Marketing Order Regulating the Handling of Spearmint Oil Produced in the Far West; Revision of the Salable Quantity and Allotment Percentage for Class 3 (Native) Spearmint Oil for the 2005-2006 Marketing Year, 72355-72358 [05-23620]
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Federal Register / Vol. 70, No. 232 / Monday, December 5, 2005 / Rules and Regulations
Dated: November 23, 2005.
Eric M. Bost,
Under Secretary for Food, Nutrition and
Consumer Services.
[FR Doc. 05–23619 Filed 12–2–05; 8:45 am]
BILLING CODE 3410–30–P
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 985
[Docket No. FV05–985–2 IFR A]
Marketing Order Regulating the
Handling of Spearmint Oil Produced in
the Far West; Revision of the Salable
Quantity and Allotment Percentage for
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 amends a prior
interim final rule that increased 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.
The prior interim final rule increased
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, the prior interim
final rule increased 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. This action does
not affect the Scotch spearmint oil
salable quantity and allotment
percentage; however, it increases the
Native spearmint oil salable quantity by
an additional 151,855 pounds from
1,019,600 pounds to 1,171,455 pounds,
and the allotment percentage by an
additional 7 percent from 47 percent to
54 percent. The marketing 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
February 3, 2006 will be considered
prior to issuance of a final rule.
ADDRESSES: Interested persons are
invited to submit written comments
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18:02 Dec 02, 2005
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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
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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 quantities 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).
Pursuant to authority contained in
§§ 985.50, 985.51, and 985.52 of the
order, the Committee has made
recommendations to increase 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. An interim final rule was
published in the Federal Register on
September 23, 2005 (70 FR 55713),
which increased 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.
Comments on the interim final rule are
being solicited from interested persons
through November 22, 2005.
This rule amends the interim final
rule that was published in the Federal
Register on September 23, 2005, and is
based on a unanimous Committee
recommendation made at a meeting on
October 5, 2005, to increase the Native
spearmint oil salable quantity by an
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Federal Register / Vol. 70, No. 232 / Monday, December 5, 2005 / Rules and Regulations
additional 151,855 pounds from
1,019,600 pounds to 1,171,455 pounds
and the allotment percentage by an
additional 7 percent from 47 percent to
54 percent. The Committee did not
make a recommendation to increase the
Scotch spearmint oil salable quantity or
allotment percentage by an additional
amount at this time due to stable market
conditions.
Thus, taking into consideration the
following discussion on adjustments to
the Native spearmint oil salable
quantity, this rule increases the 2005–
2006 marketing year salable quantity
and allotment percentage for Native
spearmint oil to 1,171,455 pounds and
54 percent, respectively. The 2005–2006
marketing year salable quantity and
allotment percentage for Scotch
spearmint oil remains unchanged at
1,062,898 pounds and 55 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 Native spearmint oil 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 initially
established 2005–2006 marketing year
salable quantity of 867,958 is effectively
modified to 867,745 pounds.
By increasing the salable quantity and
allotment percentage, this rule makes an
additional amount of Native spearmint
oil available by releasing oil from the
reserve pool. When applied to each
individual producer, this allotment
percentage increase allows each
producer to take up to an amount equal
to their allotment base from their Native
oil reserve. This action makes an
additional 80,766 pounds of Native
spearmint oil available to the market.
This figure is less than the salable
quantity increase because not all
producers have enough Native
spearmint oil left in their reserves to
take full advantage of this release. In
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addition, pursuant to §§ 985.56 and
985.156, producers with excess oil are
not able to transfer such excess oil to
other producers to fill deficiencies in
annual allotments after November 1 of
each marketing year. Since this increase
in the Native spearmint oil salable
quantity is effective after November 1,
71,089 pounds of the 151,855 pound
increase is not being made available.
The following table summarizes the
Committee recommendation:
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) First Revision to the 2005–2006
Salable Quantity and Allotment
Percentage.
(1) Increase in Allotment Percentage—
7 percent. The Committee
recommended a 7 percent increase at its
August 24, 2005, meeting.
(2) 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.
(3) 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.
(4) 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.
(G) Second (current) Revision to the
2005–2006 Salable Quantity and
Allotment Percentage.
(1) Increase in Allotment Percentage—
7 percent. The Committee
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recommended a 7 percent increase at its
October 5, 2005, meeting.
(2) 2005–2006 Allotment Percentage—
54 percent. This figure is derived by
adding the increase of 7 percent to the
initial 2005–2006 allotment percentage
of 47 percent.
(3) Calculated Revised 2005–2006
Salable Quantity—1,171,455 pounds.
This figure is 54 percent of the revised
2005–2006 allotment base of 2,169,362
pounds.
(4) 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 1,051,031 pounds of Native
spearmint oil for the period of June 1,
2005, through October 5, 2005. This
amount is 109 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 1,100,000
pounds to 1,300,000 pounds. These
amounts exceed the five-year average for
an entire marketing year by 137,623
pounds to 337,623 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 Native spearmint oil for
the 2005–2006 marketing year should be
increased to 1,171,455 pounds and 54
percent, respectively.
This rule relaxes the regulation of
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 whenever the Committee
recommends implementing volume
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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 increase in the Native spearmint
oil salable quantity and allotment
percentage allows for anticipated market
needs for this class of oil. In
determining anticipated market needs,
consideration by the Committee was
given to historical sales, and changes
and trends in production and demand.
As noted earlier, the Committee chose
not to recommend an additional
increase in Scotch spearmint oil at this
time because of the stable market
conditions. Handlers had reported
purchases and committed sales of
792,382 pounds of Scotch spearmint oil
for the period of June 1, 2005, through
October 5, 2005. Handlers estimate that
the total demand for the 2005–2006
marketing year could be between
800,000 pounds and 950,000 pounds.
Therefore, the current salable quantity
of 1,019,600 pounds should adequately
supply the 2005–2006 marketing year.
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
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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 alternative crops could support the
operation for a period of time. Being
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72357
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 amends an interim final rule
that was published in the Federal
Register on September 23, 2005, and is
based on a unanimous Committee
recommendation made at a meeting on
October 5, 2005, to increase the Native
spearmint oil salable quantity by an
additional 151,855 pounds from
1,019,600 pounds to 1,171,455 pounds,
and the allotment percentage by an
additional 7 percent from 47 percent to
54 percent. The Committee did not
make a recommendation to further
increase the Scotch spearmint oil
salable quantity or allotment percentage
at this time due to stable market
conditions.
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
54 percent for Native (a 14 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 $1.32 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 $1.32 per
pound if volume controls were not used.
The initial price decline estimate of
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$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.
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
October 5, 2005, meeting, the
Committee considered alternatives to
the recommended Native spearmint oil
increase. The Committee not only
considered leaving the salable quantity
and allotment percentage unchanged,
but also looked at various increases
ranging from 0 percent to 10 percent.
The Committee reached its
recommendations to increase the salable
quantity and allotment percentage for
Native spearmint oil after careful
consideration of all available
information, and believes that the levels
recommended will achieve the
objectives sought. Without the increase,
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 meetings
were widely publicized throughout the
spearmint oil industry and all interested
persons were invited to attend and
participate in Committee deliberations.
Like all Committee meetings, the August
24, 2005, and October 5, 2005, meetings
were public meetings and all entities,
both large and small, were able to
express their views on modification of
the 2005–2006 salable quantities and
allotment percentages. Finally,
interested persons are invited to submit
information on the regulatory and
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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
further change to the salable quantity
and allotment percentage for 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 Native spearmint oil that
may be marketed during the marketing
year which ends on May 31, 2006; (2)
the current quantity of 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.
For the reasons set forth in the
preamble, 7 CFR part 985 is amended as
follows:
I
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.
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2. In § 985.224, paragraph (b) is
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.
*
*
*
*
*
(b) Class 3 (Native) oil—a salable
quantity of 1,171,455 pounds and an
allotment percentage of 54 percent.
Dated: November 11, 2005.
Lloyd C. Day,
Administrator, Agricultural Marketing
Service.
[FR Doc. 05–23620 Filed 12–2–05; 8:45 am]
BILLING CODE 3410–02–P
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Part 39
[Docket No. FAA–2005–23144; Directorate
Identifier 2005–NM–218–AD; Amendment
39–14393; AD 2005–24–13]
RIN 2120–AA64
Airworthiness Directives; Learjet
Model 45 Airplanes
Federal Aviation
Administration (FAA), Department of
Transportation (DOT).
ACTION: Final rule; request for
comments.
AGENCY:
SUMMARY: The FAA is adopting a new
airworthiness directive (AD) for certain
Learjet Model 45 airplanes. This AD
requires modifying the electrical wire
bundle for the alternator on the lefthand engine, inspecting for clearance
between wire harnesses and engine
tubing for each engine, and corrective
actions if necessary. For certain
airplanes, this AD also requires
replacing the fuses for the hydraulic
shutoff valves with fuses having higher
amperage. This AD results from a report
of a fire in the left-hand engine nacelle.
We are issuing this AD to prevent
chafing between the wire bundle for the
alternator on each engine and the
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DATES: This AD becomes effective
December 20, 2005.
The Director of the Federal Register
approved the incorporation by reference
of certain publications listed in the AD
as of December 20, 2005.
We must receive comments on this
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ADDRESSES: Use one of the following
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E:\FR\FM\05DER1.SGM
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]]>Agencies
[Federal Register Volume 70, Number 232 (Monday, December 5, 2005)]
[Rules and Regulations]
[Pages 72355-72358]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-23620]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 985
[Docket No. FV05-985-2 IFR A]
Marketing Order Regulating the Handling of Spearmint Oil Produced
in the Far West; Revision of the Salable Quantity and Allotment
Percentage for Class 3 (Native) Spearmint Oil for the 2005-2006
Marketing Year
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Interim final rule with request for comments.
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SUMMARY: This rule amends a prior interim final rule that increased 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. The prior interim final rule increased 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, the prior interim final rule increased 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. This action does
not affect the Scotch spearmint oil salable quantity and allotment
percentage; however, it increases the Native spearmint oil salable
quantity by an additional 151,855 pounds from 1,019,600 pounds to
1,171,455 pounds, and the allotment percentage by an additional 7
percent from 47 percent to 54 percent. The marketing 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 February 3, 2006 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 quantities 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).
Pursuant to authority contained in Sec. Sec. 985.50, 985.51, and
985.52 of the order, the Committee has made recommendations to increase
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. An interim final rule was published
in the Federal Register on September 23, 2005 (70 FR 55713), which
increased 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. Comments
on the interim final rule are being solicited from interested persons
through November 22, 2005.
This rule amends the interim final rule that was published in the
Federal Register on September 23, 2005, and is based on a unanimous
Committee recommendation made at a meeting on October 5, 2005, to
increase the Native spearmint oil salable quantity by an
[[Page 72356]]
additional 151,855 pounds from 1,019,600 pounds to 1,171,455 pounds and
the allotment percentage by an additional 7 percent from 47 percent to
54 percent. The Committee did not make a recommendation to increase the
Scotch spearmint oil salable quantity or allotment percentage by an
additional amount at this time due to stable market conditions.
Thus, taking into consideration the following discussion on
adjustments to the Native spearmint oil salable quantity, this rule
increases the 2005-2006 marketing year salable quantity and allotment
percentage for Native spearmint oil to 1,171,455 pounds and 54 percent,
respectively. The 2005-2006 marketing year salable quantity and
allotment percentage for Scotch spearmint oil remains unchanged at
1,062,898 pounds and 55 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 Native spearmint oil
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 initially established 2005-2006 marketing year salable
quantity of 867,958 is effectively modified to 867,745 pounds.
By increasing the salable quantity and allotment percentage, this
rule makes an additional amount of Native spearmint oil available by
releasing oil from the reserve pool. When applied to each individual
producer, this allotment percentage increase allows each producer to
take up to an amount equal to their allotment base from their Native
oil reserve. This action makes an additional 80,766 pounds of Native
spearmint oil available to the market. This figure is less than the
salable quantity increase because not all producers have enough Native
spearmint oil left in their reserves to take full advantage of this
release. In addition, pursuant to Sec. Sec. 985.56 and 985.156,
producers with excess oil are not able to transfer such excess oil to
other producers to fill deficiencies in annual allotments after
November 1 of each marketing year. Since this increase in the Native
spearmint oil salable quantity is effective after November 1, 71,089
pounds of the 151,855 pound increase is not being made available.
The following table summarizes the Committee recommendation:
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) First Revision to the 2005-2006 Salable Quantity and Allotment
Percentage.
(1) Increase in Allotment Percentage--7 percent. The Committee
recommended a 7 percent increase at its August 24, 2005, meeting.
(2) 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.
(3) 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.
(4) 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.
(G) Second (current) Revision to the 2005-2006 Salable Quantity and
Allotment Percentage.
(1) Increase in Allotment Percentage--7 percent. The Committee
recommended a 7 percent increase at its October 5, 2005, meeting.
(2) 2005-2006 Allotment Percentage--54 percent. This figure is
derived by adding the increase of 7 percent to the initial 2005-2006
allotment percentage of 47 percent.
(3) Calculated Revised 2005-2006 Salable Quantity--1,171,455
pounds. This figure is 54 percent of the revised 2005-2006 allotment
base of 2,169,362 pounds.
(4) 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 1,051,031 pounds of Native spearmint oil for the period of
June 1, 2005, through October 5, 2005. This amount is 109 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 1,100,000 pounds to 1,300,000 pounds. These amounts exceed the
five-year average for an entire marketing year by 137,623 pounds to
337,623 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 Native spearmint
oil for the 2005-2006 marketing year should be increased to 1,171,455
pounds and 54 percent, respectively.
This rule relaxes the regulation of 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
whenever the Committee recommends implementing volume
[[Page 72357]]
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 increase in the Native spearmint oil salable quantity and
allotment percentage allows for anticipated market needs for this class
of oil. In determining anticipated market needs, consideration by the
Committee was given to historical sales, and changes and trends in
production and demand.
As noted earlier, the Committee chose not to recommend an
additional increase in Scotch spearmint oil at this time because of the
stable market conditions. Handlers had reported purchases and committed
sales of 792,382 pounds of Scotch spearmint oil for the period of June
1, 2005, through October 5, 2005. Handlers estimate that the total
demand for the 2005-2006 marketing year could be between 800,000 pounds
and 950,000 pounds. Therefore, the current salable quantity of
1,019,600 pounds should adequately supply the 2005-2006 marketing year.
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 alternative 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 amends an interim final rule that was published in the
Federal Register on September 23, 2005, and is based on a unanimous
Committee recommendation made at a meeting on October 5, 2005, to
increase the Native spearmint oil salable quantity by an additional
151,855 pounds from 1,019,600 pounds to 1,171,455 pounds, and the
allotment percentage by an additional 7 percent from 47 percent to 54
percent. The Committee did not make a recommendation to further
increase the Scotch spearmint oil salable quantity or allotment
percentage at this time due to stable market conditions.
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 54 percent for Native (a 14 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 $1.32 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 $1.32 per pound if volume controls were not used. The initial price
decline estimate of
[[Page 72358]]
$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.
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 October 5, 2005, meeting, the
Committee considered alternatives to the recommended Native spearmint
oil increase. The Committee not only considered leaving the salable
quantity and allotment percentage unchanged, but also looked at various
increases ranging from 0 percent to 10 percent. The Committee reached
its recommendations to increase the salable quantity and allotment
percentage for Native spearmint oil after careful consideration of all
available information, and believes that the levels recommended will
achieve the objectives sought. Without the increase, 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 meetings were widely publicized throughout
the spearmint oil industry and all interested persons were invited to
attend and participate in Committee deliberations. Like all Committee
meetings, the August 24, 2005, and October 5, 2005, meetings were
public meetings and all entities, both large and small, were able to
express their views on modification of the 2005-2006 salable quantities
and allotment percentages. 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 further change to the salable
quantity and allotment percentage for 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 Native spearmint oil
that may be marketed during the marketing year which ends on May 31,
2006; (2) the current quantity of 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 (b) is 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.
* * * * *
(b) Class 3 (Native) oil--a salable quantity of 1,171,455 pounds
and an allotment percentage of 54 percent.
Dated: November 11, 2005.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. 05-23620 Filed 12-2-05; 8:45 am]
BILLING CODE 3410-02-P
