[Federal Register Volume 83, Number 1 (Tuesday, January 2, 2018)]
[Proposed Rules]
[Pages 72-77]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-28169]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 83, No. 1 / Tuesday, January 2, 2018 /
Proposed Rules
[[Page 72]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 929
[Doc. No. AMS-SC-17-0061; SC17-929-2 PR]
Cranberries Grown in States of Massachusetts, et al.; Free and
Restricted Percentages for the 2017-18 Crop Year for Cranberries
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This proposed rule invites comments on a recommendation to
establish free and restricted percentages for the 2017-18 crop year
under the marketing order for cranberries grown in the production area
(Order). This action would establish the proportion of cranberries from
the 2017-18 crop which may be handled and allow for the disposal of
2017-18 processed cranberry products. It would also establish a minimum
quantity exemption and an exemption for handlers with no carryover
inventory, exempt organically grown cranberries, and define outlets for
restricted fruit. This action would adjust supply to more closely meet
market demand, improve grower and handler returns and reduce inventory.
This proposal also contains a formatting change to subpart references
to bring the language into conformance with the Office of Federal
Register requirements.
DATES: Comments must be received by February 1, 2018.
ADDRESSES: Interested persons are invited to submit written comments
concerning this proposal. Comments must be sent to the Docket Clerk,
Marketing Order and Agreement Division, Specialty Crops Program, AMS,
USDA, 1400 Independence Avenue SW, STOP 0237, Washington, DC 20250-
0237; Fax: (202) 720-8938; or internet: http://www.regulations.gov. All
comments should reference the document 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: http://www.regulations.gov. All
comments submitted in response to this proposal will be included in the
record and will be made available to the public. Please be advised that
the identity of the individuals or entities submitting the comments
will be made public on the internet at the address provided above.
FOR FURTHER INFORMATION CONTACT: Doris Jamieson, Marketing Specialist,
or Christian D. Nissen, Regional Director, Southeast Marketing Field
Office, Marketing Order and Agreement Division, Specialty Crops
Program, AMS, USDA; Telephone: (863) 324-3375, Fax: (863) 291-8614, or
Email: [email protected] or [email protected].
Small businesses may request information on complying with this
regulation by contacting Richard Lower, Marketing Order and Agreement
Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue
SW, STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-2491,
Fax: (202) 720-8938, or Email: [email protected].
SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553,
proposes an amendment to regulations issued to carry out a marketing
order as defined in 7 CFR 900.2(j). This proposal is issued under
Marketing Agreement and Order No. 929, as amended (7 CFR part 929),
regulating the handling of cranberries grown in the states of
Massachusetts, Rhode Island, Connecticut, New Jersey, Wisconsin,
Michigan, Minnesota, Oregon, Washington, and Long Island in the State
of New York. Part 929 (referred to as 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 Cranberry
Marketing Committee (Committee) locally administers the Order and is
comprised of growers and handlers of cranberries operating within the
production area, and a public member.
The Department of Agriculture (USDA) is issuing this proposed rule
in conformance with Executive Orders 13563 and 13175. This action falls
within a category of regulatory actions that the Office of Management
and Budget (OMB) exempted from Executive Order 12866 review.
Additionally, because this proposed rule does not meet the definition
of a significant regulatory action it does not trigger the requirements
contained in Executive Order 13771. See OMB's Memorandum titled
``Interim Guidance Implementing Section 2 of the Executive Order of
January 30, 2017 titled `Reducing Regulation and Controlling Regulatory
Costs' '' (February 2, 2017).
This proposal has been reviewed under Executive Order 12988, Civil
Justice Reform. Order provisions provide that the Committee may
recommend and implement, subject to USDA approval, volume control
regulation which would decrease the available supply of cranberries,
whenever the Secretary finds that ``such regulation will tend to
effectuate the declared policy of the Act.'' Accordingly, this proposed
rule would establish free and restricted percentages for cranberries
for the 2017-18 crop year, beginning September 1, 2017, through August
31, 2018.
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 proposed rule invites comments on the establishment of free
and restricted percentages for the 2017-18 crop year. This proposal
would establish the proportion of cranberries from the 2017-18 crop
that may be handled at 85 percent free and 15 percent restricted. This
action would also allow for the disposal of 2017-18 processed cranberry
products to meet up to 50 percent of a handler's
[[Page 73]]
restriction. It would also establish a minimum quantity exemption,
exempt handlers with no carryout inventory, exempt organically grown
cranberries, and define outlets for restricted fruit. This action would
adjust supply to more closely meet market demand, improve grower
returns, and help reduce inventory.
The Committee met on August 4, 2017, and August 31, 2017, and
recommended establishing these free and restricted percentages for the
2017-18 season, providing handlers with the option to divert processed
cranberry products to meet up to 50 percent of their restricted
percentage, and designating outlets for restricted fruit. The Committee
also recommended establishing a minimum exemption of 125,000 barrels
for each handler. After much consideration, USDA determined the minimum
exemption portion of the recommendation should be revised.
Consequently, this proposal would only exempt small handlers who
process less than 125,000 barrels or handlers who would not have
carryover inventory at the end of the 2017-18 fiscal year from the
restriction. The 125,000 barrel exemption would not apply to handlers
who do not meet these criteria.
Sections 929.52 and 929.54 provide authority to control volume by
designating free and restricted percentages for cranberries acquired by
handlers in a given crop year. Section 929.52 also provides that the
Secretary shall control the handling of cranberries whenever the
Secretary finds, from the recommendations and information submitted by
the committee, or from other such information, that such volume control
will tend to effectuate the declared policy of the Act. Free percentage
volume may be shipped to any market, while restricted percentage volume
must be diverted or used for noncompetitive purposes as prescribed in
Sec. 929.57. Section 929.51 requires the Committee to consider certain
conditions, including supply and demand, prior to recommending a
handler withholding program, and that any recommendation to do so be
made by August 31.
Section 929.58(a) provides the authority to exempt from any or all
requirements the handling of cranberries in such minimum quantities as
the Committee, with the approval of the Secretary, may prescribe.
Section 929.58(b) provides, in part, the authority to exempt from any
or all requirements the handling of cranberries of such forms or types,
including organic cranberries, as the Committee, with the approval of
the Secretary, may prescribe.
Domestic cranberry production has been increasing over the past few
years, up from 8.0 million barrels in 2012 to 9.6 million barrels in
2016. During the last few years, demand has remained relatively flat,
and has not kept pace with the increases in supply. This has led to
increasing levels of inventories. Ending inventory levels have
increased from 5.8 million barrels in 2012 to 9.7 million barrels in
2016.
Demand for cranberries is inelastic, meaning changes in consumer
price have a minimal effect on total sales volume. However, grower
prices are very sensitive to changes in supply. As such, higher
inventory levels place downward pressure on grower prices for
cranberries and reduce grower returns. Data reviewed by the Committee
indicates that the price per barrel received by some growers has fallen
from $30 a barrel in 2011 to $10 a barrel in 2016. With the cost of
production estimated at approximately $35 a barrel, for many growers
returns have fallen below the cost of production.
On August 4, 2017, and again on August 31, 2017, the Committee met
to discuss the levels of supply and demand and how market conditions
were impacting the industry. The Committee discussed the approximate
levels of production for the 2017-18 season, forecasting production at
approximately 9.1 million barrels. Carry-in inventory was estimated at
approximately 9.9 million barrels and foreign acquired cranberries are
expected to provide an additional 2.1 million barrels, for a total
available supply of approximately 21.1 million barrels for the year.
After accounting for shrinkage, the Committee agreed on an adjusted
supply of 20.4 million barrels for the 2017-18 season.
The Committee also reviewed anticipated sales for the upcoming
season. Sales for fresh fruit were estimated at 333,000 barrels and
processed fruit sales were estimated at 9.2 million barrels. Based on
these expectations, inventory at the end of the 2017-18 crop year is
anticipated to be roughly 10.9 million barrels, a 10 percent increase
from the previous year. Using these numbers, end of year inventories
would be approximately 115 percent of average annual sales.
After calculating the anticipated level of surplus for the 2017-18
season, the Committee agreed the industry is faced with a large
inventory that continues to build. In its discussions of how to address
this issue, the Committee considered several options. During the
discussion of regulating the volume for the 2017-18 season, some
members preferred establishing a producer allotment for the 2018-19
season over implementing a handler withholding for the current season.
However, other members stated that if no action was taken to control
supply for the 2017-18 season, another million barrels of cranberries
would be added to the surplus inventory. In addition, not regulating
the 2017-18 crop would require greater levels of restriction on the
2018-19 crop, and grower returns may decline further.
The Committee discussed various levels of restriction, being
sensitive to the impact volume control could have on small handlers.
Some small handlers are able to sell all their production each year and
do not maintain an inventory. Several Committee members stated a large
restriction would place a hardship on these small handlers. The
Committee also recognized a small restriction would not immediately
balance supply with demand. However, even a small restriction would
remove a portion of the volume from the market and help prevent an
additional increase in inventory. Therefore, based on these
discussions, the Committee recommended establishing free and restricted
percentages at 85 percent free and 15 percent restricted.
The Committee also recommended an allowance for the diversion of
2017-18 processed cranberry products to meet up to 50 percent of a
handler's restriction. The Committee made this recommendation
recognizing that processing fresh fruit to produce one of its top-
selling items, sweetened dried cranberries, results in juice
concentrate as a by-product. A significant amount of current carry-in
inventory is in the form of juice concentrate. By allowing for the
diversion of processed cranberry products, such as juice concentrate,
to meet a portion of a handler's restriction, the Committee believes
this would help prevent additional build-up of carry-in inventory. The
ability to use cranberry processed products in addition to fresh
berries to meet diversion requirements may also help handlers who find
they need to divert additional volume late in the year when the
availability of fresh berries may be limited.
To ensure the disposal of processed products in lieu of fresh
berries are correctly accounted for under the restriction, the
Committee also recommended including a conversion table, Table 1, in
the regulations. The table recognizes different conversion
equivalencies of berries to processed product based on the volume of
Brix concentrate.
Brix is the method for measuring the amount of sugar contained in
the cranberry products, and the industry average is 50 Brix. The
Committee
[[Page 74]]
acknowledged that the Brix level can vary depending on the growing
region and farming practices. This table would assist in ensuring that
the disposal of processed product in lieu of fresh berries would be
applied equitably among all handlers.
Table 1--Conversion Table
----------------------------------------------------------------------------------------------------------------
Region Brix average Concentrate yield for one barrel of cranberries
----------------------------------------------------------------------------------------------------------------
Oregon................................. 9.8 1.91 gallons 50 Brix concentrate.
Washington............................. 9.3 1.81 gallons 50 Brix concentrate.
New Jersey............................. 8.8 1.72 gallons 50 Brix concentrate.
Wisconsin.............................. 8.7 1.70 gallons 50 Brix concentrate.
Massachusetts.......................... 8.4 1.64 gallons 50 Brix concentrate.
All others............................. 8.7 1.70 gallons 50 Brix concentrate.
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For example, using the conversion table above, handlers could
determine the amount of cranberry concentrate they would need to
divert, in lieu of fresh berries, to cover any restricted percentage.
Juice concentrate should comprise the vast majority of processed
product used for diversion. Should requests be made to use other
processed products for diversion, conversion rates for those products
would be provided by the Committee based on information provided by the
requesting handler. The means for approving and appealing the
conversion rates would be provided in a separate rulemaking action.
For example, a handler covered under the restriction whose acquired
volume is 1,000,000 barrels would have 1,000,000 barrels in regulated
volume with 850,000 barrels of free use cranberries (1,000,000 x .85)
and 150,000 barrels of restricted use cranberries (1,000,000 x .15) for
the 2017-18 season. Under this proposed rule, the handler could divert
fresh fruit to outlets for restricted cranberries as prescribed in the
Order, or divert up to 50 percent of the restriction, or a 75,000
barrel equivalent (150,000 barrels / 2) in processed products from the
2017-18 harvest, with the remaining amount fulfilled using fresh
berries. For cranberries produced in Wisconsin, this would equate to
127,500 gallons of concentrate (75,000 barrels x 1.7 gallons) that
would need to be diverted to outlets for restricted cranberries.
Section 929.57 states that cranberries withheld from handling may
only be diverted through such outlets as the Committee, with the
approval of the Secretary, finds are noncompetitive to outlets for
unrestricted (free percentage) cranberries. The Committee discussed
various outlets and recommended the following: Foreign countries,
except Canada; charitable institutions; any nonhuman food use; and,
research and development projects approved by the Committee dealing
with the development of foreign and domestic markets, including, but
not limited to dehydration, radiation, freeze drying, or freezing of
cranberries as outlets for withheld cranberries. They further
recommended that cranberries may not be converted into canned, frozen,
or dehydrated cranberries or other cranberry products by any commercial
process prior to diversion to foreign countries. These outlets for
restricted cranberries would be added to the rules and regulations
under the Order by creating a new Sec. 929.108.
The Committee also recommended organically grown cranberries be
exempt from this proposed regulation as they serve a niche market and
represent a very small portion of the total crop. All other cranberry
production, including fresh cranberries, would be subject to regulation
under the handler withhold volume regulation.
To address the burden the volume regulation would have on small
handlers, the Committee also recommended providing a minimum quantity
exemption of 125,000 barrels. Under the Committee's recommendation, the
exemption would be given to handlers of record for the 2016-17
(previous) crop year and the 125,000 barrels would be subtracted from
the handler's 2017-18 acquired volume before the restricted percentage
would be applied. Small handlers whose acquired volume is 125,000
barrels or less would be exempt from the volume regulation, and
handlers with slightly larger volumes would face minimal restrictions.
After much consideration, USDA determined the minimum exemption
recommendation should be revised under this proposal. Rather than
provide an exemption of 125,000 barrels for each handler, this action
would exempt small handlers who process less than 125,000 barrels from
the 15 percent restriction. Further, only handlers who would have
carryover inventory that is not sold or under contract at the end of
the 2017-18 fiscal year would be subject to the 15 percent restriction.
These changes would reflect the Committee's goal of reducing the burden
on small handlers, and would allow handlers that have matched their
production with market demand to continue to serve their customer base
and protect their market share. Handlers subject to the restriction
should be able to meet any market shortfalls by utilizing cranberries
or cranberry products they have in inventory.
With this change, only those handlers carrying inventory would be
subject to the restriction. In reviewing the Committee's recommendation
and other available industry information, it is the existing
inventories in excess of 9 million barrels that is putting the most
downward pressure on returns to both grower and handler. Consequently,
this change would put more focus on reducing the volume in inventory.
Accordingly, this proposal would establish free and restricted
percentages of 85 percent and 15 percent, respectively, for the 2017-18
season, provide handlers with the option to divert processed cranberry
products to meet up to 50 percent of their restricted percentage, and
define outlets for restricted fruit. The Committee recommended these
actions in a vote of 11 in favor and 2 opposed. This rule would also
would exempt small handlers who process less than 125,000 barrels from
the restriction, as well as handlers with no carryout inventory.
One member who opposed the Committee's recommendations stated the
regulation would cause a hardship on small handlers, as many are able
to sell all of their production each season and do not maintain an
inventory. He further stated that the small handlers did not create the
problem and should not be a part of the solution. However, this issue
is addressed by providing the minimum exemption of 125,000 barrels of
cranberries, which would exempt many small handlers from the regulation
entirely. The other member
[[Page 75]]
who voted against the recommendation opposed volume regulation in
general.
The Committee considered the estimated level of production,
anticipated demand, and determined that without some action on the part
of the Committee, inventory levels would continue to increase
throughout the 2017-18 season. The Committee believes using the volume
control authorities in the Order would help stabilize marketing
conditions for cranberries by helping to adjust supply to meet market
demand and improve grower returns.
The Committee also recommended reporting and recordkeeping
requirements to be used with the volume regulation, as well as
safeguard measures to monitor compliance. These recommendations are
being considered under separate actions.
Initial Regulatory Flexibility Analysis
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA) (5 U.S.C. 601-612), 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
businesses 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.
There are approximately 1,100 cranberry growers in the regulated
area and approximately 65 cranberry handlers subject to regulation
under the Order. Small agricultural producers are defined by the Small
Business Administration (SBA) as those having annual receipts of less
than $750,000, and small agricultural service firms are defined as
those whose annual receipts are less than $7,500,000 (13 CFR 121.201).
According to industry and Committee data, the average grower price
for cranberries during the 2016-17 season was $23.50 per barrel and
total sales were approximately 9.5 million barrels. The value for
cranberries that year totaled $223,250,000 ($23.50 per barrel
multiplied by 9.5 million barrels). Taking the total value of
production for cranberries and dividing it by the total number of
cranberry growers provides an average return per grower of $202,955.
Using the average price and utilization information, and assuming a
normal distribution, the majority of cranberry growers receive less
than $750,000 annually.
According to USDA's Market News report, the average free on board
(f.o.b.) price for cranberries was approximately $30.00 per barrel.
Multiplying the f.o.b. price by total utilization of 9.5 million
barrels results in an estimated handler-level cranberry value of $285
million. Dividing this figure by the number of handlers (65) yields an
estimated average annual handler receipt of $4.3 million, which is
below the SBA threshold for small agricultural service firms.
Therefore, the majority of producers and handlers of cranberries may be
classified as small entities.
While cranberry production has continued to rise, demand has failed
to keep pace, and inventories have been increasing. In an industry such
as cranberries, product can be stored in inventory for long periods of
time. Large inventories are costly to maintain, difficult to market,
and have a price-depressing effect. When supply outpaces demand
resulting in high levels of inventories, grower and handler returns can
be negatively impacted.
Demand for cranberries is inelastic, meaning changes in consumer
price have a minimal effect on total sales. However, grower prices are
very sensitive to changes in supply. With an inelastic demand, even a
small shift in supply can affect grower prices. The Committee's
recommendation to set free and restricted percentages would more
closely align supply with demand. Free percentage cranberries could be
marketed by handlers to any outlet, while restricted percentage volume
could only be used for noncompetitive purposes. Establishing free and
restricted percentages would result in a decrease in supply, as
handlers can only deliver a certain portion of their cranberries into
the competitive marketplace. Therefore, using volume regulation to
reduce supply should increase grower and handler prices and revenues.
This proposal would control the supply of cranberries by
establishing free and restricted percentages at 85 percent free and 15
percent restricted for the 2017-18 crop year. It would also allow for
the diversion of 2017-18 processed cranberry products to meet up to 50
percent of a handler's restriction. In addition, this proposal would
establish a minimum quantity exemption, exempt handlers with no
carryout inventory, exempt organically grown cranberries, and define
outlets for restricted fruit. These actions are designed to help
stabilize marketing conditions, reduce burdensome inventories, and
improve grower and handler returns. This rule would establish new
Sec. Sec. 929.107, 929.108 and 929.252. The authority for these
actions is provided for in Sec. Sec. 929.51, 929.52, 929.54, 929.57,
929.58. These changes are based on Committee recommendations from
meetings on August 4 and August 31, 2017.
While these actions could result in some additional costs to the
industry, the benefits are expected to outweigh them. The purpose of
establishing free and restricted percentages is to address oversupply
conditions and to stabilize grower prices. The industry has a
significant volume in inventory, and this has had a negative impact on
grower and handler returns. Without volume control, inventories would
likely continue to increase, further lowering returns.
Inventories have more than doubled since 2011. In 2011, existing
inventories were around 4.6 million barrels. By the end of the 2016-17
season, inventories are anticipated to be around 9.9 million barrels.
Inventories as a percentage of total sales have also been increasing
from approximately 50 percent in 2010 to approximately 103 percent in
2016, and will reach an anticipated 115 percent after the 2017-18
season if volume control is not implemented. These inventories have had
a depressing effect on grower prices, which for many has fallen below
their cost of production.
Retail demand for cranberries is highly inelastic, which indicates
changes in consumer price do not result in significant changes in the
quantity demanded. Consumer prices largely do not reflect changes in
cranberry supplies. Therefore, this action should have little or no
effect on consumer prices and should not result in a reduction in
retail sales. However, even a small shift in supply could increase
grower and handler returns. The use of free and restricted percentages
would likely have a positive impact on grower and handler returns for
this crop year.
This proposal would result in some fruit being taken off the
market. However, a sufficient amount of fruit would still be available
to supply all aspects of the market. In addition, allowing handlers the
option to divert 2017-18 processed cranberry products to meet up to 50
percent of their restriction would provide handlers some additional
flexibility and may help reduce inventories of juice concentrate, one
of the largest segments of existing inventory.
This action would also exempt small handlers who process less than
125,000
[[Page 76]]
barrels from the restriction. Consequently, small handlers whose
acquired volume is 125,000 barrels or less would be exempt from the
volume restriction, and handlers with slightly larger volumes would
face minimal restrictions. This would reduce the burden the volume
restriction would have on small handlers and their growers.
In addition, only handlers who would have carryover inventory that
is not sold or under contract at the end of the 2017-18 fiscal year
would be subject to the 15 percent restriction. This would allow
handlers that have matched their production with market demand to
continue to serve their customer base and protect their market share.
Handlers subject to the restriction would be able to meet any
shortfalls by utilizing cranberries or cranberry products they have in
inventory.
There are also secondary uses available for restricted fruit,
including foreign markets except Canada, charitable institutions,
nonhuman food use, and research and development projects. While these
alternatives may provide different levels of return than sales to
primary markets, they play an important role for the industry. In
addition, if demand is greater than anticipated, there are significant
amounts of fruit in inventory that could be utilized to meet demand.
As the restriction represents a percentage of a handler's volume,
the costs, when applicable, are proportionate and should not place an
extra burden on small entities as compared to large entities. Likewise,
growers and handlers, regardless of size, would benefit from the
stabilizing effects of this restriction.
One alternative considered was not to impose volume restrictions
during the 2017-18 crop year. However, Committee members believed that
inventory levels were such that some form of volume control was
necessary to help stabilize marketing conditions.
The Committee also considered other levels of free and restricted
percentages. However, some members were concerned that setting a
restriction that was too high could negatively impact small handlers.
The Committee determined that allowing diversion of 50 percent to meet
the restriction allows large handlers to reduce inventory and not add
additional volumes of juice concentrate to the existing inventory
levels. Therefore, for the reasons mentioned above, these alternatives
were rejected by the Committee.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
chapter 35), the Order's information collection requirements have been
previously approved by OMB and assigned OMB No. 0581-0189, Generic
Fruit Crops. The Committee will be recommending reporting and
recordkeeping requirements to be used with the volume restriction, as
well as safeguard measures to monitor compliance, under a separate
rulemaking action.
As with all Federal marketing order programs, reports and forms are
periodically reviewed to reduce information requirements and
duplication by industry and public sector agencies. USDA has not
identified any relevant Federal rules that duplicate, overlap, or
conflict with this proposed rule.
AMS is committed to complying with the E-Government Act to promote
the use of the internet and other information technologies to provide
increased opportunities for citizen access to Government information
and services, and for other purposes.
In addition, the Committee's meetings were widely publicized
throughout the cranberry industry and all interested persons were
invited to attend the meetings and participate in Committee
deliberations on all issues. Like all Committee meetings, the August 4
and August 31, 2017, meetings were public meetings and all entities,
both large and small, were able to express views on these issues.
Finally, interested persons are invited to submit comments on this
proposed rule, including 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/MarketingOrdersSmallBusinessGuide. Any questions
about the compliance guide should be sent to Richard Lower at the
previously-mentioned address in the FOR FURTHER INFORMATION CONTACT
section.
A 30-day comment period is provided to allow interested persons to
respond to this proposal. Thirty days is deemed appropriate since
handlers are already receiving cranberries from the 2017-18 crop and
the proposed handler withholding needs to be applied in order to be
effective. All written comments timely received will be considered
before a final determination is made on this rule.
List of Subjects in 7 CFR Part 929
Cranberries, Marketing agreements, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, 7 CFR part 929 is
proposed to be amended as follows:
PART 929--CRANBERRIES GROWN IN STATES OF MASSACHUSETTS, RHODE
ISLAND, CONNECTICUT, NEW JERSEY, WISCONSIN, MICHIGAN, MINNESOTA,
OREGON, WASHINGTON, AND LONG ISLAND IN THE STATE OF NEW YORK
0
1. The authority citation for part 929 continues to read as follows:
Authority: 7 U.S.C. 601-674.
Subpart Redesignated as Subpart A
0
2. Designate the subpart labeled ``Order Regulating Handling'' as
Subpart A.
Subpart Redesignated as Subpart B and Amended
0
3. Designate the subpart labeled ``Rules and Regulations'' as Subpart B
and revise the heading as shown below:
Subpart B--Administrative Requirements
0
4. Add Sec. 929.107 to read as follows:
Sec. 929.107 Conversion.
During a year of volume regulation, cranberry concentrate and other
processed products made from excess or restricted cranberries harvested
in that year may be diverted according to the provisions of this part.
Any handler disposing of concentrate or other processed products must
report the whole-berry equivalent to the Committee so that all excess
or restricted cranberries are accounted for and reported per rules and
regulations in effect. Table 1-Conversion Table provides a conversion
rate for concentrate to barrels of whole berries based on Brix average
by production region. Should requests be made to use other processed
products for diversion, conversion rates for those products would be
provided by the Committee based on information provided by the
requesting handler.
[[Page 77]]
Table 1 to Sec. 929.107--Conversion Table
----------------------------------------------------------------------------------------------------------------
Region Brix average Concentrate yield for one barrel of cranberries
----------------------------------------------------------------------------------------------------------------
Oregon................................. 9.8 1.91 gallons 50 Brix concentrate.
Washington............................. 9.3 1.81 gallons 50 Brix concentrate.
New Jersey............................. 8.8 1.72 gallons 50 Brix concentrate.
Wisconsin.............................. 8.7 1.70 gallons 50 Brix concentrate.
Massachusetts.......................... 8.4 1.64 gallons 50 Brix concentrate.
All others............................. 8.7 1.70 gallons 50 Brix concentrate.
----------------------------------------------------------------------------------------------------------------
0
5. Add Sec. 929.108 to read as follows:
Sec. 929.108 Outlets for restricted cranberries.
In accordance with Sec. 929.57, restricted cranberries may be
diverted only to the following noncommercial or noncompetitive outlets:
(a) Foreign countries, except Canada, provided that restricted
cranberries diverted under this provision may not be converted into
canned, frozen, or dehydrated cranberries or other cranberry products
by any commercial process, prior to diversion;
(b) Charitable institutions;
(c) Any nonhuman food use, or;
(d) Research and development projects approved by the Committee
dealing with the development of foreign and domestic markets,
including, but not limited to dehydration radiation, freeze drying, or
freezing of cranberries.
Subpart Redesignated as Subpart C
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6. Designate the subpart labeled ``Assessment Rate'' as Subpart C.
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7. Add Sec. 929.252 to read as follows:
Sec. 929.252 Free and restricted percentages for the 2017-18 crop
year.
(a) The percentages for cranberries handled by handlers during the
crop year beginning on September 1, 2017, which shall be free and
restricted, respectively are designated as follows: Free percentage, 85
percent and restricted percentage, 15 percent.
(b) Handlers have the option to process restricted cranberries into
dehydrated cranberries or other processed products. Handlers also have
the option to divert concentrate or other processed products as
provided in Sec. 929.107 to account for up to 50 percent of their
restriction.
(c) Organically grown fruit shall be exempt from the volume
regulation requirements of this section. Small handlers who process
less than 125,000 barrels during the 2017-18 fiscal year are exempt
from the restriction. Any handler who does not have carryover inventory
at the end of the 2017-18 fiscal year would also be exempt.
Dated: December 26, 2017.
Bruce Summers,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 2017-28169 Filed 12-29-17; 8:45 am]
BILLING CODE 3410-02-P