also looked
at various increases ranging from 0
percent to 100 percent. The Committee
reached its recommendations to
increase the salable quantity and
allotment percentage for Scotch and
Native spearmint oil after careful
consideration of all available
information, and believes that the levels
recommended will achieve the
objectives sought. Without the
increases, the Committee believes the
industry would not be able to meet
market needs.
This rule will not impose any
additional reporting or recordkeeping
requirements on either small or large
spearmint oil 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.
In addition, USDA has not identified
any relevant Federal rules that
duplicate, overlap or conflict with this
rule.
Further, the Committee’s meeting was
widely publicized throughout the
spearmint oil industry and all interested
persons were invited to attend the
meeting and participate in Committee
deliberations. Like all Committee
meetings, the August 24, 2005, meeting
was a public meeting and all entities,
both large and small, were able to
express their views on this issue.
Finally, interested persons are invited to
submit information on the regulatory
and informational impacts of this action
on small businesses.
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/
fv/moab.html. Any questions about the
compliance guide should be sent to Jay
Guerber at the previously mentioned
address in the FOR FURTHER INFORMATION
CONTACT section.
This rule invites comments on a
change to the salable quantities and
allotment percentages for Scotch and
Native spearmint oil for the 2005–2006
marketing year. Any comments received
VerDate Aug<31>2005
14:48 Sep 22, 2005
Jkt 205001
will be considered prior to finalization
of this rule.
After consideration of all relevant
material presented, including the
Committee’s recommendation, and
other information, it is found that this
interim final rule, as hereinafter set
forth, will tend to effectuate the
declared policy of the Act.
Pursuant to 5 U.S.C. 553, it is also
found and determined upon good cause
that it is impracticable, unnecessary,
and contrary to the public interest to
give preliminary notice prior to putting
this rule into effect and that good cause
exists for not postponing the effective
date of this rule until 30 days after
publication in the Federal Register
because: (1) This rule increases the
quantity of Scotch and Native spearmint
oil that may be marketed during the
marketing year which ends on May 31,
2005; (2) the current quantity of Scotch
and Native spearmint oil may be
inadequate to meet demand for the
remainder of the marketing year, thus
making the additional oil available as
soon as is practicable is beneficial to
both handlers and producers; (3) the
Committee recommended these changes
at a public meeting and interested
parties had an opportunity to provide
input; and (4) this rule provides a 60day comment period and any comments
received will be considered prior to
finalization of this rule.
List of Subjects in 7 CFR Part 985
Marketing agreements, Oils and fats,
Reporting and recordkeeping
requirements, Spearmint oil.
I For the reasons set forth in the
preamble, 7 CFR part 985 is amended as
follows:
PART 985—MARKETING ORDER
REGULATING THE HANDLING OF
SPEARMINT OIL PRODUCED IN THE
FAR WEST
1. The authority citation for 7 CFR
part 985 continues to read as follows:
I
Authority: 7 U.S.C. 601–674.
2. In § 985.224 paragraph (a) and (b)
are revised to read as follows:
I
Note: This section will not appear in the
annual Code of Federal Regulations.
§ 985.224 Salable quantities and allotment
percentages—2005–2006 marketing year.
*
*
*
*
*
(a) Class 1 (Scotch) oil—a salable
quantity of 1,062,898 pounds and an
allotment percentage of 55 percent.
(b) Class 3 (Native) oil—a salable
quantity of 1,019,600 pounds and an
allotment percentage of 47 percent.
PO 00000
Frm 00013
Fmt 4700
Sfmt 4700
55717
Dated: September 20, 2005.
Lloyd C. Day,
Administrator, Agricultural Marketing
Service.
[FR Doc. 05–19084 Filed 9–21–05; 9:55 am]
BILLING CODE 3410–02–P
DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
18 CFR Part 45
[Docket No. RM05–6–000; Order No. 664]
Commission Authorization To Hold
Interlocking Positions
September 16, 2005.
Federal Energy Regulatory
Commission.
ACTION: Final rule.
AGENCY:
SUMMARY: The Federal Energy
Regulatory Commission (Commission) is
amending its regulations to clarify the
time frame within which individuals
must file applications for authorization
to hold interlocking positions, and the
information provided in certain
informational reports required for
automatic authorization of certain
interlocking positions.
EFFECTIVE DATE: The amended
regulations will become effective
October 24, 2005.
FOR FURTHER INFORMATION CONTACT:
James Akers (Technical Information),
Office of Markets, Tariffs and Rates,
Federal Energy Regulatory
Commission, 888 First Street, NE.,
Washington, DC 20426, (202) 502–
8101.
Melissa Mitchell (Legal Information),
Office of the General Counsel, Federal
Energy Regulatory Commission, 888
First Street, NE., Washington, DC
20426, (202) 502–6038.
SUPPLEMENTARY INFORMATION:
Before Commissioners: Joseph T.
Kelliher, Chairman; Nora Mead
Brownell, and Suedeen G. Kelly.
1. In this final rule, to meet its
responsibility under section 305(b) of
the Federal Power Act (FPA),1 the
Commission amends part 45 of its
regulations 2 to clarify that individuals
seeking Commission authorization to
hold interlocking positions must obtain
such authorization from the
Commission prior to holding that
interlocking position. The Commission
also clarifies the regulations to define
1 16
2 18
E:\FR\FM\23SER1.SGM
U.S.C. 825d(b).
CFR part 45.
23SER1
]]>Agencies
[Federal Register Volume 70, Number 184 (Friday, September 23, 2005)]
[Rules and Regulations]
[Pages 55713-55717]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-19084]
-----------------------------------------------------------------------
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 985
[Docket No. FV05-985-2 IFR]
Marketing Order Regulating the Handling of Spearmint Oil Produced
in the Far West; Revision of the Salable Quantity and Allotment
Percentage for Class 1 (Scotch) and Class 3 (Native) Spearmint Oil for
the 2005-2006 Marketing Year
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Interim final rule with request for comments.
-----------------------------------------------------------------------
SUMMARY: This rule revises the quantity of Class 1 (Scotch) and Class 3
(Native) spearmint oil that handlers may purchase from, or handle for,
producers during the 2005-2006 marketing year. This rule increases the
Scotch spearmint oil salable quantity from 677,409 pounds to 1,062,898
pounds, and the allotment percentage from 35 percent to 55 percent. In
addition, this rule
[[Page 55714]]
increases the Native spearmint oil salable quantity from 867,958 pounds
to 1,019,600 pounds, and the allotment percentage from 40 percent to 47
percent. The order regulates the handling of spearmint oil produced in
the Far West and is administered locally by the Spearmint Oil
Administrative Committee (Committee). The Committee recommended this
rule for the purpose of avoiding extreme fluctuations in supplies and
prices and to help maintain stability in the Far West spearmint oil
market.
DATES: Effective June 1, 2005, through May 31, 2006; comments received
by November 22, 2005 will be considered prior to issuance of a final
rule.
ADDRESSES: Interested persons are invited to submit written comments
concerning this rule. Comments must be sent to the Docket Clerk,
Marketing Order Administration Branch, Fruit and Vegetable Programs,
AMS, USDA, 1400 Independence Avenue SW., STOP 0237, Washington, DC
20250-0237; Fax: (202) 720-8938; E-mail: moab.docketclerk@usda.gov; or
Internet: https://www.regulations.gov. All comments should reference the
docket number and the date and page number of this issue of the Federal
Register and will be made available for public inspection in the Office
of the Docket Clerk during regular business hours, or can be viewed at:
https://www.ams.usda.gov/fv/moab.html.
FOR FURTHER INFORMATION CONTACT: Susan M. Hiller, Northwest Marketing
Field Office, Marketing Order Administration Branch, Fruit and
Vegetable Programs, AMS, USDA; Telephone: (503) 326-2724, Fax: (503)
326-7440; 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 rule is issued under Marketing Order
No. 985 (7 CFR part 985), as amended, regulating the handling of
spearmint oil produced in the Far West (Washington, Idaho, Oregon, and
designated parts of Nevada and Utah), hereinafter referred to as the
``order.'' The order is effective under the Agricultural Marketing
Agreement Act of 1937, as amended (7 U.S.C. 601-674), hereinafter
referred to as the ``Act.''
The Department of Agriculture (USDA) is issuing this rule in
conformance with Executive Order 12866.
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. This rule is not intended to have retroactive effect.
This rule will not preempt any State or local laws, regulations, or
policies, unless they present an irreconcilable conflict with this
rule.
The Act provides that administrative proceedings must be exhausted
before parties may file suit in court. Under section 608c(15)(A) of the
Act, any handler subject to an order may file with USDA a petition
stating that the order, any provision of the order, or any obligation
imposed in connection with the order is not in accordance with law and
request a modification of the order or to be exempted therefrom. 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.
The initial salable quantity and allotment percentages for Scotch
and Native spearmint oil for the 2005-2006 marketing year were
recommended by the Committee at its October 6, 2004, meeting. The
Committee recommended salable quantities of 677,409 pounds and 867,958
pounds, and allotment percentages of 35 percent and 40 percent,
respectively, for Scotch and Native spearmint oil. A proposed rule was
published in the Federal Register on January 12, 2005 (70 FR 2027).
Comments on the proposed rule were solicited from interested persons
until February 11, 2005. No comments were received. Subsequently, a
final rule establishing the salable quantities and allotment
percentages for Scotch and Native spearmint oil for the 2005-2006
marketing year was published in the Federal Register on March 24, 2005
(70 FR 14969).
This rule revises the quantity of Scotch and Native spearmint oil
that handlers may purchase from, or handle for, producers during the
2005-2006 marketing year, which ends on May 31, 2006. Pursuant to
authority contained in Sec. Sec. 985.50, 985.51, and 985.52 of the
order, the Committee met on August 24, 2005, and in two separate
motions, recommended that the 2005-2006 Scotch and Native spearmint oil
allotment percentages be increased by 20 percent and 7 percent,
respectively. With seven of the eight members present at the meeting,
each of the recommendations passed with six members in favor and one
member opposed. In both cases, the members opposing the recommendations
favored larger increases.
Thus, taking into consideration the following discussion on
adjustments to the Scotch and Native spearmint oil salable quantities,
this rule increases the 2005-2006 marketing year salable quantities and
allotment percentages for Scotch and Native spearmint oil to 1,062,898
pounds and 55 percent, and 1,019,600 pounds and 47 percent,
respectively.
The salable quantity is the total quantity of each class of oil
that handlers may purchase from, or handle for, producers during the
marketing year. The total salable quantity is divided by the total
industry allotment base to determine an allotment percentage. Each
producer is allotted a share of the salable quantity by applying the
allotment percentage to the producer's individual allotment base for
the applicable class of spearmint oil.
The original total industry allotment base for Scotch spearmint oil
for the 2005-2006 marketing year was established at 1,935,455 pounds
and was revised at the beginning of the 2005-2006 marketing year to
1,932,542 pounds to reflect a 2004-2005 marketing year loss of 2,913
pounds of base due to non-production of some producers' total annual
allotments. When the revised total allotment base of 1,932,455 pounds
is applied to the originally established allotment percentage of 35
percent, the 2005-2006 marketing year salable quantity of 677,409 is
effectively modified to 676,390 pounds.
The same situation applies to Native spearmint oil where the
original total industry allotment base for the 2005-2006 marketing year
was established at 2,169,894 pounds and was revised at the beginning of
the 2005-2006 marketing year to 2,169,362 pounds to reflect a 2004-2005
marketing year loss of 532 pounds of base due to non-production of some
producers' total annual allotments. When the revised total allotment
base of 2,169,362 pounds is applied to the originally established
allotment percentage of 40 percent, the 2005-2006 marketing year
salable quantity of 867,958 is effectively modified to 867,745 pounds.
[[Page 55715]]
By increasing the salable quantity and allotment percentage, this
rule makes an additional amount of Scotch and Native spearmint oil
available by releasing oil from the reserve pool. When applied to each
individual producer, the allotment percentage increases allow each
producer to take up to an amount equal to their allotment base from
their reserve for each respective class of oil. Before November 1,
2005, a producer may also transfer excess oil to another producer to
enable that producer to fill a deficiency in that producer's annual
allotment for that class of oil.
The following tables summarize the Committee recommendations:
Scotch Spearmint Oil Recommendation
(A) Estimated 2005-2006 Allotment Base--1,935,455 pounds. This is
the estimate on which the original 2005-2006 Scotch spearmint oil
salable quantity and allotment percentage was based.
(B) Revised 2005-2006 Allotment Base--1,932,542 pounds. This is
2,913 pounds less than the estimated allotment base of 1,935,455
pounds. This is less because some producers failed to produce all of
their 2004-2005 allotment.
(C) Initial 2005-2006 Allotment Percentage--35 percent. This was
recommended by the Committee on October 6, 2004.
(D) Initial 2005-2006 Salable Quantity--677,409. This figure is 35
percent of 1,935,455 pounds.
(E) Initial Adjustment to the 2005-2006 Salable Quantity--676,390
pounds. This figure reflects the salable quantity initially available
after the beginning of the 2005-2006 marketing year due to the 2,913
pound reduction in the industry allotment base to 1,932,542 pounds.
(F) Increase in Allotment Percentage--20 percent. The Committee
recommended a 20 percent increase at its August 24, 2005, meeting.
(G) 2005-2006 Allotment Percentage--55 percent. This figure is
derived by adding the increase of 20 percent to the initial 2005-2006
allotment percentage of 35 percent.
(H) Calculated Revised 2005-2006 Salable Quantity--1,062,898
pounds. This figure is 55 percent of the revised 2005-2006 allotment
base of 1,932,542 pounds.
(I) Computed Increase in the 2005-2006 Salable Quantity--386,508
pounds. This figure is 20 percent of the revised 2005-2006 allotment
base of 1,932,542 pounds.
In making this recommendation, the Committee considered all
available information on price, supply, and demand. The Committee also
considered reports and other information from handlers and producers in
attendance at the meeting and reports given by the Committee manager
from handlers who were not in attendance. The 2005-2006 marketing year
began on June 1, 2005. Handlers have reported purchases and committed
sales of 682,547 pounds of Scotch spearmint oil for the period of June
1, 2005, through August 24, 2005. This amount is 93 percent of the
total sales for the five-year average of 736,991 pounds. Handlers
estimated the total demand for the 2005-2006 marketing year could be
between 917,745 pounds to 937,745 pounds. These amounts exceed the
five-year average for an entire marketing year by 180,754 pounds to
200,754 pounds. Therefore, based on past history, the industry may not
be able to meet market demand without this increase. When the Committee
made its initial recommendation for the establishment of the Scotch
spearmint oil salable quantity and allotment percentage for the 2005-
2006 marketing year, it had anticipated that the year would end with an
ample available supply.
Native Spearmint Oil Recommendation
(A) Estimated 2005-2006 Allotment Base--2,169,894 pounds. This is
the estimate on which the original 2005-2006 Native spearmint oil
salable quantity and allotment percentage was based.
(B) Revised 2005-2006 Allotment Base--2,169,362 pounds. This is 532
pounds less than the estimated allotment base of 2,169,894 pounds. This
is less because some producers failed to produce all of their 2004-2005
allotment.
(C) Initial 2005-2006 Allotment Percentage--40 percent. This was
recommended by the Committee on October 6, 2004.
(D) Initial 2005-2006 Salable Quantity--867,958. This figure is 40
percent of 2,169,894 pounds.
(E) Initial Adjustment to the 2005-2006 Salable Quantity--867,745
pounds. This figure reflects the salable quantity initially available
after the beginning of the 2005-2006 marketing year due to the 532
pound reduction in the industry allotment base to 2,169,362 pounds.
(F) Increase in Allotment Percentage--7 percent. The Committee
recommended a 7 percent increase at its August 24, 2005, meeting.
(G) 2005-2006 Allotment Percentage--47 percent. This figure is
derived by adding the increase of 7 percent to the initial 2005-2006
allotment percentage of 40 percent.
(H) Calculated Revised 2005-2006 Salable Quantity--1,019,600
pounds. This figure is 47 percent of the revised 2005-2006 allotment
base of 2,169,362 pounds.
(I) Computed Increase in the 2005-2006 Salable Quantity--151,855
pounds. This figure is 7 percent of the revised 2005-2006 allotment
base of 2,169,362 pounds.
In making this recommendation, the Committee considered all
available information on price, supply, and demand. The Committee also
considered reports and other information from handlers and producers in
attendance at the meeting and reports given by the Committee manager
from handlers who were not in attendance. The 2005-2006 marketing year
began on June 1, 2005. Handlers have reported purchases and committed
sales of 742,221 pounds of Native spearmint oil for the period of June
1, 2005, through August 24, 2005. This amount is 77 percent of the
total sales for the five-year average of 962,377 pounds. Handlers
estimated the total demand for the 2005-2006 marketing year could be
between 1,122,221 pounds to 1,222,221 pounds. These amounts exceed the
five-year average for an entire marketing year by 159,844 pounds to
259,844 pounds. Therefore, based on past history, the industry may not
be able to meet market demand without this increase. When the Committee
made its initial recommendation for the establishment of the Native
spearmint oil salable quantity and allotment percentage for the 2005-
2006 marketing year, it had anticipated that the year would end with an
ample available supply.
Based on its analysis of available information, USDA has determined
that the salable quantity and allotment percentage for Scotch spearmint
oil for the 2005-2006 marketing year should be increased to 1,062,898
pounds and 55 percent, respectively. In addition, USDA has determined
that the salable quantity and allotment percentage for Native spearmint
oil for the 2005-2006 marketing year should be increased to 1,019,600
pounds and 47 percent, respectively.
This rule relaxes the regulation of Scotch and Native spearmint oil
and will allow for market needs and improve producer returns. In
conjunction with the issuance of this rule, the Committee's revised
marketing policy statement for the 2005-2006 marketing year has been
reviewed by USDA. The Committee's marketing policy statement, a
requirement
[[Page 55716]]
whenever the Committee recommends implementing volume regulations or
recommends revisions to existing volume regulations, meets the intent
of Sec. 985.50 of the order. During its discussion of revising the
2005-2006 salable quantities and allotment percentages, the Committee
considered: (1) The estimated quantity of salable oil of each class
held by producers and handlers; (2) the estimated demand for each class
of oil; (3) prospective production of each class of oil; (4) total of
allotment bases of each class of oil for the current marketing year and
the estimated total of allotment bases of each class for the ensuing
marketing year; (5) the quantity of reserve oil, by class, in storage;
(6) producer prices of oil, including prices for each class of oil; and
(7) general market conditions for each class of oil, including whether
the estimated season average price to producers is likely to exceed
parity. Conformity with USDA's ``Guidelines for Fruit, Vegetable, and
Specialty Crop Marketing Orders'' has also been reviewed and confirmed.
The increases in the Scotch and Native spearmint oil salable
quantities and allotment percentages allows for anticipated market
needs for both classes of oil. In determining anticipated market needs,
consideration by the Committee was given to historical sales, and
changes and trends in production and demand.
Initial Regulatory Flexibility Analysis
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA), the Agricultural Marketing Service (AMS) has considered the
economic impact of this action on small entities. Accordingly, AMS has
prepared this initial regulatory flexibility analysis.
The purpose of the RFA is to fit regulatory actions to the scale of
business subject to such actions in order that small businesses will
not be unduly or disproportionately burdened. Marketing orders issued
pursuant to the Act, and the rules issued thereunder, are unique in
that they are brought about through group action of essentially small
entities acting on their own behalf. Thus, both statutes have small
entity orientation and compatibility.
There are eight spearmint oil handlers subject to regulation under
the order, and approximately 56 producers of Scotch spearmint oil and
approximately 88 producers of Native spearmint oil in the regulated
production area. Small agricultural service firms are defined by the
Small Business Administration (SBA) (13 CFR 121.201) as those having
annual receipts of less than $6,000,000, and small agricultural
producers are defined as those having annual receipts of less than
$750,000.
Based on the SBA's definition of small entities, the Committee
estimates that 2 of the 8 handlers regulated by the order could be
considered small entities. Most of the handlers are large corporations
involved in the international trading of essential oils and the
products of essential oils. In addition, the Committee estimates that
14 of the 56 Scotch spearmint oil producers and 18 of the 88 Native
spearmint oil producers could be classified as small entities under the
SBA definition. Thus, a majority of handlers and producers of Far West
spearmint oil may not be classified as small entities.
The Far West spearmint oil industry is characterized by producers
whose farming operations generally involve more than one commodity, and
whose income from farming operations is not exclusively dependent on
the production of spearmint oil. A typical spearmint oil-producing
operation has enough acreage for rotation such that the total acreage
required to produce the crop is about one-third spearmint and two-
thirds rotational crops. Thus, the typical spearmint oil producer has
to have considerably more acreage than is planted to spearmint during
any given season. Crop rotation is an essential cultural practice in
the production of spearmint for weed, insect, and disease control. To
remain economically viable with the added costs associated with
spearmint oil production, most spearmint oil-producing farms fall into
the SBA category of large businesses.
Small spearmint oil producers generally are not as extensively
diversified as larger ones and as such are more at risk to market
fluctuations. Such small producers generally need to market their
entire annual crop and do not have the luxury of having other crops to
cushion seasons with poor spearmint oil returns. Conversely, large
diversified producers have the potential to endure one or more seasons
of poor spearmint oil markets because income from alternate crops could
support the operation for a period of time. Being reasonably assured of
a stable price and market provides small producing entities with the
ability to maintain proper cash flow and to meet annual expenses. Thus,
the market and price stability provided by the order potentially
benefit the small producer more than such provisions benefit large
producers. Even though a majority of handlers and producers of
spearmint oil may not be classified as small entities, the volume
control feature of this order has small entity orientation.
This rule revises the quantity of Scotch and Native spearmint oil
that handlers may purchase from, or handle for, producers during the
2005-2006 marketing year, which ends on May 31, 2006. This rule
increases the Scotch spearmint oil salable quantity from 677,409 pounds
to 1,062,898 pounds, and the allotment percentage from 35 percent to 55
percent. In addition, this rule increases the Native spearmint oil
salable quantity from 867,958 pounds to 1,019,600 pounds, and the
allotment percentage from 40 percent to 47 percent.
An econometric model was used to assess the impact that volume
control has on the prices producers receive for their commodity.
Without volume control, spearmint oil markets would likely be over-
supplied, resulting in low producer prices and a large volume of oil
stored and carried over to the next crop year. The model estimates how
much lower producer prices would likely be in the absence of volume
controls.
The recommended allotment percentages, upon which 2005-2006
producer allotments are based, are 55 percent for Scotch (a 20
percentage point increase from the original allotment percentage of 35
percent) and 47 percent for Native (a 7 percentage point increase from
the original salable percentage of 40 percent). Without volume
controls, producers would not be limited to these allotment levels, and
could produce and sell additional spearmint oil. The econometric model
estimated a $1.38 decline in the season average producer price per
pound (from both classes of spearmint oil) resulting from the higher
quantities that would be produced and marketed if volume controls were
not used (i.e., if the salable percentages were set at 100 percent).
Loosening the volume control restriction by increasing the
allotment percentages resulted in this revised price decline estimate
of $1.38 per pound if volume controls were not used. A previous price
decline estimate of $1.60 per pound was based on the 2005-2006
allotment percentages (35 percent for Scotch and 40 percent for Native)
published in the Federal Register on March 24, 2005 (70 FR 14969). The
2004 Far West producer price for both classes of spearmint oil was
$9.48 per pound.
The surplus situation for the spearmint oil market that would exist
without volume controls in 2005-2006 also would likely dampen prospects
for improved producer prices in future years because of the buildup in
stocks.
[[Page 55717]]
The use of volume controls allows the industry to fully supply
spearmint oil markets while avoiding the negative consequences of over-
supplying these markets. The use of volume controls is believed to have
little or no effect on consumer prices of products containing spearmint
oil and will not result in fewer retail sales of such products.
Based on projections available at the meeting, the Committee
considered alternatives to the increases. The Committee not only
considered leaving the salable quantity and allotment percentage
unchanged, but also looked at various increases ranging from 0 percent
to 100 percent. The Committee reached its recommendations to increase
the salable quantity and allotment percentage for Scotch and Native
spearmint oil after careful consideration of all available information,
and believes that the levels recommended will achieve the objectives
sought. Without the increases, the Committee believes the industry
would not be able to meet market needs.
This rule will not impose any additional reporting or recordkeeping
requirements on either small or large spearmint oil 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.
In addition, USDA has not identified any relevant Federal rules
that duplicate, overlap or conflict with this rule.
Further, the Committee's meeting was widely publicized throughout
the spearmint oil industry and all interested persons were invited to
attend the meeting and participate in Committee deliberations. Like all
Committee meetings, the August 24, 2005, meeting was a public meeting
and all entities, both large and small, were able to express their
views on this issue. Finally, interested persons are invited to submit
information on the regulatory and informational impacts of this action
on small businesses.
A small business guide on complying with fruit, vegetable, and
specialty crop marketing agreements and orders may be viewed at: http:/
/www.ams.usda.gov/fv/moab.html. Any questions about the compliance
guide should be sent to Jay Guerber at the previously mentioned address
in the FOR FURTHER INFORMATION CONTACT section.
This rule invites comments on a change to the salable quantities
and allotment percentages for Scotch and Native spearmint oil for the
2005-2006 marketing year. Any comments received will be considered
prior to finalization of this rule.
After consideration of all relevant material presented, including
the Committee's recommendation, and other information, it is found that
this interim final rule, as hereinafter set forth, will tend to
effectuate the declared policy of the Act.
Pursuant to 5 U.S.C. 553, it is also found and determined upon good
cause that it is impracticable, unnecessary, and contrary to the public
interest to give preliminary notice prior to putting this rule into
effect and that good cause exists for not postponing the effective date
of this rule until 30 days after publication in the Federal Register
because: (1) This rule increases the quantity of Scotch and Native
spearmint oil that may be marketed during the marketing year which ends
on May 31, 2005; (2) the current quantity of Scotch and Native
spearmint oil may be inadequate to meet demand for the remainder of the
marketing year, thus making the additional oil available as soon as is
practicable is beneficial to both handlers and producers; (3) the
Committee recommended these changes at a public meeting and interested
parties had an opportunity to provide input; and (4) this rule provides
a 60-day comment period and any comments received will be considered
prior to finalization of this rule.
List of Subjects in 7 CFR Part 985
Marketing agreements, Oils and fats, Reporting and recordkeeping
requirements, Spearmint oil.
0
For the reasons set forth in the preamble, 7 CFR part 985 is amended as
follows:
PART 985--MARKETING ORDER REGULATING THE HANDLING OF SPEARMINT OIL
PRODUCED IN THE FAR WEST
0
1. The authority citation for 7 CFR part 985 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. In Sec. 985.224 paragraph (a) and (b) are revised to read as
follows:
Note: This section will not appear in the annual Code of Federal
Regulations.
Sec. 985.224 Salable quantities and allotment percentages--2005-2006
marketing year.
* * * * *
(a) Class 1 (Scotch) oil--a salable quantity of 1,062,898 pounds
and an allotment percentage of 55 percent.
(b) Class 3 (Native) oil--a salable quantity of 1,019,600 pounds
and an allotment percentage of 47 percent.
Dated: September 20, 2005.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. 05-19084 Filed 9-21-05; 9:55 am]
BILLING CODE 3410-02-P
