Raisins Produced From Grapes Grown in California; Final Free and Reserve Percentages for 2005-06 Crop Natural (Sun-Dried) Seedless Raisins, 29567-29571 [06-4747]
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Federal Register / Vol. 71, No. 99 / Tuesday, May 23, 2006 / Rules and Regulations
2. In § 945.341, paragraph (g) is
revised to read as follows:
I
§ 945.341
Handling regulation.
*
*
*
*
*
(g) Minimum quantity exemption.
Each handler may ship up to, but not to
exceed, five hundredweight of potatoes
any day without regard to the inspection
and assessment requirements of this
part, but this exception shall not apply
to any shipment that exceeds five
hundredweight of potatoes.
*
*
*
*
*
Dated: May 17, 2006.
Lloyd C. Day,
Administrator, Agricultural Marketing
Service.
[FR Doc. 06–4748 Filed 5–22–06; 8:45 am]
BILLING CODE 3410–02–P
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 989
[Docket No. FV06–989–2 IFR]
Raisins Produced From Grapes Grown
in California; Final Free and Reserve
Percentages for 2005–06 Crop Natural
(Sun-Dried) Seedless Raisins
Agricultural Marketing Service,
USDA.
ACTION: Interim final rule with request
for comments.
dsatterwhite on PROD1PC76 with RULES
AGENCY:
SUMMARY: This rule establishes final
volume regulation percentages for 2005–
06 crop Natural (sun-dried) Seedless
(NS) raisins covered under the Federal
marketing order for California raisins
(order). The order regulates the handling
of raisins produced from grapes grown
in California and is locally administered
by the Raisin Administrative Committee
(Committee). The volume regulation
percentages are 82.50 percent free and
17.50 percent reserve. The percentages
are intended to help stabilize raisin
supplies and prices, and strengthen
market conditions.
DATES: Effective August 1, 2005, through
July 31, 2006. The volume regulation
percentages apply to acquisitions of NS
raisins from the 2005–06 crop until the
reserve raisins from that crop are
disposed of under the marketing order.
Comments received by July 24, 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
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19:30 May 22, 2006
Jkt 208001
Vegetable Programs, AMS, USDA, 1400
Independence Avenue, SW., STOP
0237, Washington, DC 20250–0237; Fax:
(202) 720–8938; or 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: Kurt
Kimmel, Officer-in-Charge, or Rose M.
Aguayo, Marketing Specialist, California
Marketing Field Office, Marketing Order
Administration Branch, Fruit and
Vegetable Programs, AMS, USDA;
Telephone: (559) 487–5901; Fax: (559)
487–5906.
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 Agreement
and Order No. 989 (7 CFR part 989),
both as amended, regulating the
handling of raisins produced from
grapes grown in California, hereinafter
referred to as the ‘‘order.’’ The order is
effective under the Agricultural
Marketing Agreement Act of 1937, as
amended (7 U.S.C. 601–674), hereinafter
referred to as the ‘‘Act.’’
The Department of Agriculture
(USDA) is issuing this rule in
conformance with Executive Order
12866.
This rule has been reviewed under
Executive Order 12988, Civil Justice
Reform. Under the order provisions now
in effect, final free and reserve
percentages may be established for
raisins acquired by handlers during the
crop year. This rule establishes final free
and reserve percentages for NS raisins
for the 2005–06 crop year, which began
August 1, 2005, and ends July 31, 2006.
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
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29567
obligation imposed in connection with
the order is not in accordance with law
and request a modification of the order
or to be exempted therefrom. A handler
is afforded the opportunity for a hearing
on the petition. After the hearing USDA
would rule on the petition. The Act
provides that the district court of the
United States in any district in which
the handler is an inhabitant, or has his
or her principal place of business, has
jurisdiction to review USDA’s ruling on
the petition, provided an action is filed
not later than 20 days after the date of
the entry of the ruling.
This rule establishes final volume
regulation percentages for 2005–06 crop
NS raisins covered under the order. The
volume regulation percentages are 82.50
percent free and 17.50 percent reserve.
Free tonnage raisins may be sold by
handlers to any market. Reserve raisins
must be held in a pool for the account
of the Committee and are disposed of
through various programs authorized
under the order. For example, reserve
raisins may be sold by the Committee to
handlers for free use or to replace part
of the free tonnage raisins they
exported; used in diversion programs;
carried over as a hedge against a short
crop; or disposed of in other outlets not
competitive with those for free tonnage
raisins, such as government purchase,
distilleries, or animal feed.
The volume regulation percentages
are intended to help stabilize raisin
supplies and prices, and strengthen
market conditions. The Committee
unanimously recommended final
percentages on January 26, 2006, and
further justified their recommendation
on March 16, 2006.
Computation of Trade Demands
Section 989.54 of the order prescribes
procedures and time frames to be
followed in establishing volume
regulation. This includes methodology
used to calculate percentages. Pursuant
to § 989.54(a) of the order, the
Committee met on August 15, 2005, to
review shipment and inventory data,
and other matters relating to the
supplies of raisins of all varietal types.
The Committee computed a trade
demand for each varietal type for which
a free tonnage percentage might be
recommended. Trade demand is
computed using a formula specified in
the order and, for each varietal type, is
equal to 90 percent of the prior year’s
shipments of free tonnage and reserve
tonnage raisins sold for free use into all
market outlets, adjusted by subtracting
the carryin on August 1 of the current
crop year, and adding the desirable
carryout at the end of that crop year. As
specified in § 989.154(a), the desirable
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The preliminary percentages were 74
percent free and 26 percent reserve.
In addition, preliminary percentages
were also announced for Dipped
Seedless, Golden Seedless, Zante
Currant, and Other Seedless raisins. It
was ultimately determined that volume
regulation was only warranted for NS
raisins. As in past seasons, the
Committee submitted its marketing
policy to USDA for review.
normal processing shrinkage being
experienced with the 2005 NS raisin
crop. With a lower crop estimate, more
free tonnage raisins will be made
available to handlers for free tonnage
use, but due to the above normal
processing shrinkage, the Committee
expects supplies to be in balance with
market needs.
By the week ending April 5, 2006,
data showed that deliveries of NS
raisins were at 301,019 tons of NS
Computation of Final Volume
raisins. Thus, it is likely that final
Regulation Percentages
deliveries may reach 311,493 tons by
July 31, 2006—the end of the crop year.
Pursuant to § 989.54(c), at its January
The Committee’s recommendation will
26, 2006, meeting, the Committee
provide handlers with 7.5 percent more
announced interim percentages for NS
raisins than would be provided if a
raisins to release slightly less than the
311,493 ton estimate had been used, but
full trade demand. Based on a revised
the additional tonnage is not expected
NS crop estimate of 283,000 tons (up
to cause disorderly marketing
from the October estimate of 266,227
tons), interim percentages for NS raisins conditions.
COMPUTED TRADE DEMANDS
In addition, USDA’s ‘‘Guidelines for
were announced at 82.25 percent free
[Natural condition tons]
Fruit, Vegetable, and Specialty Crop
and 17.75 percent reserve.
Marketing Orders’’ (Guidelines) specify
Pursuant to § 989.54(d), the
NS
that 110 percent of recent years’ sales
raisins
Committee also recommended final
should be made available to primary
percentages at its January 26, 2006,
Prior year’s shipments ..................
319,752 meeting to release the full trade
markets each season for marketing
Multiplied by 90 percent ...............
0.90
orders utilizing reserve pool authority.
demands for NS raisins. Final
Equals adjusted base ...................
287,777
percentages were recommended at 82.50 This goal will be met for NS raisins by
Minus carryin inventory ................
114,792
the establishment of final percentages,
Plus desirable caryout ..................
60,000 percent free and 17.50 percent reserve.
which release 100 percent of the trade
The Committee’s calculations and
Equals computed NS trade Dedemand and the offer of additional
mand .........................................
232,985 determinations to arrive at final
reserve raisins for sale to handlers under
percentages for NS raisins are shown in
the ‘‘10 plus 10 offers.’’ As specified in
the table below:
Computation of Preliminary Volume
§ 989.54(g), the 10 plus 10 offers are two
Regulation Percentages
offers of reserve pool raisins which are
FINAL VOLUME REGULATION
Section 989.54(b) of the order requires
made available to handlers during each
PERCENTAGES
that the Committee announce, on or
season. For each such offer, a quantity
[Natural condition tons]
before October 5, preliminary crop
of reserve raisins equal to 10 percent of
estimates and determine whether
the prior year’s shipments is made
NS
volume regulation is warranted for the
available for free use. Handlers may sell
raisins
varietal types for which it computed a
their 10 plus 10 raisins to any market.
trade demand. That section allows the
For NS raisins, the first 10 plus 10
Trade demand ..............................
232,985
Committee to extend the October 5 date
Divided by crop estimate ..............
283,000 offer was made in February 2006. A
up to 5 business days if warranted by a
Equals the free percentage ..........
82.30 total of 31,975 tons was made available
late crop.
100 minus free percentage equals
to raisin handlers; all of the raisins were
The Committee met on October 4,
the reserve percentage .............
17.70 purchased. The second 10 plus 10 offer
2005, and announced a preliminary
of 31,975 tons will be made available to
crop estimate for NS raisins of 266,227
* * * The Committee recommended
handlers by July 31, 2006. Adding the
tons, which is about 19 percent lower
rounding the free percentage to 82.50
total figure of 63,950 tons of 10 plus 10
than the 10-year average of 328,088
percent and reducing the reserve
raisins to the 232,985 ton trade demand
tons. NS raisins are the major varietal
percentage to 17.50 percent to
figure, plus 114,792 tons of 2004–05
type of California raisin. Adding the
compensate for the higher than normal
carryin NS inventory equates to 411,727
carryin inventory of 114,792 tons, plus
processing shrinkage being experienced tons of natural condition raisins, or
the 266,227-ton crop estimate resulted
by handlers with the 2006 NS crop.
386,855 tons of packed raisins, that are
in a total available supply of 381,019
By the week ending February 11,
available to handlers for free use or
tons, which was significantly higher
2006, data showed that deliveries of NS primary markets. This is about 130
(164 percent) than the 232,985-ton trade raisins exceeded the Committee’s crop
percent of the quantity of NS raisins
demand. Thus, the Committee
estimate of 283,000 tons. By that date,
shipped during the 2004–05 crop year
determined that volume regulation for
deliveries of NS raisins totaled 285,052
(317,998 natural condition tons or
NS raisins was warranted. The
tons. Thus, at USDA’s request, the RAC
300,435 packed tons).
Committee announced preliminary free
met again on March 16, 2006, and
In addition to the 10 plus 10 offers,
and reserve percentages for NS raisins,
reviewed the current available data and
§ 989.67(j) of the order provides
which released 85 percent of the
the computations used in arriving at the authority for sales of reserve raisins to
computed trade demand since a
recommended final percentages.
handlers under certain conditions such
minimum field price (price paid by
At the March meeting, the Committee as a national emergency, crop failure,
handlers to producers for their free
continued to support a crop estimate of
change in economic or marketing
tonnage raisins) had been established.
283,000 tons, because of the higher than conditions, or if free tonnage shipments
carryout for NS raisins shall equal the
total shipments of free tonnage during
August and September for each of the
past 5 crop years, converted to a natural
condition basis, dropping the high and
low figures, and dividing the remaining
sum by three, or 60,000 natural
condition tons, whichever is higher. For
all other varietal types, the desirable
carryout shall equal the total shipments
of free tonnage during August,
September and one-half of October for
each of the past 5 crop years, converted
to a natural condition basis, dropping
the high and low figures, and dividing
the remaining sum by three. In
accordance with these provisions, the
Committee computed and announced
the 2005–06 trade demand for NS
raisins at 232,985 tons as shown below.
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in the current crop year exceed
shipments of a comparable period of the
prior crop year. Such reserve raisins
may be sold by handlers to any market.
When implemented, the additional
offers of reserve raisins make even more
raisins available to primary markets,
which is consistent with USDA’s
Guidelines.
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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 rules issued thereunder, are
unique in that they are brought about
through group action of essentially
small entities acting on their own
behalf. Thus, both statutes have small
entity orientation and compatibility.
There are approximately 20 handlers
of California raisins who are subject to
regulation under the order and
approximately 4,500 raisin producers in
the regulated area. Small agricultural
firms are defined by the Small Business
Administration (13 CFR 121.201) as
those having annual receipts of less than
$6,500,000, and small agricultural
producers are defined as those having
annual receipts of less than $750,000.
Eleven of the 20 handlers subject to
regulation have annual sales estimated
to be at least $6,500,000, and the
remaining 9 handlers have sales less
than $6,500,000. No more than 9
handlers and a majority of producers of
California raisins may be classified as
small entities.
Since 1949, the California raisin
industry has operated under a Federal
marketing order. The order contains
authority to, among other things, limit
the portion of a given year’s crop that
can be marketed freely in any outlet by
raisin handlers. This volume control
mechanism is used to stabilize supplies
and prices and strengthen market
conditions.
Pursuant to § 989.54(d) of the order,
this rule establishes final volume
regulation percentages for 2005–06 crop
NS raisins. The volume regulation
percentages are 82.50 percent free and
17.50 percent reserve. Free tonnage
raisins may be sold by handlers to any
market. Reserve raisins must be held in
a pool for the account of the Committee
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and are disposed of through certain
programs authorized under the order.
Volume regulation is warranted this
season because the revised crop
estimate of 283,000 tons combined with
the carryin inventory of 114,792 tons
results in a total available supply of
397,792 tons, which is about 70 percent
higher than the 232,985 ton trade
demand.
The current volume regulation
procedures have helped the industry
address its marketing problems by
keeping supplies in balance with
domestic and export market needs, and
strengthening market conditions. The
current volume regulation procedures
fully supply the domestic and export
markets, provide for market expansion,
and help reduce the burden of
oversupplies in the domestic market.
Raisin grapes are a perennial crop, so
production in any year is dependent
upon plantings made in earlier years.
The sun-drying method of producing
raisins involves considerable risk
because of variable weather patterns.
Even though the product and the
industry are viewed as mature, the
industry has experienced considerable
change over the last several decades.
Before the 1975–76 crop year, more than
50 percent of the raisins were packed
and sold directly to consumers. Now,
about 65 percent of raisins are sold in
bulk. This means that raisins are now
sold to consumers mostly as an
ingredient in another product such as
cereal and baked goods. In addition, for
a few years in the early 1970’s, over 50
percent of the raisin grapes were sold to
the wine market for crushing. Since
then, the percent of raisin-variety grapes
sold to the wine industry has decreased.
California’s grapes are classified into
three groups—table grapes, wine grapes,
and raisin-variety grapes. Raisin-variety
grapes are the most versatile of the three
types. They can be marketed as fresh
grapes, crushed for juice in the
production of wine or juice concentrate,
or dried into raisins. Annual
fluctuations in the fresh grape, wine,
and concentrate markets, as well as
weather-related factors, cause
fluctuations in raisin supply. This type
of situation introduces a certain amount
of variability into the raisin market.
Although the size of the crop for raisinvariety grapes may be known, the
amount dried for raisins depends on the
demand for crushing. This makes the
marketing of raisins a more difficult
task. These supply fluctuations can
result in producer price instability and
disorderly market conditions.
Volume regulation is helpful to the
raisin industry because it lessens the
impact of such fluctuations and
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29569
contributes to orderly marketing. For
example, producer prices for NS raisins
remained fairly steady between the
1993–94 through the 1997–98 seasons,
although production varied. As shown
in the table below, during those years,
production varied from a low of 272,063
tons in 1996–97 to a high of 387,007
tons in 1993–94.
According to Committee data, the
total producer return per ton during
those years, which includes proceeds
from both free tonnage plus reserve pool
raisins, has varied from a low of $904.60
in 1993–94 to a high of $1,049 in 1996–
97. Total producer prices for the 1998–
99 and 1999–2000 seasons increased
significantly due to back-to-back short
crops during those years. Producer
prices dropped dramatically for the
2000–01, 2001–02, and 2002–03 crop
years due to record-size production,
large carry-in inventories, and stagnant
demand. However, the producer prices
increased slightly with a shorter crop in
2003–04 and rebounded to pre-1998–99
prices during the 2004–05 crop years as
noted below:
NATURAL SEEDLESS PRODUCER
PRICES
Crop year
2004–05 ............
2003–04 ............
2002–03 ............
2001–02 ............
2000–01 ............
1999–2000 ........
1998–99 ............
1997–98 ............
1996–97 ............
1995–96 ............
1994–95 ............
1993–94 ............
Deliveries
(natural
condition
tons)
265,262
296,864
388,010
377,328
432,616
299,910
240,469
382,448
272,063
325,911
378,427
387,007
Producer
prices
(per ton)
2 $1210.00
1 567.00
1 491.20
650.94
603.36
1,211.25
2 1,290.00
946.52
1,049.20
1,007.19
928.27
904.60
1 Return-to-date,
2 No
reserve pool still open.
volume regulation.
There are essentially two broad
markets for raisins—domestic and
export. In recent years, both domestic
and export shipments have been
increasing. Domestic shipments
decreased from a high of 204,805
packed tons during the 1990–91 crop
year to a low of 156,325 packed tons in
1999–2000. Since that time domestic
shipments steadily increased from
174,117 packed tons during the 2000–01
crop year to 193,680 packed tons during
the 2004–05 crop year. In addition,
exports decreased from 114,576 packed
tons in 1991–92 to a low of 91,600
packed tons in the 1999–2000 crop year.
In recent years, export shipments have
increased from a low of 101,537 tons
during the 2002–03 crop year to 106,755
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tons of raisins during the 2004–05 crop
year.
Moreover, the per capita consumption
of raisins has declined from 2.09
pounds in 1988 to 1.46 pounds in 2004.
This decrease is consistent with the
decrease in the per capita consumption
of dried fruits in general, which is due
to the increasing availability of most
types of fresh fruit throughout the year.
While the overall demand for raisins
has been increasing (as reflected in
increased in commercial shipments),
production has been decreasing.
Deliveries of NS dried raisins from
producers to handlers reached an alltime high of 432,616 tons in the 2000–
01 crop year. This large crop was
preceded by two short crop years;
deliveries were 240,469 tons in 1998–99
and 299,910 tons in 1999–2000.
Deliveries for the 2000–01 crop year
soared to a record level because of
increased bearing acreage and yields.
Deliveries for the 2001–02 crop year
were at 377,328 tons, 388,010 tons for
the 2002–03 crop year, 296,864 for the
2003–04 crop year and 265,262 tons for
the 2004–05 crop year. After three crop
years of high production and a large
2001–02 carryin inventory, the industry
diverted raisins or removed 41,000 acres
in 2001; 27,000 acres in 2002; and
15,000 acres of vines in 2003 to reduce
the industry’s burdensome supply of
raisins. These actions resulted in
declining deliveries of 296,865 tons for
the 2003–04 crop year and 265,262 tons
for the 2004–05 crop year.
The order permits the industry to
exercise supply control provisions,
which allow for the establishment of
free and reserve percentages, and
establishment of a reserve pool. One of
the primary purposes of establishing
free and reserve percentages is to
equilibrate supply and demand. If raisin
markets are over-supplied with product,
producer prices will decline.
Raisins are generally marketed at
relatively lower price levels in the more
elastic export market than in the more
inelastic domestic market. This results
in a larger volume of raisins being
marketed and enhances producer
returns. In addition, this system allows
the U.S. raisin industry to be more
competitive in export markets.
To assess the impact that volume
control has on the prices producers
receive for their product, an
econometric model has been
constructed. The model developed is for
the purpose of estimating nominal
prices under a number of scenarios
using the volume control authority
under the Federal marketing order. The
price producers receive for the harvest
and delivery of their crop is largely
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determined by the level of production
and the volume of carryin inventories.
The Federal marketing order permits the
industry to exercise supply control
provisions, which allow for the
establishment of reserve and free
percentages for primary markets, and a
reserve pool. The establishment of
reserve percentages impacts the
production that is marketed in the
primary markets.
The reserve percentage limits what
handlers can market as free tonnage.
Assuming the 17.50 percent reserve
limits the total free tonnage to 233,475
natural condition tons (.8250 x the
283,000-ton crop estimate) and carryin
is 114,792 natural condition tons, and
all of the 63,950 natural condition tons
of reserve raisins offered for sale under
the 10 plus 10 offers are purchased, then
the total free supply is estimated at
412,217 natural condition tons. Data
available as of April 5, 2006, shows that
deliveries of NS raisins are at 301,019
tons. If the Committee used a 311,493
ton crop estimate, and assuming a 25.2
percent reserve limits the total free
tonnage to 232,996 natural condition
tons (.7480 x the 311,493-ton crop
estimate) and carryin and 10+10 offers
and purchases remained the same, then
the total free supply would be estimated
at 411,738 natural condition tons, a
difference of 479 tons. The Committee
believes that this additional tonnage
will provide handlers with enough free
tonnage to compensate for the above
normal processing shrink being
experienced with this season’s crop.
The econometric model estimates
prices to be $63 per ton higher than
under an unregulated scenario. This
price increase is beneficial to all
producers regardless of size and
enhances producers’ total revenues in
comparison to no volume control.
Establishing a reserve allows the
industry to help stabilize supplies in
both domestic and export markets,
while improving returns to producers.
Free and reserve percentages are
established by varietal type, and usually
in years when the supply exceeds the
trade demand by a large enough margin
that the Committee believes volume
regulation is necessary to maintain
market stability. Accordingly, in
assessing whether to apply volume
regulation or, as an alternative, not to
apply such regulation, it has been
determined that volume regulation is
warranted this season for only one of
the nine raisin varietal types defined
under the order.
The free and reserve percentages
established by this rule release the full
trade demand and apply uniformly to
all handlers in the industry, regardless
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of size. For NS raisins, with the
exception of the 1998–99 and 2004–05
crop years, small and large raisin
producers and handlers have been
operating under volume regulation
percentages every year since 1983–84.
There are no known additional costs
incurred by small handlers that are not
incurred by large handlers. While the
level of benefits of this rulemaking are
difficult to quantify, the stabilizing
effects of the volume regulations impact
small and large handlers positively by
helping them maintain and expand
markets even though raisin supplies
fluctuate widely from season to season.
Likewise, price stability positively
impacts small and large producers by
allowing them to better anticipate the
revenues their raisins will generate.
There are some reporting,
recordkeeping and other compliance
requirements under the order. The
reporting and recordkeeping burdens
are necessary for compliance purposes
and for developing statistical data for
maintenance of the program. The
requirements are the same as those
applied in past seasons. Thus, this
action imposes no additional reporting
or recordkeeping requirements on either
small or large raisin handlers. The forms
require information which is readily
available from handler records and
which can be provided without data
processing equipment or trained
statistical staff. The information
collection and recordkeeping
requirements have been previously
approved by the Office of Management
and Budget (OMB) under OMB Control
No. 0581–0178. As with all Federal
marketing order programs, reports and
forms are periodically reviewed to
reduce information requirements and
duplication by industry and public
sector agencies.
AMS is committed to compliance
with the Government Paperwork
Elimination Act (GPEA), which requires
Government agencies in general to
provide the public the option of
submitting information or transacting
business electronically to the maximum
extent possible.
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
raisin industry and all interested
persons were invited to attend the
meetings and participate in the
Committee’s deliberations. Like all
Committee meetings, the August 15,
2005, October 4, 2005, January 26, 2006,
and March 16, 2006, meetings were
public meetings and all entities, both
E:\FR\FM\23MYR1.SGM
23MYR1
dsatterwhite on PROD1PC76 with RULES
Federal Register / Vol. 71, No. 99 / Tuesday, May 23, 2006 / Rules and Regulations
large and small, were able to express
their views on this issue.
Also, the Committee has a number of
appointed subcommittees to review
certain issues and make
recommendations to the Committee.
The Committee’s Reserve Sales and
Marketing Subcommittee met on August
15, 2005, October 4, 2005, January 26,
2006, and March 16, 2006, and
discussed these issues in detail. Those
meetings were also public meetings and
both large and small entities were able
to participate and express their views.
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 the
establishment of final volume regulation
percentages for 2005–06 crop NS raisins
covered under the order. Any comments
received will be considered prior to
finalization of this rule.
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.
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) The relevant provisions of
this part require that the percentages
designated herein for the 2005–06 crop
year apply to all NS raisins acquired
from the beginning of that crop year; (2)
handlers are currently marketing their
2005–06 crop NS raisins and this action
should be taken promptly to achieve the
intended purpose of making the full
trade demand available to handlers; (3)
handlers are aware of this action, which
was unanimously recommended at a
public meeting, and need no additional
time to comply with these percentages;
and (4) this interim final rule provides
a 60-day comment period, and all
comments timely received will be
considered prior to finalization of this
rule.
VerDate Aug<31>2005
19:30 May 22, 2006
Jkt 208001
List of Subjects in 7 CFR Part 989
29571
SUMMARY: This interim rule amends
Department of Homeland Security
Grapes, Marketing agreements,
regulations to change the process
Raisins, Reporting and recordkeeping
whereby U.S. Citizenship and
requirements.
Immigration Services will notify the
I For the reasons set forth in the
public of the dates and conditions for
preamble, 7 CFR part 989 is amended to Premium Processing Service of
read as follows:
designated employment-based petitions
and applications. This interim rule also
PART 989—RAISINS PRODUCED
clarifies that notices announcing the
FROM GRAPES GROWN IN
designation of petitions and
CALIFORNIA
applications for Premium Processing
Service will identify the individual
I 1. The authority citation for 7 CFR
classifications within each designated
part 989 continues to read as follows:
petition or application that will be
Authority: 7 U.S.C. 601–674.
eligible for premium processing.
I 2. Section 989.258 is added to
DATES: Effective date: This interim rule
Subpart—Supplementary Regulations to is effective May 23, 2006.
read as follows:
Comment date: Written comments
must be submitted on or before July 24,
Note: This section will not appear in the
annual Code of Federal Regulations.
2006.
ADDRESSES: You may submit comments,
§ 989.258 Final free and reserve
identified by DHS Docket No. USCIS
percentages for the 2005–06 crop year.
2005–0038, by one of the following
The final percentages for standard
methods:
Natural (sun-dried) Seedless raisins
• Federal eRulemaking Portal: https://
acquired by handlers during the crop
www.regulations.gov. Follow the
year beginning on August 1, 2005,
instructions for submitting comments.
• E-mail: You may submit comments
which shall be free tonnage and reserve
directly to USCIS by e-mail at
tonnage, respectively, are designated as
rfs.regs@dhs.gov. Include DHS Docket
follows:
No. USCIS–2005–0038 in the subject
Free
Reserve
line of the message.
Varietal type
percentage
percentage
• Mail: The Director, Regulatory
Management Division, U.S. Citizenship
Natural (sunand Immigration Services, Department
Dried) Seedless ................
82.50
17.50 of Homeland Security, 111
Massachusetts Avenue, NW., 3rd Floor,
Washington, DC 20529. To ensure
Dated: May 17, 2006.
proper handling, please reference DHS
Lloyd C. Day,
Docket No. USCIS–2005–0038 on your
Administrator, Agricultural Marketing
correspondence. This mailing address
Service.
may also be used for paper, disk, or CD–
[FR Doc. 06–4747 Filed 5–22–06; 8:45 am]
ROM submissions.
BILLING CODE 3410–02–P
• Hand Delivery/Courier: U.S.
Citizenship and Immigration Services,
Department of Homeland Security, 111
Massachusetts Avenue, NW., 3rd Floor,
DEPARTMENT OF HOMELAND
Washington, DC 20529. Contact
SECURITY
Telephone Number is (202) 272–8377.
U.S. Citizenship and Immigration
FOR FURTHER INFORMATION CONTACT:
Services
Kristina Carty-Pratt, Adjudications
Officer, Office of Program and
8 CFR Part 103
Regulations Development, U.S.
[DHS Docket No. USCIS–2005–0038; CIS No. Citizenship and Immigration Services,
Department of Homeland Security, 111
2367–05]
Massachusetts Avenue, NW.,
RIN 1615–AB40
Washington, DC 20536. Contact
Telephone Number (202) 272–8400.
Changes to the Procedures for
SUPPLEMENTARY INFORMATION:
Notifying the Public of Premium
Processing Service Designations and
I. Public Participation
Availability
Interested persons are invited to
participate in this rulemaking by
AGENCY: U.S. Citizenship and
submitting written data, views, or
Immigration Services, DHS.
arguments on all aspects of the interim
ACTION: Interim rule with request for
rule. Comments that will provide the
comments.
most assistance to U.S. Citizenship and
PO 00000
Frm 00007
Fmt 4700
Sfmt 4700
E:\FR\FM\23MYR1.SGM
23MYR1
]]>Agencies
[Federal Register Volume 71, Number 99 (Tuesday, May 23, 2006)]
[Rules and Regulations]
[Pages 29567-29571]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 06-4747]
-----------------------------------------------------------------------
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 989
[Docket No. FV06-989-2 IFR]
Raisins Produced From Grapes Grown in California; Final Free and
Reserve Percentages for 2005-06 Crop Natural (Sun-Dried) Seedless
Raisins
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Interim final rule with request for comments.
-----------------------------------------------------------------------
SUMMARY: This rule establishes final volume regulation percentages for
2005-06 crop Natural (sun-dried) Seedless (NS) raisins covered under
the Federal marketing order for California raisins (order). The order
regulates the handling of raisins produced from grapes grown in
California and is locally administered by the Raisin Administrative
Committee (Committee). The volume regulation percentages are 82.50
percent free and 17.50 percent reserve. The percentages are intended to
help stabilize raisin supplies and prices, and strengthen market
conditions.
DATES: Effective August 1, 2005, through July 31, 2006. The volume
regulation percentages apply to acquisitions of NS raisins from the
2005-06 crop until the reserve raisins from that crop are disposed of
under the marketing order. Comments received by July 24, 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; or 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: Kurt Kimmel, Officer-in-Charge, or
Rose M. Aguayo, Marketing Specialist, California Marketing Field
Office, Marketing Order Administration Branch, Fruit and Vegetable
Programs, AMS, USDA; Telephone: (559) 487-5901; Fax: (559) 487-5906.
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
Agreement and Order No. 989 (7 CFR part 989), both as amended,
regulating the handling of raisins produced from grapes grown in
California, hereinafter referred to as the ``order.'' The order is
effective under the Agricultural Marketing Agreement Act of 1937, as
amended (7 U.S.C. 601-674), hereinafter referred to as the ``Act.''
The Department of Agriculture (USDA) is issuing this rule in
conformance with Executive Order 12866.
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. Under the order provisions now in effect, final free
and reserve percentages may be established for raisins acquired by
handlers during the crop year. This rule establishes final free and
reserve percentages for NS raisins for the 2005-06 crop year, which
began August 1, 2005, and ends July 31, 2006. This rule will not
preempt any State or local laws, regulations, or policies, unless they
present an irreconcilable conflict with this rule.
The Act provides that administrative proceedings must be exhausted
before parties may file suit in court. Under section 608c(15)(A) of the
Act, any handler subject to an order may file with USDA a petition
stating that the order, any provision of the order, or any obligation
imposed in connection with the order is not in accordance with law and
request a modification of the order or to be exempted therefrom. A
handler is afforded the opportunity for a hearing on the petition.
After the hearing USDA would rule on the petition. The Act provides
that the district court of the United States in any district in which
the handler is an inhabitant, or has his or her principal place of
business, has jurisdiction to review USDA's ruling on the petition,
provided an action is filed not later than 20 days after the date of
the entry of the ruling.
This rule establishes final volume regulation percentages for 2005-
06 crop NS raisins covered under the order. The volume regulation
percentages are 82.50 percent free and 17.50 percent reserve. Free
tonnage raisins may be sold by handlers to any market. Reserve raisins
must be held in a pool for the account of the Committee and are
disposed of through various programs authorized under the order. For
example, reserve raisins may be sold by the Committee to handlers for
free use or to replace part of the free tonnage raisins they exported;
used in diversion programs; carried over as a hedge against a short
crop; or disposed of in other outlets not competitive with those for
free tonnage raisins, such as government purchase, distilleries, or
animal feed.
The volume regulation percentages are intended to help stabilize
raisin supplies and prices, and strengthen market conditions. The
Committee unanimously recommended final percentages on January 26,
2006, and further justified their recommendation on March 16, 2006.
Computation of Trade Demands
Section 989.54 of the order prescribes procedures and time frames
to be followed in establishing volume regulation. This includes
methodology used to calculate percentages. Pursuant to Sec. 989.54(a)
of the order, the Committee met on August 15, 2005, to review shipment
and inventory data, and other matters relating to the supplies of
raisins of all varietal types. The Committee computed a trade demand
for each varietal type for which a free tonnage percentage might be
recommended. Trade demand is computed using a formula specified in the
order and, for each varietal type, is equal to 90 percent of the prior
year's shipments of free tonnage and reserve tonnage raisins sold for
free use into all market outlets, adjusted by subtracting the carryin
on August 1 of the current crop year, and adding the desirable carryout
at the end of that crop year. As specified in Sec. 989.154(a), the
desirable
[[Page 29568]]
carryout for NS raisins shall equal the total shipments of free tonnage
during August and September for each of the past 5 crop years,
converted to a natural condition basis, dropping the high and low
figures, and dividing the remaining sum by three, or 60,000 natural
condition tons, whichever is higher. For all other varietal types, the
desirable carryout shall equal the total shipments of free tonnage
during August, September and one-half of October for each of the past 5
crop years, converted to a natural condition basis, dropping the high
and low figures, and dividing the remaining sum by three. In accordance
with these provisions, the Committee computed and announced the 2005-06
trade demand for NS raisins at 232,985 tons as shown below.
Computed Trade Demands
[Natural condition tons]
------------------------------------------------------------------------
NS
raisins
------------------------------------------------------------------------
Prior year's shipments....................................... 319,752
Multiplied by 90 percent..................................... 0.90
Equals adjusted base......................................... 287,777
Minus carryin inventory...................................... 114,792
Plus desirable caryout....................................... 60,000
Equals computed NS trade Demand.............................. 232,985
------------------------------------------------------------------------
Computation of Preliminary Volume Regulation Percentages
Section 989.54(b) of the order requires that the Committee
announce, on or before October 5, preliminary crop estimates and
determine whether volume regulation is warranted for the varietal types
for which it computed a trade demand. That section allows the Committee
to extend the October 5 date up to 5 business days if warranted by a
late crop.
The Committee met on October 4, 2005, and announced a preliminary
crop estimate for NS raisins of 266,227 tons, which is about 19 percent
lower than the 10-year average of 328,088 tons. NS raisins are the
major varietal type of California raisin. Adding the carryin inventory
of 114,792 tons, plus the 266,227-ton crop estimate resulted in a total
available supply of 381,019 tons, which was significantly higher (164
percent) than the 232,985-ton trade demand. Thus, the Committee
determined that volume regulation for NS raisins was warranted. The
Committee announced preliminary free and reserve percentages for NS
raisins, which released 85 percent of the computed trade demand since a
minimum field price (price paid by handlers to producers for their free
tonnage raisins) had been established. The preliminary percentages were
74 percent free and 26 percent reserve.
In addition, preliminary percentages were also announced for Dipped
Seedless, Golden Seedless, Zante Currant, and Other Seedless raisins.
It was ultimately determined that volume regulation was only warranted
for NS raisins. As in past seasons, the Committee submitted its
marketing policy to USDA for review.
Computation of Final Volume Regulation Percentages
Pursuant to Sec. 989.54(c), at its January 26, 2006, meeting, the
Committee announced interim percentages for NS raisins to release
slightly less than the full trade demand. Based on a revised NS crop
estimate of 283,000 tons (up from the October estimate of 266,227
tons), interim percentages for NS raisins were announced at 82.25
percent free and 17.75 percent reserve.
Pursuant to Sec. 989.54(d), the Committee also recommended final
percentages at its January 26, 2006, meeting to release the full trade
demands for NS raisins. Final percentages were recommended at 82.50
percent free and 17.50 percent reserve. The Committee's calculations
and determinations to arrive at final percentages for NS raisins are
shown in the table below:
Final Volume Regulation Percentages
[Natural condition tons]
------------------------------------------------------------------------
NS
raisins
------------------------------------------------------------------------
Trade demand................................................. 232,985
Divided by crop estimate..................................... 283,000
Equals the free percentage................................... 82.30
100 minus free percentage equals the reserve percentage...... 17.70
------------------------------------------------------------------------
* * * The Committee recommended rounding the free percentage to
82.50 percent and reducing the reserve percentage to 17.50 percent to
compensate for the higher than normal processing shrinkage being
experienced by handlers with the 2006 NS crop.
By the week ending February 11, 2006, data showed that deliveries
of NS raisins exceeded the Committee's crop estimate of 283,000 tons.
By that date, deliveries of NS raisins totaled 285,052 tons. Thus, at
USDA's request, the RAC met again on March 16, 2006, and reviewed the
current available data and the computations used in arriving at the
recommended final percentages.
At the March meeting, the Committee continued to support a crop
estimate of 283,000 tons, because of the higher than normal processing
shrinkage being experienced with the 2005 NS raisin crop. With a lower
crop estimate, more free tonnage raisins will be made available to
handlers for free tonnage use, but due to the above normal processing
shrinkage, the Committee expects supplies to be in balance with market
needs.
By the week ending April 5, 2006, data showed that deliveries of NS
raisins were at 301,019 tons of NS raisins. Thus, it is likely that
final deliveries may reach 311,493 tons by July 31, 2006--the end of
the crop year. The Committee's recommendation will provide handlers
with 7.5 percent more raisins than would be provided if a 311,493 ton
estimate had been used, but the additional tonnage is not expected to
cause disorderly marketing conditions.
In addition, USDA's ``Guidelines for Fruit, Vegetable, and
Specialty Crop Marketing Orders'' (Guidelines) specify that 110 percent
of recent years' sales should be made available to primary markets each
season for marketing orders utilizing reserve pool authority. This goal
will be met for NS raisins by the establishment of final percentages,
which release 100 percent of the trade demand and the offer of
additional reserve raisins for sale to handlers under the ``10 plus 10
offers.'' As specified in Sec. 989.54(g), the 10 plus 10 offers are
two offers of reserve pool raisins which are made available to handlers
during each season. For each such offer, a quantity of reserve raisins
equal to 10 percent of the prior year's shipments is made available for
free use. Handlers may sell their 10 plus 10 raisins to any market.
For NS raisins, the first 10 plus 10 offer was made in February
2006. A total of 31,975 tons was made available to raisin handlers; all
of the raisins were purchased. The second 10 plus 10 offer of 31,975
tons will be made available to handlers by July 31, 2006. Adding the
total figure of 63,950 tons of 10 plus 10 raisins to the 232,985 ton
trade demand figure, plus 114,792 tons of 2004-05 carryin NS inventory
equates to 411,727 tons of natural condition raisins, or 386,855 tons
of packed raisins, that are available to handlers for free use or
primary markets. This is about 130 percent of the quantity of NS
raisins shipped during the 2004-05 crop year (317,998 natural condition
tons or 300,435 packed tons).
In addition to the 10 plus 10 offers, Sec. 989.67(j) of the order
provides authority for sales of reserve raisins to handlers under
certain conditions such as a national emergency, crop failure, change
in economic or marketing conditions, or if free tonnage shipments
[[Page 29569]]
in the current crop year exceed shipments of a comparable period of the
prior crop year. Such reserve raisins may be sold by handlers to any
market. When implemented, the additional offers of reserve raisins make
even more raisins available to primary markets, which is consistent
with USDA's Guidelines.
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 rules issued thereunder, are unique in that
they are brought about through group action of essentially small
entities acting on their own behalf. Thus, both statutes have small
entity orientation and compatibility.
There are approximately 20 handlers of California raisins who are
subject to regulation under the order and approximately 4,500 raisin
producers in the regulated area. Small agricultural firms are defined
by the Small Business Administration (13 CFR 121.201) as those having
annual receipts of less than $6,500,000, and small agricultural
producers are defined as those having annual receipts of less than
$750,000. Eleven of the 20 handlers subject to regulation have annual
sales estimated to be at least $6,500,000, and the remaining 9 handlers
have sales less than $6,500,000. No more than 9 handlers and a majority
of producers of California raisins may be classified as small entities.
Since 1949, the California raisin industry has operated under a
Federal marketing order. The order contains authority to, among other
things, limit the portion of a given year's crop that can be marketed
freely in any outlet by raisin handlers. This volume control mechanism
is used to stabilize supplies and prices and strengthen market
conditions.
Pursuant to Sec. 989.54(d) of the order, this rule establishes
final volume regulation percentages for 2005-06 crop NS raisins. The
volume regulation percentages are 82.50 percent free and 17.50 percent
reserve. Free tonnage raisins may be sold by handlers to any market.
Reserve raisins must be held in a pool for the account of the Committee
and are disposed of through certain programs authorized under the
order.
Volume regulation is warranted this season because the revised crop
estimate of 283,000 tons combined with the carryin inventory of 114,792
tons results in a total available supply of 397,792 tons, which is
about 70 percent higher than the 232,985 ton trade demand.
The current volume regulation procedures have helped the industry
address its marketing problems by keeping supplies in balance with
domestic and export market needs, and strengthening market conditions.
The current volume regulation procedures fully supply the domestic and
export markets, provide for market expansion, and help reduce the
burden of oversupplies in the domestic market.
Raisin grapes are a perennial crop, so production in any year is
dependent upon plantings made in earlier years. The sun-drying method
of producing raisins involves considerable risk because of variable
weather patterns.
Even though the product and the industry are viewed as mature, the
industry has experienced considerable change over the last several
decades. Before the 1975-76 crop year, more than 50 percent of the
raisins were packed and sold directly to consumers. Now, about 65
percent of raisins are sold in bulk. This means that raisins are now
sold to consumers mostly as an ingredient in another product such as
cereal and baked goods. In addition, for a few years in the early
1970's, over 50 percent of the raisin grapes were sold to the wine
market for crushing. Since then, the percent of raisin-variety grapes
sold to the wine industry has decreased.
California's grapes are classified into three groups--table grapes,
wine grapes, and raisin-variety grapes. Raisin-variety grapes are the
most versatile of the three types. They can be marketed as fresh
grapes, crushed for juice in the production of wine or juice
concentrate, or dried into raisins. Annual fluctuations in the fresh
grape, wine, and concentrate markets, as well as weather-related
factors, cause fluctuations in raisin supply. This type of situation
introduces a certain amount of variability into the raisin market.
Although the size of the crop for raisin-variety grapes may be known,
the amount dried for raisins depends on the demand for crushing. This
makes the marketing of raisins a more difficult task. These supply
fluctuations can result in producer price instability and disorderly
market conditions.
Volume regulation is helpful to the raisin industry because it
lessens the impact of such fluctuations and contributes to orderly
marketing. For example, producer prices for NS raisins remained fairly
steady between the 1993-94 through the 1997-98 seasons, although
production varied. As shown in the table below, during those years,
production varied from a low of 272,063 tons in 1996-97 to a high of
387,007 tons in 1993-94.
According to Committee data, the total producer return per ton
during those years, which includes proceeds from both free tonnage plus
reserve pool raisins, has varied from a low of $904.60 in 1993-94 to a
high of $1,049 in 1996-97. Total producer prices for the 1998-99 and
1999-2000 seasons increased significantly due to back-to-back short
crops during those years. Producer prices dropped dramatically for the
2000-01, 2001-02, and 2002-03 crop years due to record-size production,
large carry-in inventories, and stagnant demand. However, the producer
prices increased slightly with a shorter crop in 2003-04 and rebounded
to pre-1998-99 prices during the 2004-05 crop years as noted below:
Natural Seedless Producer Prices
------------------------------------------------------------------------
Deliveries
(natural Producer
Crop year condition prices
tons) (per ton)
------------------------------------------------------------------------
2004-05....................................... 265,262 \2\
$1210.00
2003-04....................................... 296,864 \1\ 567.00
2002-03....................................... 388,010 \1\ 491.20
2001-02....................................... 377,328 650.94
2000-01....................................... 432,616 603.36
1999-2000..................................... 299,910 1,211.25
1998-99....................................... 240,469 \2\
1,290.00
1997-98....................................... 382,448 946.52
1996-97....................................... 272,063 1,049.20
1995-96....................................... 325,911 1,007.19
1994-95....................................... 378,427 928.27
1993-94....................................... 387,007 904.60
------------------------------------------------------------------------
\1\ Return-to-date, reserve pool still open.
\2\ No volume regulation.
There are essentially two broad markets for raisins--domestic and
export. In recent years, both domestic and export shipments have been
increasing. Domestic shipments decreased from a high of 204,805 packed
tons during the 1990-91 crop year to a low of 156,325 packed tons in
1999-2000. Since that time domestic shipments steadily increased from
174,117 packed tons during the 2000-01 crop year to 193,680 packed tons
during the 2004-05 crop year. In addition, exports decreased from
114,576 packed tons in 1991-92 to a low of 91,600 packed tons in the
1999-2000 crop year. In recent years, export shipments have increased
from a low of 101,537 tons during the 2002-03 crop year to 106,755
[[Page 29570]]
tons of raisins during the 2004-05 crop year.
Moreover, the per capita consumption of raisins has declined from
2.09 pounds in 1988 to 1.46 pounds in 2004. This decrease is consistent
with the decrease in the per capita consumption of dried fruits in
general, which is due to the increasing availability of most types of
fresh fruit throughout the year.
While the overall demand for raisins has been increasing (as
reflected in increased in commercial shipments), production has been
decreasing. Deliveries of NS dried raisins from producers to handlers
reached an all-time high of 432,616 tons in the 2000-01 crop year. This
large crop was preceded by two short crop years; deliveries were
240,469 tons in 1998-99 and 299,910 tons in 1999-2000. Deliveries for
the 2000-01 crop year soared to a record level because of increased
bearing acreage and yields. Deliveries for the 2001-02 crop year were
at 377,328 tons, 388,010 tons for the 2002-03 crop year, 296,864 for
the 2003-04 crop year and 265,262 tons for the 2004-05 crop year. After
three crop years of high production and a large 2001-02 carryin
inventory, the industry diverted raisins or removed 41,000 acres in
2001; 27,000 acres in 2002; and 15,000 acres of vines in 2003 to reduce
the industry's burdensome supply of raisins. These actions resulted in
declining deliveries of 296,865 tons for the 2003-04 crop year and
265,262 tons for the 2004-05 crop year.
The order permits the industry to exercise supply control
provisions, which allow for the establishment of free and reserve
percentages, and establishment of a reserve pool. One of the primary
purposes of establishing free and reserve percentages is to equilibrate
supply and demand. If raisin markets are over-supplied with product,
producer prices will decline.
Raisins are generally marketed at relatively lower price levels in
the more elastic export market than in the more inelastic domestic
market. This results in a larger volume of raisins being marketed and
enhances producer returns. In addition, this system allows the U.S.
raisin industry to be more competitive in export markets.
To assess the impact that volume control has on the prices
producers receive for their product, an econometric model has been
constructed. The model developed is for the purpose of estimating
nominal prices under a number of scenarios using the volume control
authority under the Federal marketing order. The price producers
receive for the harvest and delivery of their crop is largely
determined by the level of production and the volume of carryin
inventories. The Federal marketing order permits the industry to
exercise supply control provisions, which allow for the establishment
of reserve and free percentages for primary markets, and a reserve
pool. The establishment of reserve percentages impacts the production
that is marketed in the primary markets.
The reserve percentage limits what handlers can market as free
tonnage. Assuming the 17.50 percent reserve limits the total free
tonnage to 233,475 natural condition tons (.8250 x the 283,000-ton crop
estimate) and carryin is 114,792 natural condition tons, and all of the
63,950 natural condition tons of reserve raisins offered for sale under
the 10 plus 10 offers are purchased, then the total free supply is
estimated at 412,217 natural condition tons. Data available as of April
5, 2006, shows that deliveries of NS raisins are at 301,019 tons. If
the Committee used a 311,493 ton crop estimate, and assuming a 25.2
percent reserve limits the total free tonnage to 232,996 natural
condition tons (.7480 x the 311,493-ton crop estimate) and carryin and
10+10 offers and purchases remained the same, then the total free
supply would be estimated at 411,738 natural condition tons, a
difference of 479 tons. The Committee believes that this additional
tonnage will provide handlers with enough free tonnage to compensate
for the above normal processing shrink being experienced with this
season's crop.
The econometric model estimates prices to be $63 per ton higher
than under an unregulated scenario. This price increase is beneficial
to all producers regardless of size and enhances producers' total
revenues in comparison to no volume control. Establishing a reserve
allows the industry to help stabilize supplies in both domestic and
export markets, while improving returns to producers.
Free and reserve percentages are established by varietal type, and
usually in years when the supply exceeds the trade demand by a large
enough margin that the Committee believes volume regulation is
necessary to maintain market stability. Accordingly, in assessing
whether to apply volume regulation or, as an alternative, not to apply
such regulation, it has been determined that volume regulation is
warranted this season for only one of the nine raisin varietal types
defined under the order.
The free and reserve percentages established by this rule release
the full trade demand and apply uniformly to all handlers in the
industry, regardless of size. For NS raisins, with the exception of the
1998-99 and 2004-05 crop years, small and large raisin producers and
handlers have been operating under volume regulation percentages every
year since 1983-84. There are no known additional costs incurred by
small handlers that are not incurred by large handlers. While the level
of benefits of this rulemaking are difficult to quantify, the
stabilizing effects of the volume regulations impact small and large
handlers positively by helping them maintain and expand markets even
though raisin supplies fluctuate widely from season to season.
Likewise, price stability positively impacts small and large producers
by allowing them to better anticipate the revenues their raisins will
generate.
There are some reporting, recordkeeping and other compliance
requirements under the order. The reporting and recordkeeping burdens
are necessary for compliance purposes and for developing statistical
data for maintenance of the program. The requirements are the same as
those applied in past seasons. Thus, this action imposes no additional
reporting or recordkeeping requirements on either small or large raisin
handlers. The forms require information which is readily available from
handler records and which can be provided without data processing
equipment or trained statistical staff. The information collection and
recordkeeping requirements have been previously approved by the Office
of Management and Budget (OMB) under OMB Control No. 0581-0178. As with
all Federal marketing order programs, reports and forms are
periodically reviewed to reduce information requirements and
duplication by industry and public sector agencies.
AMS is committed to compliance with the Government Paperwork
Elimination Act (GPEA), which requires Government agencies in general
to provide the public the option of submitting information or
transacting business electronically to the maximum extent possible.
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 raisin industry and all interested persons were invited to attend
the meetings and participate in the Committee's deliberations. Like all
Committee meetings, the August 15, 2005, October 4, 2005, January 26,
2006, and March 16, 2006, meetings were public meetings and all
entities, both
[[Page 29571]]
large and small, were able to express their views on this issue.
Also, the Committee has a number of appointed subcommittees to
review certain issues and make recommendations to the Committee. The
Committee's Reserve Sales and Marketing Subcommittee met on August 15,
2005, October 4, 2005, January 26, 2006, and March 16, 2006, and
discussed these issues in detail. Those meetings were also public
meetings and both large and small entities were able to participate and
express their views. 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 the establishment of final volume
regulation percentages for 2005-06 crop NS raisins covered under the
order. Any comments received will be considered prior to finalization
of this rule.
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.
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) The relevant provisions of this part require that
the percentages designated herein for the 2005-06 crop year apply to
all NS raisins acquired from the beginning of that crop year; (2)
handlers are currently marketing their 2005-06 crop NS raisins and this
action should be taken promptly to achieve the intended purpose of
making the full trade demand available to handlers; (3) handlers are
aware of this action, which was unanimously recommended at a public
meeting, and need no additional time to comply with these percentages;
and (4) this interim final rule provides a 60-day comment period, and
all comments timely received will be considered prior to finalization
of this rule.
List of Subjects in 7 CFR Part 989
Grapes, Marketing agreements, Raisins, Reporting and recordkeeping
requirements.
0
For the reasons set forth in the preamble, 7 CFR part 989 is amended to
read as follows:
PART 989--RAISINS PRODUCED FROM GRAPES GROWN IN CALIFORNIA
0
1. The authority citation for 7 CFR part 989 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. Section 989.258 is added to Subpart--Supplementary Regulations to
read as follows:
Note: This section will not appear in the annual Code of Federal
Regulations.
Sec. 989.258 Final free and reserve percentages for the 2005-06 crop
year.
The final percentages for standard Natural (sun-dried) Seedless
raisins acquired by handlers during the crop year beginning on August
1, 2005, which shall be free tonnage and reserve tonnage, respectively,
are designated as follows:
------------------------------------------------------------------------
Free Reserve
Varietal type percentage percentage
------------------------------------------------------------------------
Natural (sun-Dried) Seedless.................. 82.50 17.50
------------------------------------------------------------------------
Dated: May 17, 2006.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. 06-4747 Filed 5-22-06; 8:45 am]
BILLING CODE 3410-02-P
