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

12702 

Vol. 75, No. 51 

Wednesday, March 17, 2010 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 930 

[Doc. No. AMS–FV–0069; FV09–930–2 PR] 

Tart Cherries Grown in the States of 

Michigan, et al.; Final Free and 

Restricted Percentages for the 2009– 

2010 Crop Year for Tart Cherries 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Proposed rule. 

SUMMARY: This rule invites comments 

on the establishment of final free and 

restricted percentages for the 2009–2010 

crop year. The percentages are 32 

percent free and 68 percent restricted 

and will establish the proportion of 

cherries from the 2009 crop which may 

be handled in commercial outlets. The 

percentages are intended to stabilize 

supplies and prices, and strengthen 

market conditions. The percentages 

were recommended by the Cherry 

Industry Administrative Board (Board), 

the body that locally administers the 

marketing order. The marketing order 

regulates the handling of tart cherries 

grown in the States of Michigan, New 

York, Pennsylvania, Oregon, Utah, 

Washington, and Wisconsin. 

DATES: Comments must be received by 

April 1, 2010. 

ADDRESSES: Interested persons are 

invited to submit written comments 

concerning this rule. Comments must be 

sent to the Docket Clerk, Marketing 

Order Administration Branch, Fruit and 

Vegetable Programs, AMS, USDA, 1400 

Independence Avenue, SW., STOP 

0237, Washington, DC 20250–0237; Fax: 

(202) 720–8938, or Internet: http:// 

www.regulations.gov. All comments 

should reference the docket number and 

the date and page number of this issue 

of the Federal Register and will be 

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 

rule 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: 

Patricia A. Petrella or Kenneth G. 

Johnson, Marketing Order 

Administration Branch, Fruit and 

Vegetable Programs, AMS, USDA, Unit 

155, 4700 River Road, Riverdale, MD 

20737; telephone: (301) 734–5243, Fax: 

(301) 734–5275; E-mail 

Patricia.Petrella@ams.usda.gov or 

Kenneth.Johnson@ams.usda.gov. 

Small businesses may request 

information on complying with this 

regulation by contacting Antoinette 

Carter, Marketing Order Administration 

Branch, Fruit and Vegetable Programs, 

AMS, USDA, 1400 Independence 

Avenue, SW., STOP 0237, Washington, 

DC 20250–0237; telephone: (202) 720– 

2491, Fax: (202) 720–8938, or E-mail: 

Antoinette.Carter@ams.usda.gov. 

SUPPLEMENTARY INFORMATION: This 

proposed rule is issued under Marketing 

Agreement and Order No. 930 (7 CFR 

part 930), regulating the handling of tart 

cherries produced in the States of 

Michigan, New York, Pennsylvania, 

Oregon, Utah, Washington, and 

Wisconsin, 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 

(Department) is issuing this rule in 

conformance with Executive Order 

12866. 

This proposal has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. Under the marketing 

order provisions now in effect, final free 

and restricted percentages may be 

established for tart cherries handled by 

handlers during the crop year. This 

proposed rule would establish final free 

and restricted percentages for tart 

cherries for the 2009–2010 crop year, 

beginning July 1, 2009, through June 30, 

2010. 

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 exempt therefrom. Such 

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 in 

equity to review the Secretary’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 order prescribes procedures for 

computing an optimum supply and 

preliminary and final percentages that 

establish the amount of tart cherries that 

can be marketed throughout the season. 

The regulations apply to all handlers of 

tart cherries that are in the regulated 

districts. Tart cherries in the free 

percentage category may be shipped 

immediately to any market, while 

restricted percentage tart cherries must 

be held by handlers in a primary or 

secondary reserve, or be diverted in 

accordance with § 930.59 of the order 

and § 930.159 of the regulations, or used 

for exempt purposes (to obtain diversion 

credit) under § 930.62 of the order and 

§ 930.162 of the regulations. The 

regulated Districts for this season are: 

District one—Northern Michigan; 

District two—Central Michigan; District 

three—Southern Michigan; District 

four—New York; District seven—Utah; 

and District eight—Washington. 

Districts five, six and nine (Oregon, 

Pennsylvania, and Wisconsin, 

respectively) will not be regulated for 

the 2009–2010 season. 

The order prescribes under § 930.52 

that those districts to be regulated shall 

be those districts in which the average 

annual production of cherries over the 

prior three years has exceeded six 

million pounds. A district not meeting 

the six million-pound requirement shall 

not be regulated in such crop year. 

Because this requirement was not met in 

the Districts of Oregon, Pennsylvania, 

and Wisconsin handlers in those 

districts would not be subject to volume 

regulation during the 2009–2010 crop 

year. 

Demand for tart cherries at the farm 

level is derived from the demand for tart 

cherry products at retail. Demand for 

tart cherries and tart cherry products 


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tend to be relatively stable from year to 

year. The supply of tart cherries, by 

contrast, varies greatly from crop year to 

crop year. The magnitude of annual 

fluctuations in tart cherry supplies is 

one of the most pronounced for any 

agricultural commodity in the United 

States. In addition, since tart cherries 

are processed either into cans or frozen, 

they can be stored and carried over from 

crop year to crop year. This creates 

substantial coordination and marketing 

problems. The supply and demand for 

tart cherries is rarely balanced. The 

primary purpose of setting free and 

restricted percentages is to balance 

supply with demand and reduce large 

surpluses that may occur. 

Section 930.50(a) of the order 

prescribes procedures for computing an 

optimum supply for each crop year. The 

Board must meet on or about July 1 of 

each crop year, to review sales data, 

inventory data, current crop forecasts 

and market conditions. The optimum 

supply volume shall be calculated as 

100 percent of the average sales of the 

prior three years to which is added a 

desirable carryout inventory not to 

exceed 20 million pounds or such other 

amount as may be established with the 

approval of the Secretary. The optimum 

supply represents the desirable volume 

of tart cherries that should be available 

for sale in the coming crop year. 

The order also provides that on or 

about July 1 of each crop year, the Board 

is required to establish preliminary free 

and restricted percentages. These 

percentages are computed by deducting 

the actual carryin inventory from the 

optimum supply figure (adjusted to raw 

product equivalent—the actual weight 

of cherries handled to process into 

cherry products) and subtracting that 

figure from the current year’s USDA 

crop forecast or from an average of such 

other crop estimates the Board votes to 

use. If the resulting number is positive, 

this represents the estimated overproduction, which would be the 

restricted percentage tonnage. The 

restricted percentage tonnage is then 

divided by the sum of the crop estimates 

for the regulated districts to obtain 

percentages for the regulated districts. 

The Board is required to establish a 

preliminary restricted percentage equal 

to the quotient, rounded to the nearest 

whole number, with the complement 

being the preliminary free tonnage 

percentage. If the tonnage requirements 

for the year are more than the USDA 

crop forecast, the Board is required to 

establish a preliminary free tonnage 

percentage of 100 percent and a 

preliminary restricted percentage of 

zero. The Board is required to announce 

the preliminary percentages in 

accordance with paragraph (h) of 

§ 930.50. 

The Board met on June 18, 2009, and 

computed, for the 2009–2010 crop year, 

an optimum supply of 183 million 

pounds. The Board recommended that 

the desirable carryout figure be zero 

pounds. Desirable carryout is the 

amount of fruit required to be carried 

into the succeeding crop year and is set 

by the Board after considering market 

circumstances and needs. This figure 

can range from zero to a maximum of 20 

million pounds. 

The Board calculated preliminary free 

and restricted percentages as follows: 

The USDA estimate of the crop for the 

entire production area was 284 million 

pounds; a 31 million pound carryin 

(based on Board estimates) was 

subtracted from the optimum supply of 

183 million pounds which resulted in 

the 2009–2010 poundage requirements 

(adjusted optimum supply) of 152 

million pounds. The carryin figure 

reflects the amount of cherries that 

handlers actually have in inventory at 

the beginning of the 2008–2009 crop 

year. Subtracting the adjusted optimum 

supply of 152 million pounds from the 

USDA crop estimate, (284 million 

pounds) results in a surplus of 131 

million pounds of tart cherries. The 

surplus was divided by the production 

in the regulated districts (269 million 

pounds) and resulted in a restricted 

percentage of 49 percent for the 2009– 

2010 crop year. The free percentage was 

51 percent (100 percent minus 49 

percent). The Board established these 

percentages and announced them to the 

industry as required by the order. 

The preliminary percentages were 

based on the USDA production estimate 

and the following supply and demand 

information available at the June 

meeting for the 2009–2010 year: 

Millions of 

pounds 

Optimum Supply Formula: 

(1) Average sales of the prior three years ................................................................................................................................... 183 

(2) Plus desirable carryout ........................................................................................................................................................... 0 

(3) Optimum supply calculated by the Board at the June meeting ............................................................................................. 183 

Preliminary Percentages: 

(4) USDA crop estimate ............................................................................................................................................................... 284 

(5) Carryin held by handlers as of July 1, 2008 .......................................................................................................................... 31 

(6) Adjusted optimum supply for current crop year ..................................................................................................................... 152 

(7) Surplus .................................................................................................................................................................................... 131 

(8) USDA crop estimate for regulated districts ............................................................................................................................ 269 

Free Restricted 

(9) Preliminary percentages (item 7 divided by item 8 × 100 equals restricted percentage; 100 minus restricted percentage equals free percentage) ................................................................................................ 51 49 

Between July 1 and September 15 of 

each crop year, the Board may modify 

the preliminary free and restricted 

percentages by announcing interim free 

and restricted percentages to adjust to 

the actual pack occurring in the 

industry. No later than September 15, 

the Board must recommend final free 

and restricted percentages to the 

Secretary. 

The Secretary establishes final free 

and restricted percentages through the 

informal rulemaking process. These 

percentages would make available the 

tart cherries necessary to achieve the 

optimum supply figure calculated by 

the Board. The difference between any 

final free percentage and 100 percent is 

the final restricted percentage. The 

Board met on September 10, 2009, to 

recommend final free and restricted 

percentages. 

The actual production reported by the 

Board was 355 million pounds, which is 

a 71 million pound increase from the 

USDA crop estimate of 284 million 

pounds. The Board adjusted the 

optimum supply figure from 183 million 

pounds calculated for preliminary 

percentages to 176 million pounds 


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when calculating the final percentages. 

This adjustment was made because the 

sales figure for June 2009, which is used 

to compute three-year average sales, was 

estimated for preliminary percentages, 

but was based on actual numbers for 

final percentages. 

A 52 million pound carryin (based on 

handler reports) was subtracted from the 

optimum supply of 176 million pounds 

which resulted in the 2009–2010 

poundage requirements (adjusted 

optimum supply) of 124 million 

pounds. Subtracting the adjusted 

optimum supply of 124 million pounds 

from the USDA crop estimate (355 

million pounds), results in a surplus of 

231 million pounds of tart cherries. The 

surplus was divided by the production 

in the regulated districts (338 million 

pounds) and resulted in a restricted 

percentage of 68 percent for the 2009– 

2010 crop year. The free percentage was 

32 percent (100 percent minus 68 

percent). 

The final percentages are based on the 

Board’s reported production figures and 

the following supply and demand 

information available in September for 

the 2009–2010 crop year: 

Millions of 

pounds 

Optimum Supply Formula: 

(1) Average sales of the prior three years ................................................................................................................................... 176 

(2) Plus desirable carryout ........................................................................................................................................................... 0 

(3) Optimum supply calculated by the Board ............................................................................................................................... 176 

Final Percentages: 

(4) Board reported production ...................................................................................................................................................... 355 

(5) Plus carryin held by handlers as of July 1, 2009 ................................................................................................................... 52 

(6) Tonnage available for current crop year ................................................................................................................................ 407 

(7) Surplus (item 6 minus item 3) ................................................................................................................................................ 231 

(8) Production in regulated districts ............................................................................................................................................. 338 

Percentages 

Free Restricted 

(9) Final Percentages (item 7 divided by item 8 × 100 equals restricted percentage; 100 minus restricted 

percentage equals free percentage) ............................................................................................................. 32 68 

The USDA’s ‘‘Guidelines for Fruit, 

Vegetable, and Specialty Crop 

Marketing Orders’’ specify that 110 

percent of recent years’ sales should be 

made available to primary markets each 

season before recommendations for 

volume regulation are approved. This 

goal would be met by the establishment 

of a preliminary percentage which 

releases 100 percent of the optimum 

supply and the additional release of tart 

cherries provided under § 930.50(g). 

This release of tonnage, equal to 10 

percent of the average sales of the prior 

three years sales, is made available to 

handlers each season. The Board 

recommended that such release should 

be made available to handlers the first 

week of December and the first week of 

May. Handlers can decide how much of 

the 10 percent release they would like 

to receive on the December and May 

release dates. Once released, such 

cherries are released for free use by such 

handler. Approximately 18 million 

pounds would be made available to 

handlers this season in accordance with 

Department Guidelines. This release 

would be made available to every 

handler and released to such handler in 

proportion to the handler’s percentage 

of the total regulated crop handled. If a 

handler does not take his/her 

proportionate amount, such amount 

remains in the inventory reserve. 

Initial Regulatory Flexibility Analysis 

Pursuant to requirements set forth in 

the Regulatory Flexibility Act (RFA), the 

Agricultural Marketing Service (AMS) 

has considered the economic impact of 

this action on small entities. 

Accordingly, AMS has prepared this 

initial regulatory flexibility analysis. 

The purpose of the RFA is to fit 

regulatory actions to the scale of 

business subject to such actions in order 

that small businesses will not be unduly 

or disproportionately burdened. 

Marketing orders issued pursuant to the 

Act, and rules issued thereunder, are 

unique in that they are brought about 

through group action of essentially 

small entities acting on their own 

behalf. Thus, both statutes have small 

entity orientation and compatibility. 

There are approximately 40 handlers 

of tart cherries who are subject to 

regulation under the tart cherry 

marketing order and approximately 900 

producers of tart cherries in the 

regulated area. Small agricultural 

service firms, which includes handlers, 

have been defined by the Small 

Business Administration (SBA) (13 CFR 

121.201) 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. A majority of the producers 

and handlers are considered small 

entities under SBA’s standards. 

The principal demand for tart cherries 

is in the form of processed products. 

Tart cherries are dried, frozen, canned, 

juiced, and pureed. During the period 

1997/98 through 2008/09, 

approximately 96 percent of the U.S. 

tart cherry crop, or 244.4 million 

pounds, was processed annually. Of the 

244.4 million pounds of tart cherries 

processed, 61 percent was frozen, 27 

percent was canned, and 12 percent was 

utilized for juice and other products. 

Based on National Agricultural 

Statistics Service data, acreage in the 

United States devoted to tart cherry 

production has been trending 

downward. Bearing acreage has 

declined from a high of 50,050 acres in 

1987/88 to 34,650 acres in 2008/09. This 

represents a 31 percent decrease in total 

bearing acres. Michigan leads the nation 

in tart cherry acreage with 70 percent of 

the total and produces about 75 percent 

of the U.S. tart cherry crop each year. 

The 2009/10 crop is large in size at 

355 million pounds. This production 

level is 71.5 million pounds greater than 

the 283.6 million pounds estimated by 

the National Agricultural Statistics 

Service (NASS) in June. The largest crop 

occurred in 1995 with production in the 

regulated districts reaching a record 

395.6 million pounds. The price per 

pound received by tart cherry growers 

ranged from a low of 7.3 cents in 1987 

to a high of 46.4 cents in 1991. These 

problems of wide supply and price 

fluctuations in the tart cherry industry 


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are national in scope and impact. 

Growers testified during the order 

promulgation process that the prices 

they received often did not come close 

to covering the costs of production. 

The industry demonstrated a need for 

an order during the promulgation 

process of the marketing order because 

large variations in annual tart cherry 

supplies tend to lead to fluctuations in 

prices and disorderly marketing. As a 

result of these fluctuations in supply 

and price, growers realize less income. 

The industry chose a volume control 

marketing order to even out these wide 

variations in supply and improve 

returns to growers. During the 

promulgation process, proponents 

testified that small growers and 

processors would have the most to gain 

from implementation of a marketing 

order because many such growers and 

handlers had been going out of business 

due to low tart cherry prices. They also 

testified that, since an order would help 

increase grower returns, this should 

increase the buffer between business 

success and failure because small 

growers and handlers tend to be less 

capitalized than larger growers and 

handlers. 

Aggregate demand for tart cherries 

and tart cherry products tends to be 

relatively stable from year-to-year. 

Similarly, prices at the retail level show 

minimal variation. Consumer prices in 

grocery stores, and particularly in food 

service markets, largely do not reflect 

fluctuations in cherry supplies. Retail 

demand is assumed to be highly 

inelastic which indicates that price 

reductions do not result in large 

increases in the quantity demanded. 

Most tart cherries are sold to food 

service outlets and to consumers as pie 

filling; frozen cherries are sold as an 

ingredient to manufacturers of pies and 

cherry desserts. Juice and dried cherries 

are expanding market outlets for tart 

cherries. 

Demand for tart cherries at the farm 

level is derived from the demand for tart 

cherry products at retail. In general, the 

farm-level demand for a commodity 

consists of the demand at retail or food 

service outlets minus per-unit 

processing and distribution costs 

incurred in transforming the raw farm 

commodity into a product available to 

consumers. These costs comprise what 

is known as the ‘‘marketing margin.’’ 

The supply of tart cherries, by 

contrast, varies greatly. The magnitude 

of annual fluctuations in tart cherry 

supplies is one of the most pronounced 

for any agricultural commodity in the 

United States. In addition, since tart 

cherries are processed either into cans 

or frozen, they can be stored and carried 

over from year-to-year. This creates 

substantial coordination and marketing 

problems. The supply and demand for 

tart cherries is rarely in equilibrium. As 

a result, grower prices fluctuate widely, 

reflecting the large swings in annual 

supplies. 

In an effort to stabilize prices, the tart 

cherry industry uses the volume control 

mechanisms under the authority of the 

Federal marketing order. This authority 

allows the industry to set free and 

restricted percentages. These restricted 

percentages are only applied to states or 

districts with a 3-year average of 

production greater than six million 

pounds, and to states or districts in 

which the production is 50 percent or 

more of the previous 5-year processed 

production average. 

The primary purpose of setting 

restricted percentages is an attempt to 

bring supply and demand into balance. 

If the primary market is over-supplied 

with cherries, grower prices decline 

substantially. 

The tart cherry sector uses an 

industry-wide storage program as a 

supplemental coordinating mechanism 

under the Federal marketing order. The 

primary purpose of the storage program 

is to warehouse supplies in large crop 

years in order to supplement supplies in 

short crop years. The storage approach 

is feasible because the increase in 

price—when moving from a large crop 

to a short crop year—more than offsets 

the costs for storage, interest, and 

handling of the stored cherries. 

The price that growers receive for 

their crop is largely determined by the 

total production volume and carryin 

inventories. The Federal marketing 

order permits the industry to exercise 

supply control provisions, which allow 

for the establishment of free and 

restricted percentages for the primary 

market, and a storage program. The 

establishment of restricted percentages 

impacts the production to be marketed 

in the primary market, while the storage 

program has an impact on the volume 

of unsold inventories. 

The volume control mechanism used 

by the cherry industry results in 

decreased shipments to primary 

markets. Without volume control the 

primary markets (domestic) would 

likely be over-supplied, resulting in 

lower grower prices. 

To assess the impact that volume 

control has on the prices growers 

receive for their product, an 

econometric model has been developed. 

The econometric model provides a way 

to see what impacts volume control may 

have on grower prices. The three 

districts in Michigan, along with the 

districts in Utah, New York, and 

Washington are the restricted areas for 

this crop year and their combined total 

production is 338 million pounds. A 68 

percent restriction means 108 million 

pounds is available to be shipped to 

primary markets from these four states. 

Production levels of 10.7 million 

pounds for Wisconsin, 2.7 million 

pounds for Oregon, and 3.8 million 

pounds for Pennsylvania (the 

unregulated areas in 2009/10), result in 

an additional 17.2 million pounds 

available for primary market shipments. 

In addition, USDA requires a 10 

percent release from reserves as a 

market growth factor. This results in an 

additional 18 million pounds being 

available for the primary market. The 

108 million pounds from Michigan, 

Utah, Washington, and New York, the 

17.2 million pounds from the other 

producing states, the 18 million pound 

release, and the 52 million pound 

carryin inventory gives a total of 195.2 

million pounds being available for the 

primary markets. 

The econometric model is used to 

estimate the impact of establishing a 

reserve pool for this year’s crop. With 

the volume controls, grower prices are 

estimated to be approximately $0.12 per 

pound higher than without volume 

controls. 

The use of volume controls is 

estimated to have a positive impact on 

growers’ total revenues. With regulation, 

growers’ total revenue from processed 

cherries are estimated to be $17.3 

million higher than without restrictions. 

The without-restrictions scenario 

assumes that all tart cherries produced 

would be delivered to processors for 

payments. 

It is concluded that the 68 percent 

volume control would not unduly 

burden producers, particularly smaller 

growers. The 68 percent restriction 

would be applied to the growers in 

Michigan, New York, Utah, and 

Washington. The growers in the other 

three states covered under the marketing 

order will benefit from this restriction. 

Recent grower prices have been as 

high as $0.44 per pound in 2002–03 

when there was a crop failure. Prices in 

the last two crop years have been $0.268 

in 2007–08 and $0.372 per pound in 

2008–09. At current production levels, 

yield is estimated at approximately 

10,251 pounds per acre. At this level of 

yield the cost of production is estimated 

to be $0.25 per pound (costs were 

estimated by representatives of 

Michigan State University with input 

provided by growers for the current 

crop). While grower prices have not 

been established in the 2009–10 crop 

year, some processors have reported that 

growers have received an initial 


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payment of ten cents per pound. 

Additional payments by processors will 

be based on the volume of packed crop 

that can be marketed. These low prices 

are the result of the large crop for the 

2009–10 marketing year. The final 

grower price will likely be around $0.15 

per pound for the combined free and 

restricted production. Thus, this year’s 

grower price even with regulation is 

estimated to be below the cost of 

production. The use of volume controls 

is believed to have little or no effect on 

consumer prices and will not result in 

fewer retail sales or sales to food service 

outlets. 

Without the use of volume controls, 

the industry could be expected to start 

to build large amounts of unwanted 

inventories. These inventories have a 

depressing effect on grower prices. The 

econometric model shows for every 1 

million-pound increase in carryin 

inventories, a decrease in grower prices 

of $0.0036 per pound occurs. The use of 

volume controls allows the industry to 

supply the primary markets while 

avoiding the disastrous results of oversupplying these markets. In addition, 

through volume control, the industry 

has an additional supply of cherries that 

can be used to develop secondary 

markets such as exports and the 

development of new products. The use 

of reserve cherries in the production 

shortened 2002/03 crop year proved to 

be very useful and beneficial to growers 

and packers. 

In discussing the possibility of 

marketing percentages for the 2009– 

2010 crop year, the Board considered 

the following factors contained in the 

marketing policy: (1) The estimated total 

production of tart cherries; (2) the 

estimated size of the crop to be handled; 

(3) the expected general quality of such 

cherry production; (4) the expected 

carryover as of July 1 of canned and 

frozen cherries and other cherry 

products; (5) the expected demand 

conditions for cherries in different 

market segments; (6) supplies of 

competing commodities; (7) an analysis 

of economic factors having a bearing on 

the marketing of cherries; (8) the 

estimated tonnage held by handlers in 

primary or secondary inventory 

reserves; and (9) any estimated release 

of primary or secondary inventory 

reserve cherries during the crop year. 

The Board’s review of the factors 

resulted in the computation and 

announcement in September 2009 of the 

free and restricted percentages proposed 

to be established by this rule (32 percent 

free and 68 percent restricted). 

One alternative to this action would 

be not to have volume regulation this 

season. Board members stated that no 

volume regulation would be detrimental 

to the tart cherry industry due to the 

size of the 2009–2010 crop. Returns to 

growers would not cover their costs of 

production for this season which might 

cause some to go out of business. 

As mentioned earlier, the 

Department’s ‘‘Guidelines for Fruit, 

Vegetable, and Specialty Crop 

Marketing Orders’’ specify that 110 

percent of recent years’ sales should be 

made available to primary markets each 

season before recommendations for 

volume regulation are approved. The 

quantity available under this rule is 110 

percent of the quantity shipped in the 

prior three years. 

The free and restricted percentages 

established by this rule release the 

optimum supply and apply uniformly to 

all regulated handlers in the industry, 

regardless of size. There are no known 

additional costs incurred by small 

handlers that are not incurred by large 

handlers. The stabilizing effects of the 

percentages impact all handlers 

positively by helping them maintain 

and expand markets, despite seasonal 

supply fluctuations. Likewise, price 

stability positively impacts all 

producers by allowing them to better 

anticipate the revenues their tart 

cherries will generate. 

The Department has not identified 

any relevant Federal rules that 

duplicate, overlap, or conflict with this 

regulation. 

In addition, the Board’s meeting was 

widely publicized throughout the tart 

cherry industry and all interested 

persons were invited to attend the 

meeting and participate in Board 

deliberations on all issues. Like all 

Board meetings, the September 10, 

2009, 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 information on the regulatory 

and informational impacts of this action 

on small businesses. 

While the benefits resulting from this 

rulemaking are difficult to quantify, the 

stabilizing effects of the volume 

regulations impact both small and large 

handlers positively by helping them 

maintain markets even though tart 

cherry supplies fluctuate widely from 

season to season. 

In compliance with Office of 

Management and Budget (OMB) 

regulations (5 CFR part 1320) which 

implement the Paperwork Reduction 

Act of 1995 (Pub. L. 104–13), the 

information collection and 

recordkeeping requirements under the 

tart cherry marketing order have been 

previously approved by OMB and 

assigned OMB Number 0581–0177. 

Reporting and recordkeeping burdens 

are necessary for compliance purposes 

and for developing statistical data for 

maintenance of the program. The forms 

require information which is readily 

available from handler records and 

which can be provided without data 

processing equipment or trained 

statistical staff. As with other, similar 

marketing order programs, reports and 

forms are periodically studied to reduce 

or eliminate duplicate information 

collection burdens by industry and 

public sector agencies. This rule does 

not change those requirements. 

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. 

A small business guide on complying 

with fruit, vegetable, and specialty crop 

marketing agreements and orders may 

be viewed at: http://www.ams.usda.gov/ 

fv/moab.html. Any questions about the 

compliance guide should be sent to 

Antoinette Carter 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 proposal. Fifteen days is deemed 

appropriate because this rule would 

need to be in place as soon as possible 

since handlers are already shipping tart 

cherries from the 2009–2010 crop. All 

written comments timely received will 

be considered before a final 

determination is made on this matter. 

List of Subjects in 7 CFR Part 930 

Marketing agreements, Reporting and 

recordkeeping requirements, Tart 

cherries. 

For the reasons set forth in the 

preamble, 7 CFR part 930 is proposed to 

be amended as follows: 

PART 930—TART CHERRIES GROWN 

IN THE STATES OF MICHIGAN, NEW 

YORK, PENNSYLVANIA, OREGON, 

UTAH, WASHINGTON, AND 

WISCONSIN 

1. The authority citation for 7 CFR 

part 930 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

2. Section 930.256 is added to read as 

follows: 

Note: This section will not appear in the 

annual Code of Federal Regulations. 

§ 930.256 Final free and restricted 

percentages for the 2009–2010 crop year. 

The final percentages for tart cherries 

handled by handlers during the crop 


wwoods2 on DSK1DXX6B1PROD with PROPOSALS_PART 1
Federal Register / Vol. 75, No. 51 / Wednesday, March 17, 2010 / Proposed Rules 12707 

year beginning on July 1, 2009, which 

shall be free and restricted, respectively, 

are designated as follows: Free 

percentage, 32 percent and restricted 

percentage, 68 percent. 

Dated: March 11, 2010. 

David R. Shipman, 

Acting Administrator, Agricultural Marketing 

Service. 

[FR Doc. 2010–5772 Filed 3–16–10; 8:45 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 1218 

[Document Number AMS–FV–09–0022; FV– 

09–705] 

Blueberry Promotion, Research, and 

Information Order; Increase 

Membership 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Proposed rule. 

SUMMARY: This rule proposes to add two 

importer members and their alternates 

to the U.S. Highbush Blueberry Council 

(Council) to reflect changes in the 

quantity of highbush blueberry imports 

in the past three years. The change was 

proposed by the Council in accordance 

with the provisions of the Blueberry 

Promotion, Research, and Information 

Order (Order) which is authorized by 

the Commodity Promotion, Research, 

and Information Act of 1996 (Act). The 

Order requires that the Council review 

the geographical distribution of the 

United States production and the 

quantity of imports of highbush 

blueberries at least every five years. As 

a result of these changes, the total 

Council membership would increase 

from 14 to 16 members and their 

alternates. In addition, this rule 

proposes to increase the quorum 

minimum from seven to nine members. 

DATES: Comments must be received by 

April 6, 2010. 

ADDRESSES: Interested persons are 

invited to submit written comments on 

the Internet at: http:// 

www.regulations.gov or to the Research 

and Promotion Branch, Fruit and 

Vegetable Programs, Agricultural 

Marketing Service (AMS), U.S. 

Department of Agriculture, 

(Department) Room 0632–S, Stop 0244, 

1400 Independence Avenue, SW., 

Washington, DC 20250–0244; facsimile: 

(202) 205–2800. 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 

above office during regular business 

hours or it can be viewed at http:// 

www.regulations.gov. All comments 

received will be posted without change, 

including any personal information 

provided. 

FOR FURTHER INFORMATION CONTACT: 

Jeanette Palmer, Marketing Specialist, 

Research and Promotion Branch, Fruit 

and Vegetable Programs, AMS, U.S. 

Department of Agriculture, Stop 0244, 

1400 Independence Avenue, SW., Room 

0632–S, Washington, DC 20250–0244; 

telephone: (888) 720–9917; facsimile: 

(202) 205–2800; or electronic mail: 

Jeanette.Palmer@ams.usda.gov. 

SUPPLEMENTARY INFORMATION: This rule 

is issued under the Blueberry 

Promotion, Research, and Information 

Order [7 CFR part 1218]. The Order is 

authorized under the Commodity 

Promotion, Research, and Information 

Act of 1996 (Act) [7 U.S.C. 7411–7425]. 

Executive Order 12866 

The Office of Management and Budget 

(OMB) has waived the review process 

required by Executive Order 12866 for 

this action. 

Executive Order 12988 

This rule has been reviewed under 

Executive Order 12988, Civil Justice 

Reform. The rule is not intended to have 

retroactive effect. Section 524 of the Act 

provides that the Act shall not affect or 

preempt any other State or Federal law 

authorizing promotion or research 

relating to an agricultural commodity. 

The Act provides that any person 

subject to an order may file a written 

petition with the Department if they 

believe that the order, any provision of 

the order, or any obligation imposed in 

connection with the order, is not 

established in accordance with law. In 

any petition, the person may request a 

modification of the order or an 

exemption from the order. The 

petitioner is afforded the opportunity 

for a hearing on the petition. After a 

hearing, the Department would rule on 

the petition. The Act provides that the 

district court of the United States in any 

district in which the petitioner resides 

or conducts business shall have the 

jurisdiction to review the Department’s 

ruling on the petition, provided a 

complaint is filed not later than 20 days 

after the date of the entry of the ruling. 

Initial Regulatory Flexibility Analysis 

and Paperwork Reduction Act 

In accordance with the Regulatory 

Flexibility Act (RFA) [5 U.S.C. 601– 

612], AMS has considered the economic 

impact of this action on the small 

producers, first handlers, importers, and 

exporters that would be affected by this 

rule. The purpose of the RFA is to fit 

regulatory action to scale on businesses 

subject to such action so that small 

businesses will not be 

disproportionately burdened. 

The Small Business Administration 

defines, in 13 CFR part 121, small 

agricultural producers as those having 

annual receipts of no more than 

$750,000 and small agricultural service 

firms as those having annual receipts of 

no more than $7 million. There are 

approximately 2,000 producers, 200 first 

handlers, 50 importers, and 4 exporters 

of highbush blueberries subject to the 

program. Most of the producers would 

be classified as small businesses under 

the criteria established by the Small 

Business Administration. Most 

importers, first handlers, and exporters 

would not be classified as small 

businesses. Producers who produce less 

than 2,000 pounds of highbush 

blueberries annually are exempt from 

this program. Importers who import less 

than 2,000 pounds of fresh and frozen 

highbush blueberries annually are also 

exempt from this program. 

The Department’s National 

Agricultural Statistics Service (NASS) 

data for the 2008 crop year shows that 

about 5,790 pounds of highbush 

blueberries were produced per acre. The 

2008 average grower price for highbush 

blueberries published by NASS was 

$1.54 per pound. Thus, the value of 

highbush blueberry production per acre 

in 2008 averaged about $8,917 (5,790 

pounds multiplied by $1.54). At that 

average value, a producer would have to 

farm over 84 acres to receive an annual 

income from highbush blueberries of 

$750,000 ($750,000 divided by $8,916 

per acre equals 84). Accordingly, as 

previously noted, a majority of the 

producers of highbush blueberries 

would be classified as small businesses. 

According to the Council, assessments 

received in 2008 reached $2.4 million. 

Of the total, the Council received 

$830,222 from import assessment 

collections which is approximately 35 

percent of the Council’s total budget. 

The Council has projected import 

assessment collections at $850,000 for 

the 2009 budget year. 

According to the Council’s World 

Blueberry Acreage and Production 

Report, highbush blueberry acreage in 

North America increased from 71,075 

acres in 2005 to an estimated 95,607 

acres in 2008, a 35 percent increase in 

just three years. The United States’ 

share of this total increased from 56,665 

acres in 2005 to 74,992 acres in 2008, 

a 32 percent increase. Most of this 


wwoods2 on DSK1DXX6B1PROD with PROPOSALS_PART 1