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.

Proposed Rules Federal Register

13502 

Vol. 80, No. 50 

Monday, March 16, 2015 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 985 

[Doc. No. AMS–FV–14–0096; FV15–985–1 

PR] 

Marketing Order Regulating the 

Handling of Spearmint Oil Produced in 

the Far West; Salable Quantities and 

Allotment Percentages for the 2015– 

2016 Marketing Year 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Proposed rule. 

SUMMARY: This proposed rule would 

implement a recommendation from the 

Spearmint Oil Administrative 

Committee (Committee) to establish the 

quantity of spearmint oil produced in 

the Far West, by class, that handlers 

may purchase from, or handle on behalf 

of, producers during the 2015–2016 

marketing year, which begins on June 1, 

2015. The Far West includes the states 

of Washington, Idaho, and Oregon, and 

designated parts of Nevada and Utah. 

This rule invites comments on the 

establishment of salable quantities and 

allotment percentages for Class 1 

(Scotch) spearmint oil of 1,265,853 

pounds and 60 percent, respectively, 

and for Class 3 (Native) spearmint oil of 

1,341,269 pounds and 56 percent, 

respectively. The Committee locally 

administers the marketing order for 

spearmint oil produced in the Far West 

and recommended these quantities to 

help maintain stability in the spearmint 

oil market. 

DATES: Comments must be received by 

March 31, 2015. 

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, Fruit and Vegetable 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: 

Barry Broadbent, Marketing Specialist, 

or Gary Olson, Regional Director, 

Northwest Marketing Field Office, 

Marketing Order and Agreement 

Division, Fruit and Vegetable Program, 

AMS, USDA; Telephone: (503) 326– 

2724, Fax: (503) 326–7440, or Email: 

Barry.Broadbent@ams.usda.gov or 

GaryD.Olson@ams.usda.gov. 

Small businesses may request 

information on complying with this 

regulation by contacting Jeffrey Smutny, 

Marketing Order and Agreement 

Division, Fruit and Vegetable Program, 

AMS, USDA, 1400 Independence 

Avenue SW., STOP 0237, Washington, 

DC 20250–0237; Telephone: (202) 720– 

2491, Fax: (202) 720–8938, or Email: 

Jeffrey.Smutny@ams.usda.gov. 

SUPPLEMENTARY INFORMATION: This 

proposal is issued under Marketing 

Order No. 985 (7 CFR part 985), as 

amended, regulating the handling of 

spearmint oil produced in the Far West 

(Washington, Idaho, Oregon, and 

designated parts of Nevada and Utah), 

hereinafter referred to as the ‘‘order.’’ 

The order is effective under the 

Agricultural Marketing Agreement Act 

of 1937, as amended (7 U.S.C. 601–674), 

hereinafter referred to as the ‘‘Act.’’ 

The Department of Agriculture 

(USDA) is issuing this proposed rule in 

conformance with Executive Orders 

12866, 13175, and 13563. 

This proposed rule has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. This proposed rule is 

not intended to have retroactive effect. 

Under the order now in effect, salable 

quantities and allotment percentages 

may be established for classes of 

spearmint oil produced in the Far West. 

This proposed rule would establish the 

quantity of spearmint oil produced in 

the Far West, by class, which handlers 

may purchase from, or handle on behalf 

of, producers during the 2015–2016 

marketing year, which begins on June 1, 

2015. 

The Act provides that administrative 

proceedings must be exhausted before 

parties may file suit in court. Under 

section 608c(15)(A) of the Act, any 

handler subject to an order may file 

with USDA a petition stating that the 

order, any provision of the order, or any 

obligation imposed in connection with 

the order is not in accordance with law 

and request a modification of the order 

or to be exempted therefrom. A handler 

is afforded the opportunity for a hearing 

on the petition. After the hearing, USDA 

would rule on the petition. The Act 

provides that the district court of the 

United States in any district in which 

the handler is an inhabitant, or has his 

or her principal place of business, has 

jurisdiction to review USDA’s ruling on 

the petition, provided an action is filed 

not later than 20 days after the date of 

the entry of the ruling. 

The Committee meets annually in the 

fall to adopt a marketing policy for the 

ensuing marketing year or years. In 

determining such marketing policy, the 

Committee considers a number of 

factors, including, but not limited to, the 

current and projected supply, estimated 

future demand, production costs, and 

producer prices for all classes of 

spearmint oil. Input from spearmint oil 

handlers and producers regarding 

prospective marketing conditions for the 

upcoming year is considered as well. If 

the Committee’s marketing policy 

considerations indicate a need for 

limiting the quantity of any or all 

classes of spearmint oil marketed, the 

Committee subsequently recommends to 

USDA the establishment of a salable 

quantity and allotment percentage for 

such class or classes of oil for the 

forthcoming marketing year. 

Recommendations for volume control 

are intended to ensure that market 

requirements for Far West spearmint oil 

are satisfied and orderly marketing 

conditions are maintained. 

The salable quantity represents the 

total amount of each class of spearmint 

oil that handlers may purchase from, or 

handle on behalf of, producers during 

the marketing year. The allotment 

percentage is the percentage used to 

calculate each producer’s prorated share 

of the salable quantity. It is derived by 


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dividing the salable quantity for each 

class of spearmint oil by the total of all 

producers’ allotment bases for the same 

class of oil. Each producer’s annual 

allotment of salable spearmint oil is 

calculated by multiplying their 

respective total allotment base by the 

allotment percentage for each class of 

spearmint oil. A producer’s allotment 

base is their quantified share of the 

spearmint oil market based on a 

statistical representation of past 

spearmint oil production, with 

accommodation for reasonable and 

normal adjustments to such base as 

prescribed by the Committee and 

approved by USDA. 

Salable quantities and allotment 

percentages are established at levels 

intended to fulfill market requirements 

and to maintain orderly marketing 

conditions. Committee 

recommendations for volume controls 

are made well in advance of the period 

in which the regulations are to be 

effective, thereby allowing producers 

the chance to adjust their production 

decisions accordingly. 

Pursuant to authority in §§ 985.50, 

985.51, and 985.52 of the order, the full 

eight-member Committee met on 

November 5, 2014, and recommended 

salable quantities and allotment 

percentages for both classes of oil for the 

2015–2016 marketing year. The 

Committee unanimously recommended 

the establishment of a salable quantity 

and allotment percentage for Class 1 

(Scotch) spearmint oil of 1,265,853 

pounds and 60 percent, respectively. 

The Committee, also with a unanimous 

vote, recommended the establishment of 

a salable quantity and allotment 

percentage for Class 3 (Native) 

spearmint oil of 1,341,269 pounds and 

56 percent, respectively. 

This action would set the amount of 

Scotch and Native spearmint oil that 

handlers may purchase from, or handle 

on behalf of, producers during the 

2015–2016 marketing year, which 

begins on June 1, 2015. Salable 

quantities and allotment percentages 

have been placed into effect each season 

since the order’s inception in 1980. 

Class 1 (Scotch) Spearmint Oil 

As noted above, the Committee 

unanimously recommended a salable 

quantity of Scotch spearmint oil of 

1,265,853 pounds and an allotment 

percentage of 60 percent for the 

upcoming 2015–2016 marketing year. 

The Committee utilized 2015–2016 sales 

estimates for Scotch spearmint oil, as 

provided by several of the industry’s 

handlers, as well as historical and 

current Scotch spearmint oil production 

and inventory statistics, to arrive at 

these recommendations. 

Trade demand for Far West Scotch 

spearmint oil is expected to rise from 

1,092,726 pounds in the 2014–2015 

marketing year to 1,100,000 pounds in 

2015–2016. Industry reports indicate 

that the increased trade demand 

estimate is the result of increased 

consumer demand for mint flavored 

products and low end-user inventories 

that need to be replenished. Information 

gathered from spearmint oil handlers 

supports this conclusion. 

Production of Far West Scotch 

spearmint oil increased from 1,057,377 

pounds in 2013 to 1,093,740 pounds in 

2014. Committee members attribute the 

increase in production to both the low 

level of reserves and growing demand. 

Given that these factors are expected to 

continue in the coming 2015–2016 year, 

the Committee expects production to 

increase to as much as 1,300,000 

pounds for the forthcoming marketing 

year. 

The Committee also estimates that 

there will be zero carry-in of Scotch 

spearmint oil on June 1, 2015, the 

beginning of the 2015–2016 marketing 

year. This figure, which is the primary 

measure of excess supply, is down from 

7,064 carried-in the previous year. This 

level of carry-in is below the minimum 

carry-in quantity that the Committee 

considers favorable. The demand for 

Scotch spearmint oil during the 

remainder of the 2014–2015 marketing 

year is expected to equal or exceed the 

remaining total supply, which will 

likely cause the zero carry-in. 

The 2015–2016 salable quantity of 

1,265,853 pounds recommended by the 

Committee represents an increase of 

173,127 pounds over the total supply 

available during the previous marketing 

year. Total supply for 2014–2015 

amounted to 1,092,726 pounds (7,064 

carry-in, 989,643 pounds produced, and 

96,019 pounds released from the 

reserve). 

The Committee estimates 2015–2016 

demand for Scotch spearmint oil at 

1,100,000 pounds. When considered in 

conjunction with the forecast that there 

will be zero available carry-in of Scotch 

spearmint oil on June 1, 2015, the 

recommended salable quantity of 

1,265,853 pounds would satisfy market 

demand and yield a carry-in of 165,853 

pounds available at the beginning of 

2016–2017 marketing year. 

The Committee’s stated intent in the 

use of marketing order volume control 

regulations for Scotch spearmint oil is to 

keep adequate supplies available to 

meet market needs and maintain orderly 

marketing conditions. The salable 

quantity recommended for the 

upcoming marketing year is more than 

the salable quantity initially set for the 

previous year of 1,149,030. The 

Committee believes that the 

recommended salable quantity would 

adequately meet demand, as well as 

result in a larger carry-in for the 

following year. With that in mind, the 

Committee developed its 

recommendation for the proposed 

Scotch spearmint oil salable quantity 

and allotment percentage for the 2015– 

2016 marketing year based on the 

information discussed above, as well as 

the data outlined below. 

(A) Estimated carry-in of Scotch 

spearmint oil on June 1, 2015—0 

pounds. This figure is the difference 

between the revised 2014–2015 

marketing year total available supply of 

1,092,726 pounds and the estimated 

2014–2015 marketing year trade 

demand of 1,092,726 pounds. 

(B) Estimated trade demand of Scotch 

spearmint oil for the 2015–2016 

marketing year—1,100,000 pounds. This 

figure is based on input from producers 

at five Scotch spearmint oil production 

area meetings held in late September 

and early October 2014, as well as 

estimates provided by handlers and 

other meeting participants at the 

November 5, 2014, meeting. The average 

estimated trade demand derived from 

the five production area meetings was 

1,192,400 pounds, which is 42,400 

pounds more than the average of trade 

demand estimates submitted by 

handlers. Far West Scotch spearmint oil 

sales have averaged 979,520 pounds per 

year over the last three years. Given this 

information, the Committee decided it 

was prudent to anticipate the trade 

demand at 1,100,000 pounds. Should 

the initially established volume control 

levels prove insufficient to adequately 

supply the market, the Committee has 

the authority to recommend intraseasonal increases as needed. 

(C) Salable quantity of Scotch 

spearmint oil required from the 2015– 

2016 marketing year production— 

1,100,000 pounds. This figure is the 

difference between the estimated 2015– 

2016 marketing year trade demand 

(1,100,000 pounds) and the estimated 

carry-in on June 1, 2015 (0 pounds). 

This figure represents the minimum 

salable quantity that may be needed to 

satisfy estimated demand for the coming 

year with no carryover. 

(D) Total estimated allotment base of 

Scotch spearmint oil for the 2015–2016 

marketing year—2,109,755 pounds. This 

figure represents a one-percent increase 

over the revised 2014–2015 total 

allotment base. This figure is generally 

revised each year on June 1 due to 

producer base being lost because of the 


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bona fide effort production provisions of 

§ 985.53(e). The revision is usually 

minimal. 

(E) Computed Scotch spearmint oil 

2015–2016 marketing year allotment 

percentage—52.1 percent. This 

percentage is computed by dividing the 

minimum required salable quantity 

(1,100,000 pounds) by the total 

estimated allotment base (2,109,755 

pounds). 

(F) Recommended Scotch spearmint 

oil 2015–2016 marketing year allotment 

percentage—60 percent. This is the 

Committee’s recommendation and is 

based on the computed allotment 

percentage (52.1 percent), the average of 

the computed allotment percentage 

figures from the five production area 

meetings (56.5 percent), and input from 

producers and handlers at the 

November 5, 2014, meeting. The 

recommended 60 percent allotment 

percentage is also based on the 

Committee’s belief that the computed 

percentage (52.1 percent) may not 

adequately supply the potential 2015– 

2016 Scotch spearmint oil market. 

(G) Recommended Scotch spearmint 

oil 2015–2016 marketing year salable 

quantity—1,265,853 pounds. This figure 

is the product of the recommended 

allotment percentage (60 percent) and 

the total estimated allotment base 

(2,109,755 pounds). 

(H) Estimated total available supply 

of Scotch spearmint oil for the 2015– 

2016 marketing year—1,265,853 

pounds. This figure is the sum of the 

2015–2016 recommended salable 

quantity (1,265,853 pounds) and the 

estimated carry-in on June 1, 2015 (0 

pounds). 

Class 3 (Native) Spearmint Oil 

At the November 5, 2014, meeting, the 

Committee also recommended a 2015– 

2016 Native spearmint oil salable 

quantity of 1,341,269 pounds and an 

allotment percentage of 56 percent. The 

Committee utilized Native spearmint oil 

sales estimates for 2015–2016 marketing 

year, as provided by several of the 

industry’s handlers, as well as historical 

and current Native spearmint oil market 

statistics to establish these thresholds. 

The recommended volume control 

levels represent an increase of 250,448 

pounds and 10 percentage points over 

the previous year’s initially established 

salable quantity and allotment 

percentage. 

The Committee also estimates that 

there will be 512,745 pounds of Native 

spearmint oil in the reserve pool on 

June 1, 2015. This figure, which is the 

oil held in reserve by producers, is 

down from an industry peak of 606,942 

pounds in 2011. Reserve levels of Native 

spearmint oil are nearing the level that 

the Committee believes is optimal for 

the industry. 

Committee statistics indicate that 

demand for Far West Native spearmint 

oil has been gradually increasing since 

2009. Spearmint oil handlers, who 

previously projected the 2014–2015 

trade demand for Far West Native 

spearmint oil to be in the range of 

1,100,000 pounds to 1,400,000 pounds 

(with an average of 1,300,000 pounds), 

have projected trade demand for the 

2015–2016 marketing period to be in the 

range of 1,290,000 pounds to 1,400,000 

pounds (with an average of 1,347,500). 

Given the above, the Committee 

estimates that approximately 1,300,000 

pounds of Native spearmint oil may be 

sold during the 2015–2016 marketing 

year. When considered in conjunction 

with the estimated carry-in of 117,368 

pounds of Native spearmint oil on June 

1, 2015, the recommended salable 

quantity of 1,341,269 pounds results in 

an estimated total available supply of 

1,458,637 pounds of Native spearmint 

oil during the 2015–2016 marketing 

year. Estimated carry-in of Native 

spearmint oil at the beginning of the 

2016–2017 marketing year would be 

approximately 152,137 pounds. Carry-in 

spearmint oil is distinct from reserve 

pool spearmint oil and represents the 

amount of salable spearmint oil 

produced, but not marketed, in previous 

years and is available for sale in the 

current year. It is the primary measure 

of excess spearmint oil supply under the 

order. Reserve pool oil represents the 

amount of excess oil held by the 

Committee, on behalf of the producers, 

that is not currently available to the 

market. 

The Committee’s stated intent in the 

use of marketing order volume control 

regulations for Native spearmint oil is to 

keep adequate supplies available to 

meet market needs and maintain orderly 

marketing conditions. With that in 

mind, the Committee developed its 

recommendation for the proposed 

Native spearmint oil salable quantity 

and allotment percentage for the 2015– 

2016 marketing year based on the 

information discussed above, as well as 

the data outlined below. 

(A) Estimated carry-in of Native 

spearmint oil on June 1, 2015—117,368 

pounds. This figure is the difference 

between the revised 2014–2015 

marketing year total available supply of 

1,458,368 pounds and the estimated 

2014–2015 marketing year trade 

demand of 1,341,000 pounds. 

(B) Estimated trade demand of Native 

spearmint oil for the 2015–2016 

marketing year—1,306,500 pounds. This 

estimate is established by the 

Committee and is based on input from 

producers at six Native spearmint oil 

production area meetings held in late 

September and early October 2014, as 

well as estimates provided by handlers 

and other meeting participants at the 

November 5, 2014, meeting. The average 

estimated trade demand provided at the 

six production area meetings was 

1,330,167 pounds, whereas the 

handlers’ estimates ranged from 

1,250,000 pounds to 1,400,000 pounds, 

and averaged 1,356,750 pounds. The 

average of Far West Native spearmint oil 

sales over the last three years is 

1,306,492 pounds. 

(C) Salable quantity of Native 

spearmint oil required from the 2015– 

2016 marketing year production— 

1,189,132 pounds. This figure is the 

difference between the estimated 2015– 

2016 marketing year trade demand 

(1,306,500 pounds) and the estimated 

carry-in on June 1, 2015 (117,368 

pounds). This is the minimum amount 

that the Committee believes would be 

required to meet the anticipated 2015– 

2016 Native spearmint oil trade 

demand. 

(D) Total estimated allotment base of 

Native spearmint oil for the 2015–2016 

marketing year—2,395,124 pounds. This 

figure represents a one-percent increase 

over the revised 2014–2015 total 

allotment base. This figure is generally 

revised each year on June 1 due to 

producer base being lost due to the bona 

fide effort production provisions of 

§ 985.53(e). The revision is usually 

minimal. 

(E) Computed Native spearmint oil 

2015–2016 marketing year allotment 

percentage—49.6 percent. This 

percentage is computed by dividing the 

required salable quantity (1,189,132) by 

the total estimated allotment base 

(2,395,124 pounds). 

(F) Recommended Native spearmint 

oil 2015–2016 marketing year allotment 

percentage—56 percent. This is the 

Committee’s recommendation based on 

the computed allotment percentage 

(49.6 percent), the average of the 

computed allotment percentage figures 

from the six production area meetings 

(51.0 percent), and input from 

producers and handlers at the 

November 5, 2014, meeting. The 

recommended 56 percent allotment 

percentage is also based on the 

Committee’s belief that the computed 

percentage (49.6 percent) may not 

adequately supply the potential 2015– 

2016 Native spearmint oil market. 

(G) Recommended Native spearmint 

oil 2015–2016 marketing year salable 

quantity—1,341,269 pounds. This figure 

is the product of the recommended 

allotment percentage (56 percent) and 


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the total estimated allotment base 

(2,395,124 pounds). 

(H) Estimated available supply of 

Native spearmint oil for the 2015–2016 

marketing year—1,458,637 pounds. This 

figure is the sum of the 2015–2016 

recommended salable quantity 

(1,341,269 pounds) and the estimated 

carry-in on June 1, 2015 (117,368 

pounds). 

The salable quantity is the total 

quantity of each class of spearmint oil 

that handlers may purchase from, or 

handle on behalf of, producers during a 

marketing year. Each producer is 

allotted a share of the salable quantity 

by applying the allotment percentage to 

the producer’s allotment base for the 

applicable class of spearmint oil. 

The Committee’s recommended 

Scotch and Native spearmint oil salable 

quantities and allotment percentages of 

1,265,853 pounds and 60 percent, and 

1,341,269 pounds and 56 percent, 

respectively, are based on the goal of 

maintaining market stability. The 

Committee anticipates that this goal 

would be achieved by matching the 

available supply of each class of 

Spearmint oil to the estimated demand 

of such, thus avoiding extreme 

fluctuations in inventories and prices. 

The proposed salable quantities are 

not expected to cause a shortage of 

spearmint oil supplies. Any 

unanticipated or additional market 

demand for spearmint oil which may 

develop during the marketing year 

could be satisfied by an intra-seasonal 

increase in the salable quantity. The 

order contains a provision for intraseasonal increases to allow the 

Committee the flexibility to respond 

quickly to changing market conditions. 

Under volume regulation, producers 

who produce more than their annual 

allotments during the 2015–2016 

marketing year may transfer such excess 

spearmint oil to producers who have 

produced less than their annual 

allotment. In addition, up until 

December 1, 2015, producers may place 

excess spearmint oil production into the 

reserve pool to be released in the future 

in accordance with market needs. 

This proposed regulation, if adopted, 

would be similar to regulations issued 

in prior seasons. The average initial 

allotment percentage for the five most 

recent marketing years for Scotch 

spearmint oil is 44.0 percent, while the 

average initial allotment percentage for 

the same five-year period for Native 

spearmint oil is 48.8 percent. 

Costs to producers and handlers 

resulting from this rule are expected to 

be offset by the benefits derived from a 

stable market and increased returns. In 

conjunction with the issuance of this 

proposed rule, USDA has reviewed the 

Committee’s marketing policy statement 

for the 2015–2016 marketing year. The 

Committee’s marketing policy 

statement, a requirement whenever the 

Committee recommends volume 

regulation, fully meets the intent of 

§ 985.50 of the order. 

During its discussion of potential 

2015–2016 salable quantities and 

allotment percentages, the Committee 

considered: (1) The estimated quantity 

of salable oil of each class held by 

producers and handlers; (2) the 

estimated demand for each class of oil; 

(3) the prospective production of each 

class of oil; (4) the total of allotment 

bases of each class of oil for the current 

marketing year and the estimated total 

of allotment bases of each class for the 

ensuing marketing year; (5) the quantity 

of reserve oil, by class, in storage; (6) 

producer prices of oil, including prices 

for each class of oil; and (7) general 

market conditions for each class of oil, 

including whether the estimated season 

average price to producers is likely to 

exceed parity. Conformity with USDA’s 

‘‘Guidelines for Fruit, Vegetable, and 

Specialty Crop Marketing Orders’’ has 

also been reviewed and confirmed. 

The establishment of these salable 

quantities and allotment percentages 

would allow for anticipated market 

needs. In determining anticipated 

market needs, the Committee 

considered historical sales, as well as 

changes and trends in production and 

demand. This rule also provides 

producers with information on the 

amount of spearmint oil that should be 

produced for the 2015–2016 season in 

order to meet anticipated market 

demand. 

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 the 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 eight spearmint oil handlers 

subject to regulation under the order, 

and approximately 37 producers of 

Scotch spearmint oil and approximately 

91 producers of Native spearmint oil in 

the regulated production area. Small 

agricultural service firms are defined by 

the Small Business Administration 

(SBA) as those having annual receipts of 

less than $7,000,000, and small 

agricultural producers are defined as 

those having annual receipts of less than 

$750,000 (13 CFR 121.201). 

Based on the SBA’s definition of 

small entities, the Committee estimates 

that two of the eight handlers regulated 

by the order could be considered small 

entities. Most of the handlers are large 

corporations involved in the 

international trading of essential oils 

and the products of essential oils. In 

addition, the Committee estimates that 

11 of the 37 Scotch spearmint oil 

producers, and 25 of the 91 Native 

spearmint oil producers could be 

classified as small entities under the 

SBA definition. Thus, a majority of 

handlers and producers of Far West 

spearmint oil may not be classified as 

small entities. 

The Far West spearmint oil industry 

is characterized by producers whose 

farming operations generally involve 

more than one commodity, and whose 

income from farming operations is not 

exclusively dependent on the 

production of spearmint oil. A typical 

spearmint oil-producing operation has 

enough acreage for rotation such that 

the total acreage required to produce the 

crop is about one-third spearmint and 

two-thirds rotational crops. Thus, the 

typical spearmint oil producer has to 

have considerably more acreage than is 

planted to spearmint during any given 

season. Crop rotation is an essential 

cultural practice in the production of 

spearmint oil for purposes of weed, 

insect, and disease control. To remain 

economically viable with the added 

costs associated with spearmint oil 

production, a majority of spearmint oilproducing farms fall into the SBA 

category of large businesses. 

Small spearmint oil producers 

generally are not as extensively 

diversified as larger ones and, as such, 

are more at risk from market 

fluctuations. Such small producers 

generally need to market their entire 

annual production of spearmint oil and 

are not financially able to hold 

spearmint oil for sale in future years. In 

addition, small producers generally do 

not have a large assortment of other 

crops to cushion seasons with poor 

spearmint oil returns. Conversely, large 

diversified producers have the potential 

to endure one or more seasons of poor 

spearmint oil markets because income 

from alternate crops could support the 

operation for a period of time. That 

being said being reasonably assured of 


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a stable price and market provides all 

producing entities with the ability to 

maintain proper cash flow and to meet 

annual expenses. The benefits for this 

rule are expected to be equally available 

to all producers and handlers regardless 

of their size. 

This proposed rule would establish 

the quantity of spearmint oil produced 

in the Far West, by class, that handlers 

may purchase from, or handle on behalf 

of, producers during the 2015–2016 

marketing year. The Committee 

recommended this rule to help maintain 

stability in the spearmint oil market by 

matching supply to estimated demand, 

thereby avoiding extreme fluctuations in 

supplies and prices. Establishing 

quantities that may be purchased or 

handled during the marketing year 

through volume regulations allows 

producers to coordinate their spearmint 

oil production with the expected market 

demand. Authority for this action is 

provided in §§ 985.50, 985.51, and 

985.52 of the order. 

Instability in the spearmint oil subsector of the mint industry is much 

more likely to originate on the supply 

side than the demand side. Fluctuations 

in yield and acreage planted from 

season-to-season tend to be larger than 

fluctuations in the amount purchased by 

handlers. Historically, demand for 

spearmint oil tends to change slowly 

from year to year. 

Demand for spearmint oil at the farm 

level is derived from retail demand for 

spearmint-flavored products such as 

chewing gum, toothpaste, and 

mouthwash. The manufacturers of these 

products are by far the largest users of 

spearmint oil. However, spearmint 

flavoring is generally a very minor 

component of the products in which it 

is used, so changes in the raw product 

price have virtually no impact on retail 

prices for those goods. 

Spearmint oil production tends to be 

cyclical. Years of relatively high 

production, with demand remaining 

reasonably stable, have led to periods in 

which large producer stocks of unsold 

spearmint oil have depressed producer 

prices for a number of years. Shortages 

and high prices may follow in 

subsequent years, as producers respond 

to price signals by cutting back 

production. 

The significant variability of the 

spearmint oil market is illustrated by 

the fact that the coefficient of variation 

(a standard measure of variability; 

‘‘CV’’) of Far West spearmint oil grower 

prices for the period 1980–2013 (when 

the marketing order was in effect) is 

0.23, compared to 0.36 for the decade 

prior to the promulgation of the order 

(1970–79) and 0.49 for the prior 20-year 

period (1960–79). This provides an 

indication of the price stabilizing 

impact of the marketing order. 

Production in the shortest marketing 

year was about 47 percent of the 34-year 

average (1.92 million pounds from 1980 

through 2013) and the largest crop was 

approximately 160 percent of the 34- 

year average. A key consequence is that, 

in years of oversupply and low prices, 

the season average producer price of 

spearmint oil is below the average cost 

of production (as measured by the 

Washington State University 

Cooperative Extension Service). 

The wide fluctuations in supply and 

prices that result from this cycle, which 

was even more pronounced before the 

creation of the order, can create 

liquidity problems for some producers. 

The order was designed to reduce the 

price impacts of the cyclical swings in 

production. However, producers have 

been less able to weather these cycles in 

recent years because of the increase in 

production costs. While prices have 

been relatively steady, the cost of 

production has increased to the extent 

that plans to plant spearmint may be 

postponed or changed indefinitely. 

Producers may also be enticed by the 

prices of alternative crops and their 

lower cost of production. 

In an effort to stabilize prices, the 

spearmint oil industry uses the volume 

control mechanisms authorized under 

the order. This authority allows the 

Committee to recommend a salable 

quantity and allotment percentage for 

each class of oil for the upcoming 

marketing year. The salable quantity for 

each class of oil is the total volume of 

oil that producers may sell during the 

marketing year. The allotment 

percentage for each class of spearmint 

oil is derived by dividing the salable 

quantity by the total allotment base. 

Each producer is then issued an 

annual allotment certificate, in pounds, 

for the applicable class of oil, which is 

calculated by multiplying the 

producer’s allotment base by the 

applicable allotment percentage. This is 

the amount of oil of each applicable 

class that the producer can market. 

By December 1 of each year, the 

Committee identifies any oil that 

individual producers have produced 

above the volume specified on their 

annual allotment certificates. This 

excess oil is placed in a reserve pool 

administered by the Committee. A 

reserve pool is maintained for each class 

of oil that may not be sold during the 

current marketing year unless USDA 

approves a Committee recommendation 

to increase the salable quantity and 

allotment percentage for a class of oil 

and make a portion of the pool 

available. 

Limited quantities of excess oil may 

be sold by one producer to another 

producer to fill production deficiencies 

in a marketing year. A deficiency occurs 

when on-farm production is less than a 

producer’s allotment. When a producer 

has a deficiency, the producer’s own 

reserve oil can be utilized to fill that 

deficiency, or excess production 

(production of spearmint oil in excess of 

the producer’s annual allotment) from 

another producer may also be secured to 

fill the deficiency. All of these 

provisions need to be exercised prior to 

December 1 of each year. 

In any given year, the total available 

supply of spearmint oil is composed of 

current production plus salable 

carryover stocks from the previous crop. 

The Committee seeks to maintain 

market stability by balancing supply 

and demand, and to close the marketing 

year with an appropriate level of salable 

spearmint oil to carry over into the 

subsequent marketing year. If the 

industry has production in excess of the 

salable quantity, then the reserve pool 

absorbs the surplus quantity of 

spearmint oil, which goes unsold during 

that year, unless the oil is needed for 

unanticipated sales. 

Under its provisions, the order may 

attempt to stabilize prices by (1) limiting 

supply and establishing reserves in high 

production years, thus minimizing the 

price-depressing effect that excess 

producer stocks have on unsold 

spearmint oil, and (2) ensuring that 

stocks are available in short supply 

years when prices would otherwise 

increase dramatically. Reserve pool 

stocks, which increase in high 

production years, are drawn down in 

years where the crop is short. 

An econometric model was used to 

assess the impact that volume control 

has on the prices producers receive for 

their commodity. Without volume 

control, spearmint oil markets would 

likely be over-supplied. This could 

result in low producer prices and a large 

volume of oil stored and carried over to 

the next crop year. The model estimates 

how much lower producer prices would 

likely be in the absence of volume 

controls. 

The Committee estimated trade 

demand for the 2015–2016 marketing 

year for both classes of oil at 2,406,500 

pounds, and that the expected 

combined salable carry-in will be 

117,368 pounds. This results in a 

combined required salable quantity of 

2,289,132 pounds. With volume control, 

sales by producers for the 2015–2016 

marketing year would be limited to 

2,607,122 pounds (the recommended 


Rmajette on DSK2VPTVN1PROD with PROPOSALS
Federal Register / Vol. 80, No. 50 / Monday, March 16, 2015 / Proposed Rules 13507 

salable quantity for both classes of 

spearmint oil). 

The recommended allotment 

percentages, upon which 2015–2016 

producer allotments are based, are 60 

percent for Scotch and 56 percent for 

Native. Without volume controls, 

producers would not be limited to these 

allotment levels, and could produce and 

sell an unrestricted quantity of 

spearmint oil. The econometric model 

estimated a decline of about $1.30 in the 

season average producer price per 

pound (from both classes of spearmint 

oil) resulting from the higher quantities 

that would be produced and marketed 

without volume control. The surplus 

situation for the spearmint oil market 

that would exist without volume 

controls in 2015–2016 also would likely 

dampen prospects for improved 

producer prices in future years because 

of the buildup in stocks. 

The use of volume control allows the 

industry to fully supply spearmint oil 

markets while avoiding the negative 

consequences of over-supplying these 

markets. The use of volume control is 

believed to have little or no effect on 

consumer prices of products containing 

spearmint oil and would not result in 

fewer retail sales of such products. 

The Committee discussed alternatives 

to the recommendations contained in 

this rule for both classes of spearmint 

oil. The Committee discussed and 

rejected the idea of recommending that 

there not be any volume regulation for 

both classes of spearmint oil because of 

the severe price-depressing effects that 

would occur without volume control. 

The Committee also considered salable 

quantities and allotment percentages 

that were above and below the levels 

that were ultimately recommended. 

After computing the initial 52.1 

percent Scotch spearmint oil allotment 

percentage, the Committee considered 

various alternative levels of volume 

control for Scotch spearmint oil. Even 

with the moderately optimistic 

marketing conditions, there was 

consensus from the Committee that the 

Scotch spearmint oil allotment 

percentage for 2015–2016 should be 

more than the percentage initially 

established for the 2014–2015 marketing 

year (55 percent). After considerable 

discussion, the eight-member committee 

unanimously determined that 1,265,853 

pounds and 60 percent would be the 

most effective Scotch spearmint oil 

salable quantity and allotment 

percentage, respectively, for the 2015– 

2016 marketing year. 

The Committee was also able to reach 

a consensus regarding the level of 

volume control for Native spearmint oil. 

After first determining the computed 

allotment percentage at 49.6 percent, the 

Committee unanimously recommended 

1,341,269 pounds and 56 percent for the 

effective Native spearmint oil salable 

quantity and allotment percentage, 

respectively, for the 2015–2016 

marketing year. 

As noted earlier, the Committee’s 

recommendation to establish salable 

quantities and allotment percentages for 

both classes of spearmint oil was made 

after careful consideration of all 

available information including: (1) The 

estimated quantity of salable oil of each 

class held by producers and handlers; 

(2) the estimated demand for each class 

of oil; (3) the prospective production of 

each class of oil; (4) the total of 

allotment bases of each class of oil for 

the current marketing year and the 

estimated total of allotment bases of 

each class for the ensuing marketing 

year; (5) the quantity of reserve oil, by 

class, in storage; (6) producer prices of 

oil, including prices for each class of oil; 

and (7) general market conditions for 

each class of oil, including whether the 

estimated season average price to 

producers is likely to exceed parity. 

Based on its review, the Committee 

believes that the salable quantities and 

allotment percentages recommended 

would achieve the objectives sought. 

The Committee also believes that, 

should there be no volume regulation in 

effect for the upcoming marketing year, 

the Far West spearmint oil industry 

would return to the pronounced cyclical 

price patterns that occurred prior to the 

promulgation of the order. As 

previously stated, annual salable 

quantities and allotment percentages 

have been issued for both classes of 

spearmint oil since the order’s 

inception. The salable quantities and 

allotment percentages proposed herein 

are expected to facilitate the goal of 

maintaining orderly marketing 

conditions for Far West spearmint oil 

for the 2015–2016 and future marketing 

years. 

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 the Office of 

Management and Budget (OMB) and 

assigned OMB No. 0581–0178, 

Vegetable and Specialty Crops. No 

changes in those requirements as a 

result of this action are necessary. 

Should any changes become necessary, 

they would be submitted to OMB for 

approval. 

This proposed rule would establish 

the salable quantities and allotment 

percentages for Class 1 (Scotch) 

spearmint oil and Class 3 (Native) 

spearmint oil produced in the Far West 

during the 2015–2016 marketing year. 

Accordingly, this action would not 

impose any additional reporting or 

recordkeeping requirements on either 

small or large spearmint oil producers 

or handlers. As with all Federal 

marketing order programs, reports and 

forms are periodically reviewed to 

reduce information requirements and 

duplication by industry and public 

sector agencies. 

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. 

USDA has not identified any relevant 

Federal rules that duplicate, overlap, or 

conflict with this proposed rule. 

The Committee’s meeting was widely 

publicized throughout the spearmint oil 

industry and all interested persons were 

invited to attend the meeting and 

participate in Committee deliberations 

on all issues. Like all Committee 

meetings, the November 5, 2014, 

meeting was a public meeting and all 

entities, both large and small, were able 

to express views on this issue. 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 Jeffrey Smutny 

at the previously mentioned address in 

the FOR FURTHER INFORMATION CONTACT

section. 

A 15-day comment period is provided 

to allow interested persons to respond 

to this proposed rule. Fifteen days is 

deemed appropriate because: (1) The 

2015–2016 fiscal period begins on June 

1, 2015, and a final determination on 

the salable quantities and allotment 

percentages should be made prior to 

handlers purchasing from, or handling 

on behalf of, producers of any oil for the 

ensuing marketing year; and (2) 

handlers are aware of this action, which 

was recommended by the Committee at 

a public meeting and is similar to other 

salable quantities and allotment 

percentages issued in past years. 

List of Subjects in 7 CFR Part 985 

Marketing agreements, Oils and fats, 

Reporting and recordkeeping 

requirements, Spearmint oil. 


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13508 Federal Register / Vol. 80, No. 50 / Monday, March 16, 2015 / Proposed Rules 

For the reasons set forth in the 

preamble, 7 CFR part 985 is proposed to 

be amended as follows: 

PART 985—MARKETING ORDER 

REGULATING THE HANDLING OF 

SPEARMINT OIL PRODUCED IN THE 

FAR WEST 

■ 1. The authority citation for 7 CFR 

part 985 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

■ 2. A new § 985.234 is added to read 

as follows: 

§ 985.234 Salable quantities and allotment 

percentages—2015–2016 marketing year. 

The salable quantity and allotment 

percentage for each class of spearmint 

oil during the marketing year beginning 

on June 1, 2015, shall be as follows: 

(a) Class 1 (Scotch) oil—a salable 

quantity of 1,265,853 pounds and an 

allotment percentage of 60 percent. 

(b) Class 3 (Native) oil—a salable 

quantity of 1,341,269 pounds and an 

allotment percentage of 56 percent. 

Dated: March 9, 2015. 

Rex A. Barnes, 

Associate Administrator, Agricultural 

Marketing Service. 

[FR Doc. 2015–05681 Filed 3–13–15; 8:45 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Food and Drug Administration 

21 CFR Part 176 

[Docket No. FDA–2015–F–0714] 

Natural Resources Defense Council et 

al.; Filing of Food Additive Petition 

AGENCY: Food and Drug Administration, 

HHS. 

ACTION: Notice of petition. 

SUMMARY: The Food and Drug 

Administration (FDA or we) is 

announcing that we have filed a 

petition, submitted by the Natural 

Resources Defense Council, the Center 

for Food Safety, the Breast Cancer Fund, 

the Center for Environmental Health, 

Clean Water Action, the Center for 

Science in the Public Interest, 

Children’s Environmental Health 

Network, Environmental Working 

Group, and Improving Kids’ 

Environment, proposing that we amend 

our food additive regulation to no longer 

provide for the use of three specific 

perfluoroalkyl ethyl containing foodcontact substances (FCSs) as oil and 

water repellants for paper and 

paperboard for use in contact with 

aqueous and fatty foods. 

DATES: The food additive petition was 

filed on January 7, 2015. 

FOR FURTHER INFORMATION CONTACT: Paul 

Honigfort, Center for Food Safety and 

Applied Nutrition (HFS–275), Food and 

Drug Administration, 5100 Paint Branch 

Pkwy., College Park, MD 20740–3835, 

240–402–1206. 

SUPPLEMENTARY INFORMATION: 

I. Background 

Under section 409(b)(5) of the Federal 

Food, Drug, and Cosmetic Act (the 

FD&C Act) (21 U.S.C. 348(b)(5)), we are 

giving notice that we have filed a food 

additive petition (FAP 4B4809), 

submitted by the Natural Resources 

Defense Council, 1152 15th St. NW., 

Suite 300, Washington, DC 20005; the 

Center for Food Safety, 303 Sacramento 

St., Second Floor, San Francisco, CA 

94111; Clean Water Action, 144 Eye St. 

NW., Suite 400, Washington, DC 20005; 

the Center for Science in the Public 

Interest, 1220 L St. NW., Suite 300, 

Washington, DC 20005; Children’s 

Environmental Health Network, 110 

Maryland Ave. NE., Suite 402, 

Washington, DC 20002; the Breast 

Cancer Fund, 1388 Sutter St., Suite 400, 

San Francisco, CA 94109–5400; the 

Center for Environmental Health, 2201 

Broadway, Suite 302, Oakland, CA, 

94612; Environmental Working Group, 

1436 U St. NW., Suite 100, Washington, 

DC 20009; and Improving Kids’ 

Environment, 1915 West 18th St., 

Indianapolis, IN 46202. The petition 

proposes that we amend § 176.170 (21 

CFR 176.170) to no longer provide for 

the use of three perfluoroalkyl ethyl 

containing food-contact substances 

(FCSs) as oil and water repellants for 

paper and paperboard for use in contact 

with aqueous and fatty foods. The three 

FCSs which are the subjects of this 

petition are as follows: 

1. Diethanolamine salts of mono- and 

bis (1H,1H,2H,2H perfluoroalkyl) 

phosphates where the alkyl group is 

even-numbered in the range C8-C18 and 

the salts have a fluorine content of 52.4 

percent to 54.4 percent as determined 

on a solids basis; 

2. Pentanoic acid, 4,4-bis [(gammaomega-perfluoro-C8-20-alkyl)thio] 

derivatives, compounds with 

diethanolamine (CAS Reg. No. 71608– 

61–2); and 

3. Perfluoroalkyl substituted 

phosphate ester acids, ammonium salts 

formed by the reaction of 2,2- 

bis[([gamma], [omega]-perfluoro C4-20 

alkylthio) methyl]-1,3-propanediol, 

polyphosphoric acid and ammonium 

hydroxide. 

II. Amendment of § 176.170 

In accordance with procedures 

specified in § 171.130 (21 CFR 171.130) 

for amending or revoking a food 

additive regulation, the petition asks us 

to amend § 176.170 so that it would no 

longer provide for the use of three 

perfluoroalkyl ethyl containing FCSs as 

oil and water repellants for paper and 

paperboard for use in contact with 

aqueous and fatty foods. If we determine 

that new data are available regarding the 

toxicity of these FCSs that justify 

amending § 176.170 so that it would no 

longer allow their use, we will publish 

such an amendment of the regulation in 

the Federal Register, as set forth in 

§ 171.130 and § 171.100 (21 CFR 

171.100). 

We have determined under 21 CFR 

25.32(m) that this action is of a type that 

does not individually or cumulatively 

have a significant effect on the human 

environment. Therefore, neither an 

environmental assessment nor an 

environmental impact statement is 

required. 

Dated: March 9, 2015. 

Leslie Kux, 

Associate Commissioner for Policy. 

[FR Doc. 2015–05938 Filed 3–13–15; 8:45 am] 

BILLING CODE 4164–01–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Food and Drug Administration 

21 CFR Parts 170, 177, and 189 

[Docket No. FDA–2015–F–0537] 

Natural Resources Defense Council et 

al.; Filing of Food Additive Petition 

AGENCY: Food and Drug Administration, 

HHS. 

ACTION: Notice of petition. 

SUMMARY: The Food and Drug 

Administration (FDA or we) is 

announcing that we have filed a 

petition, submitted by the Natural 

Resources Defense Council, Center for 

Food Safety, Clean Water Action, 

Children’s Environmental Health 

Network, Center for Science in the 

Public Interest, Breast Cancer Fund, 

Center for Environmental Health, 

Environmental Working Group, and 

Improving Kids’ Environment, 

proposing that we amend our regulation 

to no longer provide for the use of 

potassium perchlorate as an additive in 

closure-sealing gaskets for food 

containers, revoke the Threshold of 

Regulation exemption No. 2005–006 to 

no longer exempt the use of sodium 


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