Federal Register / Vol. 62, No. 210 / Thursday, October 30, 1997 / Rules and Regulations 58633

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 905

[Docket No. FV97–905–1 IFR]

Oranges, Grapefruit, Tangerines, and

Tangelos Grown in Florida; Limiting

the Volume of Small Florida Red

Seedless Grapefruit

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Amended interim final rule

with request for comments.

SUMMARY: This interim final rule

amends a prior interim final rule that

limited the volume of small red seedless

grapefruit entering the fresh market

under the Florida citrus marketing

order. The marketing order regulates the

handling of oranges, grapefruit,

tangerines, and tangelos grown in

Florida and is administered locally by

the Citrus Administrative Committee

(committee). The prior interim final rule

limited the volume of size 48 and/or

size 56 red seedless grapefruit handlers

could ship during the first 11 weeks of

the 1997–1998 season that began in

September. This rule changes the

weekly percentages for the last five

weeks of the regulatory period from 30

percent to 35 percent. These revisions

will provide a sufficient supply of small

sized red seedless grapefruit to meet

market demand, without saturating all

markets with these small sizes. This rule

is necessary to help stabilize the market

and improve grower returns.

DATES: Effective October 31, 1997

through November 30, 1997. Comments

received by November 10, 1997 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 in triplicate to the Docket Clerk,

Fruit and Vegetable Division, AMS,

USDA, room 2525–S, P.O. Box 96456,

Washington, DC 20090–6456; Fax: (202)

720–5698. 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.

FOR FURTHER INFORMATION CONTACT:

Christian D. Nissen, Southeast

Marketing Field Office, Marketing Order

Administration Branch, F&V, AMS,

USDA, P.O. Box 2276, Winter Haven,

Florida 33883; telephone: (941) 299–

4770, Fax: (941) 299–5169; or Anne Dec,

Marketing Order Administration

Branch, F&V, AMS, USDA, room 2522–

S, P.O. Box 96456, Washington, DC

20090–6456; telephone: (202) 720–5053,

Fax: (202) 720–5698. Small businesses

may request information on compliance

with this regulation by contacting Jay

Guerber, Marketing Order

Administration Branch, F&V, AMS,

USDA, room 2525–S, P.O. Box 96456,

Washington, DC 20090–6456; telephone

(202) 720–2491, Fax: (202) 720–5698.

SUPPLEMENTARY INFORMATION: This

amended interim final rule is issued

under Marketing Agreement No. 84 and

Marketing Order No. 905, both as

amended (7 CFR part 905), regulating

the handling of oranges, grapefruit,

tangerines, and tangelos grown in

Florida, hereinafter referred to as the

‘‘order.’’ The marketing agreement and

order are 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

(Department) is issuing this rule in

conformance with Executive Order

12866.

This interim final rule has been

reviewed under Executive Order 12988,

Civil Justice Reform. This rule is

intended to apply to weekly shipments

of red seedless grapefruit beginning

October 27 through November 30, 1997.

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 the Secretary 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 the Secretary 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 the Secretary’s ruling on the

petition, provided an action is filed not

later than 20 days after date of the entry

of the ruling.

The order provides for the

establishment of grade and size

requirements for Florida citrus, with the

concurrence of the Secretary. These

grade and size requirements are

designed to provide fresh markets with

citrus fruit of acceptable quality and

size. This helps create buyer confidence

and contributes to stable marketing

conditions. This is in the interest of

growers, handlers, and consumers, and

is designed to increase returns to

Florida citrus growers. The current

minimum grade standard for red

seedless grapefruit is U.S. No. 1, and the

minimum size requirement is size 56 (at

least 35⁄16 inches in diameter).

Section 905.52 of the citrus marketing

order provides authority to limit

shipments of any grade or size, or both,

of any variety of Florida citrus. Such

limitations may restrict the shipment of

a portion of a specified grade or size of

a variety. Under such a limitation, the

quantity of such grade or size that may

be shipped by a handler during a

particular week is established as a

percentage of the total shipments of

such variety by such handler in a prior

period, established by the committee

and approved by the Secretary, in which

the handler shipped such variety.

Section 905.153 of the order provides

procedures for limiting the volume of

small red seedless grapefruit entering

the fresh market. The procedures

specify that the committee may

recommend that only a certain

percentage of sizes 48 and/or 56 red

seedless grapefruit be made available for

shipment into fresh market channels for

any week or weeks during the regulatory

period. The 11 week period begins the

third Monday in September. Under such

a limitation, the quantity of sizes 48

and/or 56 red seedless grapefruit that

may be shipped by a handler during a

regulated week is calculated using the

recommended percentage. By taking the

recommended weekly percentage times

the average weekly volume of red

grapefruit handled by such handler in

the previous five seasons, handlers can

calculate the volume of sizes 48 and/or

56 they may ship in a regulated week.

This rule amends an interim final rule

published September 12, 1997, in the

Federal Register (62 FR 47913). That

rule limited the volume of small red

seedless grapefruit entering the fresh

market for each week of an 11 week

period beginning the week of September

15. That rule limited the volume of sizes

48 and/or 56 red seedless grapefruit by

establishing a weekly percentage for

each of the 11 weeks. This amended

interim final rule changes the weekly

percentage for the last five weeks of the

regulatory period from 30 percent to 35

percent.

This is a change in the percentages

originally recommended by the

committee. The committee had voted at

its May 28, 1997, meeting to establish a

weekly percentage of 25 percent for
58634 Federal Register / Vol. 62, No. 210 / Thursday, October 30, 1997 / Rules and Regulations

each of the 11 weeks in a vote of 10 in

favor to 7 opposed at its meeting on May

28, 1997. The committee recommended

adjusting the percentages at its meeting

August 26, 1997, in a vote of 14 in favor

to 3 opposed, recommending weekly

percentages of 50 percent for the first

three weeks (September 15 through

October 5), 35 percent for the next three

weeks (October 6 through October 26),

and at 30 percent for the remainder of

the 11 weeks. The committee met again,

October 14, 1997, and in a unanimous

vote recommended changing the weekly

percentage for the last five weeks from

30 percent to 35 percent.

For the past few seasons, returns on

red seedless grapefruit have been at all

time lows, often not returning the cost

of production. On tree prices for red

seedless grapefruit have declined

steadily from $9.60 per box (13⁄5 bushel)

during the 1989–90 season, to $3.11 per

box during the 1992–93 season, to $1.82

per box during the 1994–95 season, to

$1.55 per box during the 1996–97

season. The committee believes that to

stabilize the market and improve returns

to growers, demand for fresh red

seedless grapefruit must be stabilized

and increased.

One problem contributing to the

current state of the market is the

excessive number of small sized

grapefruit shipped early in the

marketing season. During the past three

seasons, sizes 48 and 56 accounted for

34 percent of total shipments during the

11 week regulatory period, with the

average weekly percentage exceeding 40

percent of shipments. This contrasts

with sizes 48 and 56 representing only

26 percent of total shipments for the

remainder of the season. While there is

a market for early grapefruit, the

shipment of large quantities of small red

seedless grapefruit in a short period

oversupplies the fresh market for these

sizes and negatively impacts the market

for all sizes.

For the majority of the season, larger

sizes return better prices than smaller

sizes. However, there is a push early in

the season to get fruit into the market to

take advantage of the higher prices

available at the beginning of the season.

The early season crop tends to have a

greater percentage of small sizes. This

creates a glut of smaller, lower priced

fruit on the market that drives down the

price for all sizes. Early in the season,

larger sized fruit commands a premium

price. In some cases, the f.o.b. is $4 to

$6 a carton (4⁄5 bushel) more than for the

smaller sizes. In early October, the f.o.b.

for a size 27 averages around $10.00 per

carton. This compares to an average

f.o.b. of $5.50 per carton for size 56. By

the end of the 11 week period outlined

in this rule, the f.o.b. for large sizes has

dropped to within two dollars of the

f.o.b. for small sizes.

In the past three seasons, during the

period covered by this rule, prices of red

seedless grapefruit have fallen from a

weighted average f.o.b. of $7.80 per

carton to an average f.o.b. of $5.50 per

carton. Even though later in the season

the crop has sized to naturally limit the

amount of smaller sizes available for

shipment, the price structure in the

market has already been negatively

affected. In the past three years, the

market has not recovered, and the f.o.b.

for all sizes fell to around $5.00 to $6.00

per carton for most of the rest of the

season.

The committee discussed this issue at

length at several meetings. The

committee believes that the over

shipment of smaller sized red seedless

grapefruit early in the season has

contributed to below production cost

returns for growers and lower on tree

values. An economic study done by the

University of Florida—Institute of Food

and Agricultural Sciences (UF–IFAS) in

May 1997, found that on tree prices

have fallen from a high near $7.00 in

1991–92 to around $1.50 for this past

season. The study projects that if the

industry elects to make no changes, the

on tree price will remain around $1.50.

The study also indicates that increasing

minimum size restrictions could help to

raise returns.

The committee examined shipment

data covering the 11 week regulatory

period for the last four seasons. The

information contained the amounts and

percentages of sizes 48 and 56 shipped

during each week. They compared this

information with tables outlining

weekly f.o.b. figures for each size. Based

on this statistical information from past

seasons, the committee members believe

there is an indication that once

shipments of sizes 48 and 56 reach

levels above 250,000 cartons a week,

prices decline on those and most other

sizes of red seedless grapefruit. Without

volume regulation, the industry has

been unable to limit the shipments of

small sizes. The committee believes that

if shipments of small sizes can be

maintained at around 250,000 cartons a

week, prices should stabilize and

demand for larger, more profitable sizes

should increase.

The committee has had considerable

discussion regarding at what level to

establish the weekly percentages. They

wanted to recommend weekly

percentages that would provide a

sufficient volume of small sizes without

adversely impacting the markets for

larger sizes. At its May 28, 1997,

meeting, the committee recommended

that the percentage for each of the 11

weeks be established at the 25 percent

level. Their reasoning was that this

percentage, when combined with the

average weekly shipments for the total

industry, provided a total industry

allotment of 244,195 cartons of sizes 48

and/or 56 red seedless grapefruit per

regulated week. This percentage would

have allowed total shipments of small

red seedless grapefruit to approach the

250,000 carton mark during regulated

weeks without exceeding it.

During committee deliberations at the

May 28, 1997, meeting, several concerns

were raised regarding the regulation.

One area of concern was the possible

impact the regulation may have on

exports. Several members stated that

there was a strong demand in some

export markets for small sizes. Other

members responded that the

percentages set allow handlers enough

volume of small sizes to meet the

demand in these markets. It was also

stated that any shortfall an individual

handler might have can be filled by loan

or transfer. There was also some

discussion that markets that normally

demand small sizes have shown a

willingness to purchase larger sizes. In

addition, committee data indicate that

the majority of export shipments occur

after the 11 week period when there are

no restrictions on small sizes.

Another concern raised was the effect

the action would have on packouts. It

was stated that the rule could reduce the

volume packed, resulting in higher

packinghouse costs. The purpose of the

recommended rule was to limit the

volume of small sizes marketed early in

the season. Larger sizes can be

substituted for smaller sizes with a

minimum effect on overall shipments.

The rule might require more selective

picking of only the sizes desired,

something that many growers are doing

already. The UF–IFAS study presented

indicated that it would increase returns

if growers would harvest selectively and

return to repick groves as the grapefruit

sized. This also would allow growers to

maximize returns on fresh grapefruit by

not picking unprofitable grades and

sizes of red grapefruit that will be sent

to the less profitable processing market.

The study also indicated that selective

harvesting can reduce the f.o.b. cost per

carton, and therefore, have a positive

impact on grower returns.

Several members were concerned

about what would happen if market

conditions were to change. Other

committee members responded that if

industry conditions were to change (for

example, if there was a freeze, or if the

grapefruit was not sizing), the

committee could meet and recommend
Federal Register / Vol. 62, No. 210 / Thursday, October 30, 1997 / Rules and Regulations 58635

that the percentage be raised to allow for

more small sizes, or that the limits be

removed all together.

Another concern raised at the May 28,

1997, meeting was that market share

could be lost to Texas. According to the

Economic Analysis Branch (EAB), of the

Fruit and Vegetable Division, of the

Agricultural Marketing Service (AMS),

limiting shipments of small Florida

grapefruit will probably not result in a

major shift to Texas grapefruit because

the Texas industry is much smaller and

has higher freight costs to some markets

supplied by Florida. The UF–IFAS

study made similar findings. Texas

production is much smaller and has

been susceptible to freezes that take it

out of the market.

This has lessened its impact on the

overall grapefruit market.

At the May 28, 1997, meeting, one

handler expressed that they ship early

in the season and this action could be

very restrictive. Members responded

that the availability of loans and

transfers address these concerns. There

was also discussion of how restrictive

this rule actually is. Based on shipments

from the past four seasons, available

allotment would have exceeded actual

shipments for each of the first three

weeks that are regulated under this rule

even if the weekly percentage was set at

25 percent. In the three seasons prior to

last season, if a 25 percent restriction on

small sizes had been applied during the

11 week period, only an average of 4.2

percent of overall shipments during that

period would have been affected. The

rule published on September 12, 1997,

affected even fewer shipments by

establishing less restrictive weekly

percentages. In addition, a large

percentage of this volume most likely

could have been replaced by larger

sizes. A sufficient volume of small sized

red grapefruit was still allowed into all

channels of trade, and allowances were

in place to help handlers address any

market shortfall.

The committee met again August 26,

1997, and revisited the weekly

percentage issue. At the meeting, the

committee recommended that the

weekly percentages be changed from 25

percent for each of the 11 regulated

weeks to 50 percent for the first three

weeks (September 15 through October

5), 35 percent for the next three weeks

(October 6 through October 26), and 30

percent for the remainder of the 11

weeks.

In its discussion of this change, the

committee reviewed the initial

percentages recommended and the

current state of the crop. The committee

also reexamined shipping information

from past seasons, looking particularly

at volume across the 11 weeks. Based on

shipments from the past four seasons,

available allotment under a 25 percent

restriction would have exceeded actual

shipments for each of the first three

weeks that are regulated under this rule.

The committee recognized that in

terms of available allotment,

establishing a weekly percentage of 25

percent for the first three regulated

weeks would not be restrictive.

However, they said that this was based

on total available allotment, not on data

for each individual handler. The

committee determined that if available

allotment would exceed shipments for

the first three weeks even when

establishing a percentage of 25 percent,

it would give individual handlers

greater flexibility during these three

weeks to establish the percentage at 50

percent. They argued that this would

provide each handler with additional

allotment during these three weeks,

reducing the number of loans and

transfers needed to utilize the available

allotment, yet having little or no affect

on the volume of small sizes. The

committee also agreed that setting the

percentage at 50 percent rather than 100

percent would still provide some

restriction should shipments for

September 15 through October 5 for this

season exceed past quantities.

For the remainder of the 11 weeks, the

committee believed that the weekly

percentage needed to be less than 50

percent (which would have resulted in

virtually no limitation on shipments of

small sizes) but greater than 25 percent.

The committee held that it is important

to control small sizes, but it is also

important to be able to service the

markets that demand small sizes. The

issue was raised regarding the possible

market impact when small sizes exceed

250,000 cartons in a week. The

committee recognized that ideally,

244,195 cartons of red seedless

grapefruit would be available to the

industry for each of the 11 weeks if the

percentage was set at 25 percent.

However, the committee was concerned

that the true amount available would be

lower. Several members stated that

setting a weekly percentage at 25

percent to approximate the 250,000

cartons was based on total utilization of

allotment, and that assumption was

unreasonable. The committee agreed

that loans and transfers are beneficial,

but that even with their availability a

percentage of allotment would most

likely not be used.

Several other members raised

concerns about focusing too much on

total allotment available, rather than on

allotment available to individual

handlers. The committee stated that the

way a handler’s base is calculated using

an average week is probably the most

equitable way to do so. However, they

acknowledged that it did present some

problems. Members concurred that the

season for red seedless grapefruit is

approximately 33 weeks. However, the

members agreed that this did not mean

that every handler was shipping during

all 33 weeks. They discussed how a

handler’s average weekly shipments are

calculated by averaging their shipments

from the past five seasons, and then

dividing this number by the 33 weeks to

establish an average week. Members

stated that the calculated average week

was often lower than their actual weekly

shipments during the periods they were

shipping because they were not

shipping during all 33 weeks. They also

stated that applying a weekly percentage

of 25 percent to their average week

would have resulted in limiting their

shipments to a level closer to 15 percent

of their actual shipments during this

period.

Based on this discussion, the

committee thought a weekly percentage

of 25 percent would be overly

restrictive. The committee believed that

since total available allotment most

probably will not be fully utilized, and

how individual handlers are affected,

establishing a weekly percentage of 35

percent for the regulation weeks October

6 through October 26 would be more

appropriate. They believed this level

would provide a sufficient supply of

small sizes without exceeding amounts

that would negatively affect other

markets.

The committee further recommended

that the weekly percentage for the

remainder of the 11 weeks be

established at 30 percent. The

committee resolved that a lower

percentage was desirable moving into

the last five weeks of regulation. The

committee believed that as the industry

moves into the season and shipments

increase, a weekly percentage of 30

percent would provide the best balance

between supply and demand for small

sized red seedless grapefruit.

At the August 26, 1997, meeting, the

concern was raised that the weekly

percentages recommended were not

restrictive enough. Committee members

responded that not all available

allotment would be utilized, and that

the recommended percentages would

still restrict shipments of small sizes,

while providing handlers with

flexibility to supply those markets that

demand small sizes.

After considering the concerns

expressed, and the available

information, the committee determined

that the September 12, 1997, interim
58636 Federal Register / Vol. 62, No. 210 / Thursday, October 30, 1997 / Rules and Regulations

final rule was needed to regulate

shipments of small sized red seedless

grapefruit.

However, the committee met again

October 14, 1997, and revisited the

weekly percentage issue. The committee

recommended another revision in the

weekly percentages. The committee

recommended that the weekly

percentage for the final five weeks of the

regulated period (October 27 through

November 30, 1997) be changed from 30

percent to 35 percent.

In its discussion of this change, the

committee reviewed the percentages

previously recommended and the

current state of the crop. In addition, the

committee had some new information

regarding this season that was not

available during its earlier meetings. On

October 10, 1997, the Department

released its crop estimate for Florida

grapefruit. The estimate for total Florida

grapefruit was 54 million boxes, a 3.2

percent reduction from last season. In

addition, the committee was provided

information regarding size distribution

developed from a September size

survey. The size survey was conducted

by the Department as part of the crop

estimate and showed that more small

sizes were available than anticipated.

The committee also had the benefit of

having operated several weeks under a

weekly percentage regulation.

During the committee’s discussion,

there were many comments that the use

of the weekly percentage rule was being

effective. They believed that this rule

was having a positive effect on the

market and on returns. The weekly

percentages, combined with a very

limited processing market, has forced

the industry to do more spot picking for

the available markets.

Several persons attending the

committee meeting encouraged the

committee to stay the course, and leave

the weekly percentages as they were

established. However, others thought

that the 30 percent weekly percentage

rate for the last five weeks of the

regulation period might be too

restrictive. Concerns were again voiced

that the method for calculating

allotment base was not always a good

approximation of a handler’s historical

shipments during this 11-week period.

Based on the shipment data available for

the current season, and shipments from

past seasons, total weekly shipments of

red seedless grapefruit during the rest of

the regulatory period are expected to

exceed the average week calculated for

the industry of 976,782 cartons. There is

also some indication that shipments

during the remainder of the regulation

period may be greater than in past

seasons. With shipments running

higher, the committee concluded that

establishing a 30 percent weekly

percentage rate in combination with the

calculated average week would result in

available allotment of less than 30

percent of overall shipments.

The committee discussed the merits

of changing the established weekly

percentage rate for the last five weeks

from 30 percent to 35 percent. Such a

change represents an additional

industry allotment of less than 50,000

cartons. The effect on an individual

handler’s allotment would be minimal.

However, there was discussion that

such a change would provide some

additional flexibility for handlers.

In addition, having been operating

under a weekly percentage for several

weeks, members stated that the

regulation was being effective and

moving to a more restrictive level was

unnecessary. Members agreed that one

of the most important goals of this

regulation was to create some discipline

in the way fruit was picked and

marketed. Several individuals stated

that there are indications from the

current and past regulatory weeks that

maintaining the weekly percentage at 35

percent for the remainder of the 11

weeks would continue to accomplish

this goal.

The committee examined the

information on past shipments and on

the size distribution information

available for the current season. Based

on the size survey, 37.6 percent of the

crop is size 48 or 56. This amount was

somewhat larger than originally

expected, indicating that there was a

greater volume of smaller sizes than the

committee had anticipated. Considering

this, and the other information

discussed, the committee agreed that

establishing a weekly percentage of 35

percent for the remainder of the

regulated period would address the

goals of this regulation, while providing

handlers with some additional

flexibility.

The committee again included in its

deliberations that if crop and market

conditions should change, the

committee could recommend that the

percentages be increased or eliminated

to provide for the shipment of more

small sizes. The committee considered

the official crop estimate and the

information in the UF–IFAS study.

Committee members also discussed how

the crop was sizing. Using this

information on the 1997–98 crop, the

committee members believe that

establishing the weekly percentages as

recommended will provide enough

small sizes to supply those markets

without disrupting the markets for

larger sizes.

Under the procedures in section

905.153, the quantity of sizes 48 and/or

56 red seedless grapefruit that may be

shipped by a handler during a regulated

week is calculated using the

recommended percentage for that week.

By taking the established weekly

percentage times the average weekly

volume of red grapefruit handled by

such handler in the previous five

seasons, handlers can calculate the

volume of sizes 48 and/or 56 they may

ship in a regulated week.

An average week was calculated by

the committee for each handler using

the following formula. The total red

seedless grapefruit shipments by a

handler during the 33 week period

beginning the third Monday in

September and ending the first Sunday

in May during the previous five seasons

were added and divided by five to

establish an average season. This

average season was then divided by the

33 weeks in a season to derive the

average week. This average week is the

base for each handler for each of the 11

weeks contained in the regulation

period. The applicable weekly

percentage is then multiplied by a

handler’s average week. The total is that

handler’s allotment of sizes 48 and/or

56 red seedless grapefruit for the given

week.

Under this amended interim final

rule, the calculated allotment is the

amount of small sized red seedless

grapefruit a handler can ship. If the

minimum size established under section

905.52 remains at size 56, handlers can

fill their allotment with size 56, size 48,

or a combination of the two sizes such

that the total of these shipments are

within the established limits. If the

minimum size under the order is 48,

handlers can fill their allotment with

size 48 fruit such that the total of these

shipments are within the established

limits. The committee staff will perform

the specified calculations and provide

them to each handler.

To illustrate, suppose Handler A

shipped a total of 50,000 cartons, 64,600

cartons, 45,000 cartons, 79,500 cartons,

and 24,900 cartons of red seedless

grapefruit in the last five seasons,

respectively. Adding these season totals

and dividing by five yields an average

season of 52,800 cartons. The average

season is then divided by 33 weeks to

yield an average week, in this case,

1,600 cartons. This is handler A’s base.

Assuming the weekly percentage is 50

percent, this percentage is then applied

to the handler’s base. This provides this

handler with a weekly allotment of 800

cartons (1,600 × .50) of size 48 and/or

56.
Federal Register / Vol. 62, No. 210 / Thursday, October 30, 1997 / Rules and Regulations 58637

The average week for handlers with

less than five previous seasons of

shipments is calculated by the

committee by averaging the total

shipments for the seasons they did ship

red seedless grapefruit during the

immediately preceding five years and

dividing that average by 33. New

handlers with no record of shipments

have no prior period on which to base

their average week. Therefore, a new

handler can ship small sizes up to the

established weekly percentage as a

percentage of their total volume of

shipments during their first shipping

week. Once a new handler has

established shipments, their average

week is calculated as an average of the

weeks they have shipped during the

current season.

This amended interim final rule

establishes a weekly percentage of 35

percent for the last five weeks of the

regulatory period (October 5 through

November 30). Each regulation week

begins Monday at 12:00 a.m. and ends

at 11:59 p.m. the following Sunday,

since most handlers keep records based

on Monday being the beginning of the

work week. If necessary, the committee

can meet and recommend changes in

the percentages to the Secretary at any

time during the regulatory period.

The rules and regulations contain a

variety of provisions designed to

provide handlers with some marketing

flexibility. When regulation is

established by the Secretary for a given

week, the committee calculates the

quantity of small red seedless grapefruit

which may be handled by each handler.

Section 905.153(d) provides allowances

for overshipments, loans, and transfers

of allotment. These allowances should

allow handlers the opportunity to

supply their markets while limiting the

impact of small sizes on a weekly basis.

During any week for which the

Secretary has fixed the percentage of

sizes 48 and/or 56 red seedless

grapefruit, any handler can handle an

amount of sizes 48 and/or 56 red

seedless grapefruit not to exceed 110

percent of their allotment for that week.

The quantity of overshipments (the

amount shipped in excess of a handler’s

weekly allotment) will be deducted

from the handler’s allotment for the

following week. Overshipments are not

allowed during week 11 because there

are no allotments the following week

from which to deduct the

overshipments.

If handlers fail to use their entire

allotments in a given week, the amounts

undershipped will not be carried

forward to the following week.

However, a handler to whom an

allotment has been issued can lend or

transfer all or part of such allotment

(excluding the overshipment allowance)

to another handler. In the event of a

loan, each party will, prior to the

completion of the loan agreement, notify

the committee of the proposed loan and

date of repayment. If a transfer of

allotment is desired, each party will

promptly notify the committee so that

proper adjustments of the records can be

made. In each case, the committee will

confirm in writing all such transactions

prior to the following week. The

committee can also act on behalf of

handlers wanting to arrange allotment

loans or participate in the transfer of

allotment. Repayment of an allotment

loan is at the discretion of the handlers

party to the loan.

The committee computes each

handler’s allotment by multiplying the

handler’s average week by the

percentage established by regulation for

that week. The committee will notify

each handler prior to that particular

week of the quantity of sizes 48 and 56

red seedless grapefruit such handler can

handle during a particular week, making

the necessary adjustments for

overshipments and loan repayments.

This rule does not affect the provision

that handlers may ship up to 15

standard packed cartons (12 bushels) of

fruit per day exempt from regulatory

requirements. Fruit shipped in gift

packages that are individually

addressed and not for resale, and fruit

shipped for animal feed are also exempt

from handling requirements under

specific conditions. Also, fruit shipped

to commercial processors for conversion

into canned or frozen products or into

a beverage base are not subject to the

handling requirements under the order.

Section 8(e) of the Act requires that

whenever grade, size, quality or

maturity requirements are in effect for

certain commodities under a domestic

marketing order, including grapefruit,

imports of that commodity must meet

the same or comparable requirements.

This rule does not change the minimum

grade and size requirements under the

order, only the percentages of sizes 48

and/or 56 red grapefruit that may be

handled. Therefore, no change is

necessary in the grapefruit import

regulations as a result of this action.

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 80 handlers

subject to regulation under the order

and approximately 11,000 growers of

citrus in the regulated area. Small

agricultural service firms, which

includes handlers, have been defined by

the Small Business Administration

(SBA) (13 CFR 121.601) as those having

annual receipts of less than $5,000,000,

and small agricultural producers are

defined as those having annual receipts

of less than $500,000.

Based on the Florida Agricultural

Statistics Service and committee data

for the 1995–96 season, the average

annual f.o.b. price for fresh Florida red

grapefruit during the 1995–96 season

was $5.00 per 4⁄5 bushel cartons for all

grapefruit shipments, and the total

shipments for the 1995–96 season were

23 million cartons of grapefruit.

Approximately 20 percent of all

handlers handled 60 percent of Florida

grapefruit shipments. In addition, many

of these handlers ship other citrus fruit

and products which are not included in

committee data but would contribute

further to handler receipts. Using the

average f.o.b. price, about 80 percent of

grapefruit handlers could be considered

small businesses under SBA’s definition

and about 20 percent of the handlers

could be considered large businesses.

The majority of Florida grapefruit

handlers, and growers may be classified

as small entities.

The committee believes that the over

shipment of smaller sized red seedless

grapefruit early in the season has

contributed to below production cost

returns for growers and lower on tree

values. For the past few seasons, returns

on red seedless grapefruit have been at

all time lows, often not returning the

cost of production. On tree prices for

red seedless grapefruit have declined

steadily from $9.60 per box during the

1989–90 season, to $3.11 per box during

the 1992–93 season, to $1.82 per box

during the 1994–95 season, to $1.55 per

box during the 1996–97 season. The

committee believes that to stabilize the

market and improve returns to growers,

demand for fresh red seedless grapefruit

must be stabilized and increased.

Under the authority of section 905.52

of the order, this amended interim final

rule limits the volume of small red

seedless grapefruit entering the fresh

market for each week of the 5 week

period beginning the week of October
58638 Federal Register / Vol. 62, No. 210 / Thursday, October 30, 1997 / Rules and Regulations

27. The rule limits the volume of sizes

48 and/or 56 red seedless grapefruit by

establishing the weekly percentages at

35 percent for the last five weeks of the

regulatory period (October 27 through

November 30). Under such a limitation,

the quantity of sizes 48 and/or 56 red

seedless grapefruit that may be shipped

by a handler during a particular week is

calculated using the recommended

percentage. By taking the recommended

percentage times the average weekly

volume of red grapefruit handled by

such handler in the previous five

seasons, the committee calculates a

handler’s weekly allotment of small

sizes. This rule provides a supply of

small sized red seedless grapefruit

sufficient to meet market demand,

without saturating all markets with

these small sizes. This rule is necessary

to help stabilize the market and improve

grower returns.

At the May 28, 1997, meeting, the

committee recommended that the

percentage for each of the 11 weeks be

established at the 25 percent level. They

reasoned that this percentage, when

combined with the average weekly

shipments for the total industry, would

provide a total industry allotment of

244,195 cartons of sizes 48 and/or 56

red seedless grapefruit per regulated

week. This percentage would have

allowed total shipments of small red

seedless grapefruit to approach the

250,000 carton mark during regulated

weeks without exceeding it.

At the May 28, 1997, meeting, there

was discussion regarding the expected

impact of this change on handlers and

growers in terms of cost. Discussion

focused on the possibility that market

share could be lost to Texas and that

this rule could increase packinghouse

costs. According to EAB, limiting

shipments of small Florida grapefruit

probably will not result in a major shift

to Texas grapefruit because the Texas

industry is much smaller and has higher

freight costs to some markets supplied

by Florida. The UF–IFAS study made

similar findings. Texas production is

much smaller and has been susceptible

to freezes that take it out of the market.

This has lessened its impact on the

overall grapefruit market.

The concern about packinghouse

costs was that volume regulation could

mean lower packouts which may

increase cost. However, the availability

of loans and transfers provides some

flexibility. Also, this rule only affects

small sizes and only during the 11 week

period. By substituting larger sizes and

using loans and transfers, packouts

should approach the weekly volume of

seasons prior to this rule.

A weekly percentage of 25 percent,

when combined with the average

weekly shipments for the total industry,

would provide a total industry

allotment of 244,195 cartons of sizes 48

and/or 56 red seedless grapefruit. Based

on shipments from the past four

seasons, a total available allotment of

244,195 cartons would exceed actual

shipments for each of the first three

weeks regulated under this rule.

In addition, if a 25 percent restriction

on small sizes had been applied during

the 11 week period in the three seasons

prior to last season, an average of 4.2

percent of overall shipments during that

period would have been affected. The

September 12, 1997, interim final rule

affected even fewer shipments by

establishing less restrictive weekly

percentages. In addition, a large

percentage of this volume most likely

could have been replaced by larger

sizes. Under that action a sufficient

volume of small sized red grapefruit is

still allowed into all channels of trade,

and allowances are in place to help

handlers address any market shortfall.

Therefore, the overall impact on total

seasonal shipments and on industry cost

should be minimal.

The committee also discussed the

state of the market and the cost of doing

nothing. During the past three seasons,

sizes 48 and 56 accounted for 34 percent

of total shipments during the 11 week

regulatory period, with the average

weekly percentage exceeding 40 percent

of shipments. For the remainder of the

season, sizes 48 and 56 represent only

26 percent of total shipments. While

there is a market for early grapefruit, the

shipment of large quantities of small red

seedless grapefruit in a short period

oversupplies the fresh market for these

sizes and negatively impacts the market

for all sizes.

The early season crop tends to have

a greater percentage of small sizes. The

large volume of smaller, lower priced

fruit drives down the price for all sizes.

Early in the season, larger sized fruit

commands a premium price. In some

cases, the f.o.b. is $4 to $6 a carton more

than for the smaller sizes. In early

October, the f.o.b. for a size 27 averages

around $10.00 per carton. This

compares to an average f.o.b. of $5.50

per carton for size 56. By the end of the

11 week period outlined in this rule, the

f.o.b. for large sizes has dropped to

within two dollars of the price for small

sizes.

In the past three seasons, during the

period covered by this rule, prices of red

seedless grapefruit have fallen from a

weighted average f.o.b. of $7.80 per

carton to an average f.o.b. of $5.50 per

carton. Even though later in the season

the crop has sized to naturally limit the

amount of smaller sizes available for

shipment, the price structure in the

market has already been negatively

affected. This leaves the f.o.b. for all

sizes around $5.00 to $6.00 per carton

for the rest of the season.

As previously stated, the on tree price

of red seedless grapefruit has also been

falling. On tree prices for fresh red

seedless grapefruit have declined

steadily from $9.60 per box during the

1989–90 season, to $3.11 per box during

the 1992–93 season, to $1.82 per box

during the 1994–95 season, to $1.55 per

box during the 1996–97 season. In many

cases, prices during the past two

seasons have provided returns less than

production costs. This price reduction

could force many small growers out of

business. If no action is taken, the UF–

IFAS study indicates that on tree returns

will remain at levels around $1.50.

The September 12, 1997, interim final

rule provided a supply of small sized

red seedless grapefruit to meet market

demand, without saturating all markets

with these small sizes. The committee

believes that if the supply of small sizes

were limited early in the season, prices

can be stabilized at a higher level. This

provides increased returns for growers.

In addition, if more small grapefruit

were allowed to remain on the tree to

increase in size and maturity, it could

provide greater returns to growers.

The committee surveyed shipment

data covering the 11 week regulatory

period for the last four seasons and

examined tables outlining weekly f.o.b.

figures for each size. The committee

believed that if shipments of small sizes

can be maintained at around 250,000

cartons a week, prices should stabilize

and demand for larger, more profitable

sizes should increase. The established

weekly percentages, when combined

with the average weekly shipments for

the total industry, should help maintain

industry shipments of sizes 48 and/or

56 red seedless grapefruit at quantities

close to the 250,000 carton level per

regulated week. A stabilized price that

returns a fair market value benefits both

small and large growers and handlers.

The 11-week volume regulation may

require more selective picking of only

the sizes desired, something that many

growers are doing already. The UF–

IFAS study indicated that returns could

increase if growers harvest selectively

and return to repick groves as the

grapefruit sized. This also allows

growers to maximize returns on fresh

grapefruit by not picking unprofitable

grades and sizes of red grapefruit that

are sent to the less profitable processing

market. The study indicated that

selective harvesting can reduce the f.o.b.
Federal Register / Vol. 62, No. 210 / Thursday, October 30, 1997 / Rules and Regulations 58639

cost per carton. The study also indicates

that increasing minimum size

restrictions could help to raise returns.

Fifty-nine percent of red seedless

grapefruit is shipped to fresh market

channels. There is a processing outlet

for grapefruit not sold into the fresh

market. However, the vast majority of

processing is squeezing the grapefruit

for juice. Because of the properties of

the juice of red seedless grapefruit,

including problems with color, the

processing outlet is limited, and not

currently profitable. Therefore, it is

essential that the market for fresh red

grapefruit be fostered and maintained.

Any costs associated with this action are

only for the 11 week regulatory period.

However, benefits from this action

could stretch throughout the entire 33

week season. Even if this action was

successful only in raising returns a few

pennies a carton, when applied to 34

million cartons of red seedless

grapefruit shipped to the fresh market,

the benefits should more than outweigh

the costs.

The limits established in the weekly

volume regulation are based on

percentages applied to a handler’s

average week. This process was

established by the committee because it

was the most equitable. All handlers

have access to loans and transfers.

Handlers and growers both will benefit

from increased returns. The costs or

benefits of this rule are not expected to

be disproportionately more or less for

small handlers or growers than for larger

entities.

The committee discussed alternatives

to the recommended volume regulation.

The committee discussed eliminating

shipments of size 56 grapefruit all

together. Several members expressed

that there is a market for size 56

grapefruit. Members favored the

percentage rule recommended because

it supplies a sufficient quantity of small

sizes should there be a demand for size

56. Therefore, the motion to eliminate

size 56 was rejected. Another alternative

discussed was to do nothing. However,

the committee rejected this option,

taking in account that returns would

remain stagnant without action. Thus,

the majority of committee members

agreed that weekly percentages should

be established as recommended for the

shipment of small sized red seedless

grapefruit for the 11 week period

beginning September 15, 1997.

The committee met again August 26,

1997, and revisited the weekly

percentage issue. The committee

recommended that the weekly

percentages be set to 50 percent for the

first three weeks (September 15 through

October 5), 35 percent for the next three

weeks (October 6 through October 26),

and 30 percent for the remainder of the

11 weeks.

In the discussion of that change, the

committee reviewed the initial and the

revised percentages recommended, the

current state of the crop, and shipping

information from past seasons. The

committee recognized that in terms of

available allotment, even establishing a

weekly percentage of 25 percent for the

first three regulated weeks would not be

restrictive. Shipment data from the past

four seasons indicate that available

allotment under a 25 percent restriction

would have exceeded actual shipments

for each of the first three weeks that

were regulated under the September 12,

1997, rule.

The committee determined that if

available allotment would have

exceeded shipments for the first three

weeks even when establishing a

percentage of 25 percent, it would give

individual handlers greater flexibility

during these three weeks to establish the

percentage at 50 percent. They argued

that this would provide each handler

with additional allotment during these

three weeks, reducing the number of

loans and transfers needed to utilize the

available allotment, yet having little or

no affect on the volume of small sizes.

The committee also agreed that setting

the percentage at 50 percent would still

provide some restriction should

shipments for this period this season

exceed past quantities.

For the remainder of the 11 weeks, the

committee believed that the weekly

percentage needed to be tighter than 50

percent which would impose nearly no

restriction but greater than 25 percent.

The issue was raised regarding the

possible market impact when small

sizes exceed 250,000 cartons in a week.

The committee recognized that ideally,

244,195 cartons of red seedless

grapefruit would be available to the

industry for each of the 11 weeks if the

percentage was set at 25 percent.

However, the committee was concerned

that the true amount available would be

lower. Several members stated that

setting a weekly percentage at 25

percent to approximate the 250,000

cartons was based on total utilization of

allotment, and that assumption was

unreasonable. The committee agreed

that loans and transfers are beneficial,

but that even with their availability a

percentage of allotment would most

likely not be used.

At the August 27, 1997, meeting,

several other members raised concerns

about focusing too much on total

allotment available, rather than on

allotment per handler. Members

concurred that the season for red

seedless grapefruit is approximately 33

weeks. However, this did not mean that

every handler was shipping during all

33 weeks. Using 33 weeks to divide an

average season to calculate an average

week often resulted in amounts lower

than their actual weekly shipments

because they were not shipping during

all 33 weeks. They stated that applying

a 25 percent restriction regulated them

at a level closer to 15 percent of their

actual shipments during the regulation

period.

Based on this discussion, the

committee thought a weekly percentage

of 35 percent for the regulation weeks

October 6 through October 26 would be

a more appropriate level. They believe

that because total allotment will not be

fully utilized and the way individual

handlers are affected, this level would

provide a sufficient supply of small

sizes without overly exceeding amounts

that would negatively affect other

markets.

The committee further recommended

at the August 27, 1997, meeting, that the

weekly percentage for the remainder of

the 11 weeks be established at 30

percent. The committee resolved that

moving into the last five weeks of

regulation, a tighter percentage was

desirable. The committee believed that

as the industry moves into the season

and shipments increase, a weekly

percentage of 30 percent would provide

the best balance between supply and

demand for small sized red seedless

grapefruit.

However, on October 14, 1997, the

committee met again and recommended

a further revision to the weekly

percentages. The committee

recommended that the weekly

percentages for the last five weeks of the

regulatory period be changed from 30

percent to 35 percent. In its discussion

of this change, the committee reviewed

the initial percentages recommended

and the current state of the crop.

The committee also reviewed some

new information regarding this season

that was not available during its earlier

meetings. On October 10, 1997, the

Department released its crop estimate

for Florida grapefruit. The estimate for

total Florida grapefruit was 54 million

boxes, a 3.2 percent reduction from last

season. In addition, the committee was

provided information regarding size

distribution developed from a

September size survey. This survey was

conducted by the Department and

showed a larger percentage of small

sizes than anticipated. The committee

also had the benefit of having operated

several weeks under a weekly

percentage regulation.
58640 Federal Register / Vol. 62, No. 210 / Thursday, October 30, 1997 / Rules and Regulations

There were many comments by those

attending the meeting that the use of the

weekly percentage rule was being

effective. Members stated that the rule

was having a positive effect on the

market and on returns. Overall

committee support for the regulation

had increased.

The committee considered that the 30

percent weekly percentage rate for the

last five weeks of the regulation period

may be too restrictive. Reviewing

shipment data for the beginning weeks

of this season and shipments from past

seasons, the committee determined that

total weekly shipments during the rest

of the regulatory period would exceed

the average week calculated for the

industry of 976,782 cartons. There was

also some discussion that shipments

during the remainder of the regulation

period may be greater than in past

seasons. The committee considered that

with shipments running higher,

establishing a 30 percent weekly

percentage rate in combination with the

calculated average week would actually

be establishing a rate more restrictive

than 30 percent of overall shipments.

The committee discussed the merits

of changing the established weekly

percentage rate for the last five weeks

from 30 percent to 35 percent. Such a

change represents an additional

industry allotment of less than 50,000

cartons, and should have a minimal

impact when distributed to individual

handlers. However, members thought

that an increase would provide some

additional flexibility for handlers.

In addition, having been operating

under a weekly percentage for several

weeks, members stated that the

regulation was being effective and

moving to a more restrictive level was

unnecessary. Members agreed that one

of the most important goals of this

regulation was to create some discipline

in the way fruit was picked and

marketed. Committee members believed

that maintaining the weekly percentage

at 35 percent for the remainder of the 11

weeks would continue to accomplish

this goal.

The committee examined the

information on past shipments and on

the size distribution information

available for the current season. Based

on the size survey, 37.6 percent of the

crop is size 48 or 56. This amount was

somewhat larger than anticipated,

indicating that there were more smaller

sized red grapefruit than the committee

had originally thought. Considering this,

and the other information discussed, the

committee agreed that establishing a

weekly percentage of 35 percent for the

remainder of the regulated period would

address the goals of this regulation,

while providing handlers with some

additional flexibility.

This rule changes the requirements

under the Florida citrus marketing

order. Handlers utilizing the flexibility

of the loan and transfer aspects of this

action are required to submit a form to

the committee. The rule increases the

reporting burden on approximately 80

handlers of red seedless grapefruit who

will be taking about 0.03 hour to

complete each report regarding

allotment loans or transfers. The

information collection requirements

contained in this section have been

approved by the Office of Management

and Budget (OMB) under the provisions

of the Paperwork Reduction Act of 1995

(44 U.S.C. Chapter 35) and assigned

OMB number 0581–0094. 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.

The Department has not identified

any relevant Federal rules that

duplicate, overlap or conflict with this

rule.

However, red seedless grapefruit must

meet the requirements as specified in

the U.S. Standards for Grades of Florida

Grapefruit (7 CFR 51.760 through

51.784) issued under the Agricultural

Marketing Act of 1946 (7 U.S.C. 1621

through 1627). Further, the public

comments received concerning the

proposed rule and previous interim

final rule relative to this action did not

address the initial regulatory flexibility

analysis.

In addition, the committee meetings

were widely publicized throughout the

citrus industry and all interested

persons were invited to attend the

meeting and participate in committee

deliberations on all issues. Like all

committee meetings, the May 28, 1997,

meeting, the August 26, 1997, meeting,

and the October 14, 1997, meeting were

public meetings and all entities, both

large and small, were able to express

views on this issue.

A proposed rule concerning this

action was published in the Federal

Register on Tuesday, July 29, 1997 (62

FR 40482). A 15-day comment period

was provided to allow interested

persons to respond to the proposal.

Thirty five comments were received. An

interim final rule concerning this action

was published in the Federal Register

on Friday, September 12, 1997 (62 FR

47913). Copies of both rules were

mailed or sent via facsimile to all

committee members and to grapefruit

growers and handlers. The rules were

also made available through the Internet

by the Office of the Federal Register.

The 35 comments to the proposed

rule were addressed in the interim final

rule published in the Federal Register

on Friday, September 12, 1997 (62 FR

47913).

In the September 12, 1997, interim

final rule, a 10-day comment period was

provided to allow interested persons to

respond to the rule. A 10-day period

was deemed appropriate because the

rule needed to be in place as soon as

possible since handlers began shipping

grapefruit in September. The comment

period ended September 22, 1997. One

comment was received.

As previously stated, subsequent to

the end of the comment period, the

committee met and recommended

modifying its recommendation. The

committee recommended that the

weekly percentages be changed from 50

percent for the first three weeks

(September 15 through October 5), 35

percent for the next three weeks

(October 6 through October 26), and 30

percent for the remainder of the 11

weeks as specified in the interim final

rule published in September, to 50

percent for the first three weeks

(September 15 through October 5), and

35 percent for the remainder of the 11

weeks.

Because of this recommendation, the

Department has determined that

interested parties should be provided

the opportunity to comment on the

changes to the interim final rule

currently in effect. The Department

further believes that extending the

comment period with no changes in the

percentages in effect limiting the

shipments of small red seedless

grapefruit during the period of

regulation would be detrimental to the

industry. Therefore, the Department is

amending the current regulations on

small red seedless grapefruit through

this interim final rule which will allow

10 additional days to comment. The

discussion of the comment received in

response to the previous interim final

rule follows.

One comment was received in

opposition to the interim final rule. The

comment opposed the rule because in

past seasons their house packed only

white grapefruit. However, this season,

they were able to identify a market for

red grapefruit. The comment further

stated that because they have no

shipments of record for red seedless

grapefruit for previous seasons, they

have no allotment base.

In establishing procedures by which

to limit the percentage of small sized

red seedless grapefruit entering the fresh

market, the committee envisioned just

such a situation, and included

provisions to address it. The committee
Federal Register / Vol. 62, No. 210 / Thursday, October 30, 1997 / Rules and Regulations 58641

recognized that new handlers with no

record of shipments have no prior

period on which to base their average

week. Therefore, under the procedures

established in section 905.153, a new

handler can ship small sizes up to the

established weekly percentage as a

percentage of their total volume of

shipments during their first shipping

week. Once a new handler has

established shipments, their average

week is calculated as an average of the

weeks they have shipped during the

current season.

In addition, the weekly percentage

regulation only applies to sizes 48 and/

or 56 red seedless grapefruit. There are

no volume restrictions on shipments of

larger sized red seedless grapefruit that

meet the minimum grade and size

requirements under the order.

The commenter further stated that he

did not believe that they would have

access to transfers or loans. The transfer

and loan procedures do not exclude any

handler. It is the handler’s

responsibility to contact other handlers

to locate available allotment. The

committee staff is available to provide

some assistance with locating available

allotment. At its October meeting, the

committee discussed the transfer and

loan procedure. The procedures are

being utilized, and based on comments,

those seeking additional allotment have,

in most cases, been able to acquire it

through loans or transfers.

After analyzing the comment received

and other available information,

including the additional

recommendation by the committee, the

Department has concluded that this

interim final rule is appropriate.

A 10-day comment period is provided

to allow interested persons to respond

to this proposal. A 10-day period is

deemed appropriate because this action

amends the weekly regulation period

beginning on October 27, through

November 30, 1997. Adequate time will

be necessary so that any changes, if

necessary, can be made to the

regulations before the end of the five

week period. All written comments

timely received will be considered

before a final determination is made on

this matter.

After consideration of all relevant

matter presented, including the

information and recommendations

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.

It is further found and determined

upon good cause that it is impracticable,

unnecessary, and contrary to the public

intent 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

(5 U.S.C. 553) because this rule needs to

be in place since handlers have already

begun shipping grapefruit. This rule is

necessary to help stabilize the market

and to improve grower returns. Further,

handlers are aware of this rule, which

was recommended at public meetings.

This action amends the weekly

regulation beginning October 27, 1997.

Also, a 15-day comment period was

provided for in the proposed rule, an

additional 10-day comment period was

provided for in the interim final rule,

and an addition 10-day comment period

is provided for in this amended interim

final rule.

List of Subjects in 7 CFR Part 905

Grapefruit, Marketing agreements,

Oranges, Reporting and recordkeeping

requirements, Tangelos, Tangerines.

For the reasons set forth in the

preamble, 7 CFR part 905 is amended as

follows:

PART 905—ORANGES, GRAPEFRUIT,

TANGERINES, AND TANGELOS

GROWN IN FLORIDA

1. The authority citation for 7 CFR

part 905 continues to read as follows:

Authority: 7 U.S.C. 601–674.

2. Section 905.601 is revised to read

as follows:

§ 905.601 Red seedless grapefruit

regulation 101.

The schedule below establishes the

weekly percentages to be used to

calculate each handler’s weekly

allotment of small sizes. If the minimum

size in effect under section 905.306 for

red seedless grapefruit is size 56,

handlers can fill their allotment with

size 56, size 48, or a combination of the

two sizes such that the total of these

shipments are within the established

weekly limits. If the minimum size in

effect under section 905.306 for red

seedless grapefruit is 48, handlers can

fill their allotment with size 48 red

seedless grapefruit such that the total of

these shipments are within the

established weekly limits. The weekly

percentages for sizes 48 and/or 56 red

seedless grapefruit grown in Florida,

which may be handled during the

specified weeks are as follows:

Week

Weekly

percentage

(a) 9/15/97 through 9/21/97 ............ 50

(b) 9/22/97 through 9/28/97 ............ 50

(c) 9/29/97 through 10/5/97 ............ 50

Week

Weekly

percentage

(d) 10/6/97 through 10/12/97 .......... 35

(e) 10/13/97 through 10/19/97 ........ 35

(f) 10/20/97 through 10/26/97 ......... 35

(g) 10/27/97 through 11/2/97 .......... 35

(h) 11/3/97 through 11/9/97 ............ 35

(i) 11/10/97 through 11/16/97 ......... 35

(j) 11/17/97 through 11/23/97 ......... 35

(k) 11/24/97 through 11/30/97 ........ 35

Dated: October 23, 1997.

Robert C. Keeney,

Deputy Administrator, Fruit and Vegetable

Programs.

[FR Doc. 97–28823 Filed 10–27–97; 3:42 pm]

BILLING CODE 3410–02–P

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 984

[Docket No. FV97–984–1 IFR]

Walnuts Grown in California;

Decreased Assessment Rate

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Interim final rule with request

for comments.

SUMMARY: This interim final rule

decreases the assessment rate

established for the Walnut Marketing

Board (Board) under Marketing Order

No. 984 for the 1997–98 and subsequent

marketing years. The Board is

responsible for local administration of

the marketing order which regulates the

handling of walnuts grown in

California. Authorization to assess

walnut handlers enables the Board to

incur expenses that are reasonable and

necessary to administer the program.

The 1997–98 marketing year covers the

period August 1 through July 31. The

assessment rate will continue in effect

indefinitely unless modified,

suspended, or terminated.

DATES: Effective October 31, 1997.

Comments received by December 29,

1997, 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 in triplicate to the Docket Clerk,

Fruit and Vegetable Programs, AMS,

USDA, Room 2525–S, P.O. Box 96456,

Washington, DC 20090–6456; Fax: (202)

720–5698. Comments should reference

the docket number and the date and

page number of this issue of the Federal

Register and will be available for public