[Federal Register Volume 77, Number 42 (Friday, March 2, 2012)]
[Proposed Rules]
[Pages 12748-12752]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-5171]


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Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 77, No. 42 / Friday, March 2, 2012 / Proposed 
Rules

[[Page 12748]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 930

[Doc. No. AMS-FV-11-0085; FV11-930-3 PR]


Tart Cherries Grown in the States of Michigan, et al.; Final Free 
and Restricted Percentages for the 2011-12 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 2011-12 crop year under the 
marketing order for tart cherries grown in the states of Michigan, New 
York, Pennsylvania, Oregon, Utah, Washington, and Wisconsin (order). 
The order is administered locally by the Cherry Industry Administrative 
Board (Board). This action would establish the proportion of tart 
cherries from the 2011 crop which may be handled in commercial outlets 
at 88 percent free and 12 percent restricted. These percentages should 
stabilize marketing conditions by adjusting supply to meet market 
demand and help improve grower returns.

DATES: Comments must be received by April 2, 2012.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposal. Comments must be sent to the Docket Clerk, 
Marketing Order and Agreement Division, Fruit and Vegetable Program, 
AMS, USDA, 1400 Independence Avenue SW., STOP 0237, Washington, DC 
20250-0237; Fax: (202) 720-8938; or Internet: http://www.regulations.gov. All comments should reference the document number 
and the date and page number of this issue of the Federal Register and 
will be made available for public inspection in the Office of the 
Docket Clerk during regular business hours, or can be viewed at: http://www.regulations.gov. All comments submitted in response to this 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: Jennie M. Varela, Marketing 
Specialist, or Christian D. Nissen, Regional Manager, Southeast 
Marketing Field Office, Marketing Order and Agreement Division, Fruit 
and Vegetable Programs, AMS, USDA; Telephone: (863) 324-3375, Fax: 
(863) 325-8793, or Email: <a href="/cdn-cgi/l/email-protection#246e414a4a4d410a724556414845644549570a515740450a434b52"><span class="__cf_email__" data-cfemail="2369464d4d4a460d754251464f4263424e500d565047420d444c55">[email protected]</span></a> or 
<a href="/cdn-cgi/l/email-protection#fcbf948e958f88959d92d2b2958f8f9992bc9d918fd2898f989dd29b938a"><span class="__cf_email__" data-cfemail="5112392338222538303f7f1f382222343f11303c227f242235307f363e27">[email protected]</span></a>.
    Small businesses may request information on complying with this 
regulation by contacting Laurel May, Marketing Order and Agreement 
Division, 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 Email: <a href="/cdn-cgi/l/email-protection#571b362225323b791a362e17363a24792224333679303821"><span class="__cf_email__" data-cfemail="2f634e5a5d4a4301624e566f4e425c015a5c4b4e01484059">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION: This proposal is issued under Marketing 
Agreement and Order No. 930, both as amended (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 (USDA) is issuing this rule in 
conformance with Executive Order 12866.
    This proposal has been reviewed under Executive Order 12988, Civil 
Justice Reform. Under the order provisions now in effect, final free 
and restricted percentages may be established for tart cherries handled 
during the crop year. This proposed rule would establish final free and 
restricted percentages for tart cherries for the 2011-12 crop year, 
beginning July 1, 2011, through June 30, 2012.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 608c(15)(A) of the 
Act, any handler subject to an order may file with USDA a petition 
stating that the order, any provision of the order, or any obligation 
imposed in connection with the order is not in accordance with law and 
request a modification of the order or to be exempted therefrom. A 
handler is afforded the opportunity for a hearing on the petition. 
After the hearing, USDA would rule on the petition. The Act provides 
that the district court of the United States in any district in which 
the handler is an inhabitant, or has his or her principal place of 
business, has jurisdiction to review USDA's ruling on the petition, 
provided an action is filed not later than 20 days after the date of 
the entry of the ruling.
    This rule invites comments on the establishment of final free and 
restricted percentages for the 2011-12 crop year. This action would 
establish the proportion of tart cherries from the 2011 crop which may 
be handled in commercial outlets at 88 percent free and 12 percent 
restricted. These percentages should stabilize marketing conditions by 
adjusting supply to meet market demand and help improve grower returns. 
The action was recommended by the Board at a meeting on September 15, 
2011.
    Section 930.51(a) of the order provides authority to regulate 
volume by designating free and restricted percentages for any tart 
cherries acquired by handlers in a given crop year. Section 930.50 
prescribes procedures for computing an optimum supply based on sales 
history and for calculating these free and restricted percentages. Free 
percentage volume may be shipped to any market, while restricted 
percentage volume must be held by handlers in a primary or secondary 
reserve, or be diverted or used for exempt purposes as prescribed in 
Sec. Sec.  930.159 and 930.162 of the regulations. These activities 
include, in part, the development of new products, sales into new 
markets, the development of export markets, and charitable 
contributions.
    Under Sec.  930.52, only those districts with an annual average 
production of at least six million pounds are subject to regulation and 
any district producing a crop which is less than 50 percent of its 
annual average is exempt. The regulated districts for the 2011-2012 
crop year would be: District 1--Northern Michigan; District 2--Central 
Michigan; District 3--Southern Michigan; District

[[Page 12749]]

4--New York; District 7--Utah; and District 8--Washington. Districts 5, 
6, and 9 (Oregon, Pennsylvania, and Wisconsin, respectively) would not 
be regulated for the 2011-12 season.
    Demand for tart cherries and tart cherry products tends to be 
relatively stable from year to year. Conversely, annual tart cherry 
production can vary greatly. In addition, tart cherries are processed 
and can be stored and carried over from crop year to crop year, further 
impacting supply. As a result, supply and demand for tart cherries are 
rarely in balance.
    Because demand for tart cherries is inelastic, total sales volume 
is not very responsive to changes in price. However, prices are very 
sensitive to changes in supply. As such, an oversupply of cherries 
would have a sharp negative effect on prices, driving down grower 
returns. The Board, aware of this economic relationship, focuses on 
using the volume control provisions in the order to balance supply and 
demand to stabilize industry returns.
    Pursuant to Sec.  930.50 of the order, the Board meets on or about 
July 1 to review sales data, inventory data, current crop forecasts and 
market conditions for the upcoming season and, if necessary, to 
recommend preliminary free and restricted percentages if anticipated 
supply would exceed demand. After harvest is complete, but no later 
than September 15, the Board meets again to update their calculations 
using actual production data, consider any necessary adjustments to the 
preliminary percentages, and determine if final free and restricted 
percentages should be recommended to the Secretary.
    To assist in this process, the Board uses an optimum supply formula 
(OSF), a series of mathematical calculations using sales history, 
inventory, and production data to determine whether there is a surplus, 
and if so, how much volume should be restricted to maintain optimum 
supply. The optimum supply represents the desirable volume of tart 
cherries that should be available for sale in the coming crop year. 
Optimum supply is defined as the average free sales of the prior three 
years plus desirable carry-out inventory. Desirable carry-out is the 
amount of fruit needed by the industry to be carried into the 
succeeding crop year to meet marketing demand until the new crop is 
available. Desirable carry-out is set by the Board after considering 
market circumstances and needs. This figure can range from zero to a 
maximum of 20 million pounds.
    To determine whether the industry would be in an oversupply 
situation for the coming year, the Board compares the optimum supply 
figure and the total anticipated supply for the coming year. 
Anticipated supply includes any inventory available at the beginning of 
the season (carry-in) and the current year's estimated production. The 
carry-in figure is subtracted from the optimum supply to determine the 
volume of cherries that would need to be produced in the current year 
to provide what is needed to meet the optimum supply. If estimated 
production is less than the optimum supply minus carry-in, the Board is 
required to establish a free percentage of 100 percent and a restricted 
percentage of zero. If production is greater than the optimum supply 
minus carry-in, the difference is considered surplus. To calculate the 
restricted percentage, this surplus tonnage is divided by the sum of 
production in the regulated districts.
    The Board met on June 23, 2011, and computed an optimum supply of 
174 million pounds for the 2011-12 crop year, using the free sales for 
the three previous seasons and setting the desirable carry-out at zero. 
The Board then subtracted the estimated carry-in of 57 million pounds 
from the optimum supply to calculate the production needed from the 
2011-12 crop to meet optimum supply. This number, 117 million pounds, 
was subtracted from USDA's estimated 2011-12 production of 266 million 
pounds to calculate a surplus of 149 million pounds of tart cherries. 
The surplus was then divided by the expected production in the 
regulated districts (253 million pounds) to reach a preliminary 
restricted percentage of 59 percent for the 2011-12 crop year.
    In discussing the results of the OSF calculations, members were in 
agreement that a restriction was necessary in order to avoid 
oversupplying the market. However, there was discussion that a 59 
percent restriction may be too restrictive considering current market 
conditions. Board members recognized that the previous season, 
inventory had been tight, requiring two releases from reserves to meet 
sales needs. Further, it was stated that exports would likely remain 
strong in the coming season due to poor production in Europe. 
Consequently, the Board concluded market conditions justified making an 
economic adjustment, and the Board voted to add 30 million pounds to 
free supply, reducing the calculated surplus from 149 million pounds to 
119 million pounds.
    In addition, 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. Accordingly, 
Sec.  930.50(g) of the order specifies that in years when restricted 
percentages are established, the Board shall make available tonnage 
equivalent to an additional 10 percent of the average sales of the 
prior three years for market expansion (market growth factor). The 
Board complied with this requirement by adding 17 million pounds (174 
million times 10 percent) to the free supply, further reducing the 
surplus to 102 million pounds. After these two adjustments, the 
preliminary restricted percentage was recalculated as 40 percent, as 
outlined in the following table:

------------------------------------------------------------------------
                                                                Millions
                                                               of pounds
------------------------------------------------------------------------
Preliminary Calculations:
  (1) Average sales of the prior three years.................        174
  (2) Plus desirable carry-out...............................          0
  (3) Optimum supply calculated by the Board.................        174
  (4) Carry-in as of June 23, 2011...........................         57
  (5) Adjusted optimum supply (item 3 minus item 4)..........        117
  (6) USDA crop estimate.....................................        266
  (7) Surplus (item 6 minus item 5)..........................        149
  (8) Economic adjustment....................................         30
  (9) Market growth factor...................................         17
  (10) Adjusted Surplus (item 7 minus items 8 and 9).........        102
  (11) Crop estimate for regulated districts.................        253
------------------------------------------------------------------------


 
                                                                Percent
------------------------------------------------------------------------
Preliminary Percentages:
  Restricted (item 10 divided by item 11 x 100)..............         40
  Free (100 minus restricted percentage).....................         60
------------------------------------------------------------------------

    The Board met again September 15, 2011, to consider establishing 
final volume regulation percentages for the 2011-12 season. The final 
percentages are based on the Board's reported production figures and 
the supply and demand information available in September. The actual 
production for the 2011-12 season was 231 million pounds, 35 million 
pounds below USDA's June estimate. Concerned about having an adequate 
volume of cherries in the free market with actual production below the 
estimate, the Board voted to make a further adjustment of 40 million 
pounds in addition to the June adjustment. Using the actual production 
numbers, and accounting for the two adjustments, as well as the market 
growth factor, the restricted percentage was recalculated.

[[Page 12750]]

    The Board used the same carry-in figure used in June of 57 million 
pounds, and subtracted it from the optimum supply of 174 million 
pounds, calculating the 2011-12 production volume required to meet the 
optimum supply of 117 million pounds. The 117 million pounds was 
subtracted from the actual production of 231 million pounds, resulting 
in a surplus of 114 million pounds of tart cherries. The surplus was 
then reduced by subtracting the two economic adjustments of 30 million 
pounds and 40 million pounds, and the market growth factor of 17 
million pounds, resulting in an adjusted surplus of 27 million pounds. 
This surplus was then divided by the actual production in the regulated 
districts (218 million pounds) to calculate a restricted percentage of 
12 percent with a corresponding free percentage of 88 percent for the 
2011-12 crop year, as outlined in the following table:

------------------------------------------------------------------------
                                                                Millions
                                                               of pounds
------------------------------------------------------------------------
Final Calculations:
  (1) Average sales of the prior three years.................        174
  (2) Plus desirable carry-out...............................          0
  (3) Optimum supply calculated by the Board.................        174
  (4) Carry-in as of July 1, 2011............................         57
  (5) Adjusted optimum supply (item 3 minus item 4)..........        117
  (6) Board reported production..............................        231
  (7) Surplus (item 6 minus item 5)..........................        114
  (8) Total economic adjustments.............................         70
  (9) Market growth factor...................................         17
  (10) Adjusted Surplus (item 7 minus items 8 and 9).........         27
  (11) Crop estimate for regulated districts.................        218
------------------------------------------------------------------------


 
                                                                Percent
------------------------------------------------------------------------
Final Percentages:
  Restricted (item 10 divided by item 11 x 100)..............         12
  Free (100 minus restricted percentage).....................         88
------------------------------------------------------------------------

    The primary purpose of setting restricted percentages is an attempt 
to bring supply and demand into balance. If the primary market is 
oversupplied with cherries, grower prices decline substantially. 
Restricted percentages have benefited grower returns and helped 
stabilize the market as compared to those seasons prior to the 
implementation of the order. The Board believes the available 
information indicates that a restricted percentage should be 
established for the 2011-12 crop year to avoid oversupplying the market 
with tart cherries. Consequently, based on its discussion of this issue 
and the result of the above calculations, the Board recommended final 
percentages of 88 percent free and 12 percent restricted by a vote of 
13 in favor and 4 against.
    Of the four Board members who opposed the recommendation, one 
believed regulation was unnecessary for the current crop year, while 
the other three believed the recommended percentages were not 
restrictive enough. The member who believed the regulation was too 
restrictive cited strong sales in the previous season and moderate 
production volume for this crop year. In its discussion regarding the 
establishment of a restricted percentage for the 2011-12 crop year, the 
Board did recognize the strong sales in the previous season, as well as 
the fact that actual production had come in below the production 
estimate. In response, the Board voted to make two adjustments to make 
additional volume available. However, the majority of Board members 
still held that market conditions warranted some level of restriction. 
Further, the Board could meet and recommend the release of additional 
volume during the crop year, if warranted.
    One of those who opposed the recommendation as not being 
restrictive enough stated that making the two adjustments and 
increasing the free volume this season could result in large 
inventories carrying over into the next season, which would require 
increased restrictions and dampen prices. Another stated that strong 
demand might not be sustained in the coming year and making additional 
fruit available at the onset of the season was premature and could 
result in an oversupply of the market. One opponent also stated that 
rather than making adjustments now, the Board could vote to release a 
portion of reserves later in the season to provide more fruit if 
necessary. However, most Board members believed that making more fruit 
available to the market was warranted. Board members cited the two 
releases from the previous season, sales volume from last year, and the 
smaller than anticipated crop in support of making more free tonnage 
available. It was also argued that increasing the volume of cherries 
available at the onset of the season could facilitate additional sales.
    After reviewing the available data, and considering the concerns 
expressed, the majority of the Board determined that a 12 percent 
restriction would meet sales needs without oversupplying the market. 
Thus, the Board recommended establishing final percentages of 88 
percent free and 12 percent restricted.

Initial Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601-612), the Agricultural Marketing Service (AMS) 
has considered the economic impact of this action on small entities. 
Accordingly, AMS has prepared this initial regulatory flexibility 
analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
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.
    There are approximately 40 handlers of tart cherries who are 
subject to regulation under the marketing order and approximately 600 
producers of tart cherries in the regulated area. Small agricultural 
service firms have been defined by the Small Business Administration 
(SBA) as those having annual receipts of less than $7,000,000, and 
small agricultural producers are defined as those having annual 
receipts of less than $750,000 (13 CFR 121.201).
    According to the National Agricultural Statistics Service, and 
Board data, the average annual grower price for tart cherries during 
the 2010-11 season was $0.221 per pound, and total shipments were 
around 270 million pounds. Therefore, average receipts for tart cherry 
producers were around $99,000, well below the SBA threshold for small 
producers. In 2010, The Food Institute estimated an f.o.b. price of 
$0.84 per pound for frozen tart cherries, which make up the majority of 
processed tart cherries. Using this data, average annual handler 
receipts were about $5.7 million, also below the SBA threshold for 
small agricultural service firms. Assuming a normal distribution, the 
majority of producers and handlers of tart cherries may be classified 
as small entities.
    The tart cherry industry in the United States is characterized by 
wide annual fluctuations in production. According to the National 
Agricultural Statistics Service, tart cherry production in 2007 was 253 
million pounds, 214 million pounds in 2008, 359 million pounds in 2009, 
and in 2010, production was 190 million pounds. Because of these 
fluctuations, the supply and demand for tart cherries are rarely in 
equilibrium.
    Demand for tart cherries is inelastic, meaning changes in price 
have a minimal effect on total sales volume. However, prices are very 
sensitive to

[[Page 12751]]

changes in supply, and grower prices vary widely in response to the 
large swings in annual supply, with prices ranging from a low of 7.3 
cents in 1987 to a high of 46.4 cents in 1991.
    Because of this relationship between supply and price, 
oversupplying the market with tart cherries would have a sharp negative 
effect on prices, driving down grower returns. The Board, aware of this 
economic relationship, focuses on using the volume control authority in 
the order in an effort to balance supply and demand in order to 
stabilize industry returns. This authority allows the industry to set 
free and restricted percentages as a way to bring supply and demand 
into balance. Free percentage cherries can be marketed by handlers to 
any outlet, while restricted percentage volume must be held by handlers 
in reserve, be diverted or used for exempted purposes.
    This proposal would establish final free and restricted percentages 
for the 2011-12 crop year under the order for tart cherries. This 
action would control the supply of tart cherries by establishing 
percentages of 88 percent free and 12 percent restricted for the 2011-
12 crop year. These percentages should stabilize marketing conditions 
by adjusting supply to meet market demand and help improve grower 
returns. The action would regulate tart cherries handled in Michigan, 
New York, Utah, and Washington. The authority for this action is 
provided for in Sec. Sec.  930.51(a) and 930.52 of the order. The Board 
recommended this action at a meeting on September 15, 2011.
    As mentioned earlier, 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. The 
quantity available under this rule is 110 percent of the quantity 
shipped in the prior three years.
    This action would result in some fruit being diverted from the 
primary domestic markets. However, there are secondary uses available 
for restricted fruit, including the development of new products, sales 
into new markets, the development of export markets, and being placed 
in reserve. While these alternatives may provide different levels of 
return than the sales to primary markets, they play an important role 
for the industry. The areas of new products, new markets, and the 
development of export markets utilize restricted fruit to develop and 
expand the market for tart cherries. Last season, these areas accounted 
for more than 50 million pounds in sales.
    Placing tart cherries into reserves is a key part of balancing 
supply and demand. Although the industry must bear the costs of 
handling and storage for fruit in reserve, reserves warehouse supplies 
in large crop years in order to supplement supplies in short crop 
years. The reserves allow the industry to mitigate the impact of 
oversupply in large crop years, while allowing the industry to maintain 
and supply markets in years where production falls below demand. 
Further, the costs for storage, interest, and handling of the cherries 
are more than offset by the increase in price when moving from a large 
crop to a short crop year.
    In addition, this action would be less restrictive than in previous 
seasons and would be the lowest restricted percentage since 2008. At 
this level of restriction, nearly all restricted fruit should be 
utilized by the end of the crop year. Consequently, it is not 
anticipated that this action would unduly burden growers or handlers.
    While this action could result in some additional costs to the 
industry, these costs are more than outweighed by the benefits. The 
purpose of setting restricted percentages is to attempt to bring supply 
and demand into balance. If the primary market (domestic) is 
oversupplied with cherries, grower prices decline substantially. 
Without volume control, the primary market would likely be 
oversupplied, resulting in lower 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 
with a combined total production of 218.4 million pounds. A 12 percent 
restriction means 192.2 million pounds would be available to be shipped 
to primary markets from these four states. The 192.2 million pounds 
from the restricted districts, the 12.2 million pounds from the 
unrestricted districts (Oregon, Pennsylvania, and Wisconsin), and the 
57 million pound carry-in inventory would make a total of 261.4 million 
pounds available as free tonnage for the primary markets.
    To assess the impact that volume control has on the prices growers 
receive for their product, an econometric model has been developed. 
Based on the model, the use of volume control would have a positive 
impact on grower returns for this crop year. With volume control, 
grower prices are estimated to be approximately $0.06 per pound higher, 
and total grower revenue from processed cherries is estimated to be 
$6.2 million higher than without restrictions. The without-restrictions 
scenario assumes that all tart cherries produced would be delivered to 
processors for payments.
    Prior to the implementation of the order, grower price often did 
not come close to covering the cost of production. For the 2011-12 crop 
year, yield is estimated at approximately 6,470 pounds per acre. At 
this level of yield, the cost of production is estimated to be $0.33 
per pound (costs were estimated by representatives of Michigan State 
University).
    In addition, absent volume control, the industry could start to 
build large amounts of unwanted inventories. These inventories would 
have a depressing effect on grower prices. The econometric model shows 
for every 1 million-pound increase in carry-in inventories, a decrease 
in grower prices of $0.0037 per pound occurs.
    Retail demand is assumed to be highly inelastic which indicates 
that changes in price do not result in significant changes in the 
quantity demanded. Consumer prices largely do not reflect fluctuations 
in cherry supplies. Therefore, this action should have little or no 
effect on consumer prices and should not result in a reduction in 
retail sales.
    The free and restricted percentages established by this rule would 
provide the market with optimum supply and apply uniformly to all 
regulated handlers in the industry, regardless of size. As the 
restriction represents a percentage of a handler's volume, the costs, 
when applicable, are proportionate and should not place an extra burden 
on small entities as compared to large entities.
    The stabilizing effects of this action would benefit all handlers 
by helping them maintain and expand markets, despite seasonal supply 
fluctuations. Likewise, price stability positively impacts all growers 
and handlers by allowing them to better anticipate the revenues their 
tart cherries would generate. Growers and handlers, regardless of size, 
would benefit from the stabilizing effects of this restriction.
    One alternative to this action considered was to not regulate the 
volume of the 2011-12 crop. However, Board members believed that 
although sales have been strong, there is enough of a surplus to 
necessitate restricting a portion of the crop to keep prices stable.
    Another alternative considered was setting the carry-out value at 
10 or 20 million pounds in the OSF. Board members indicated that such a 
change would require further consideration by the Board, and did not 
receive sufficient support.

[[Page 12752]]

    The Board also considered differing levels of adjustments under the 
OSF when considering supply. The alternative adjustments were deemed to 
be either too small to address industry needs, or so large that members 
were concerned with creating an oversupply. Therefore, these 
alternatives were rejected.
    In accordance with the Paperwork Reduction Act of 1995, (44 U.S.C. 
Chapter 35), the order's information collection requirements have been 
previously approved by the Office of Management and Budget (OMB) and 
assigned OMB No. 0581-0177, Tart cherries Grown in the States of MI, 
NY, PA, OR, UT, WA, and WI. No changes in those requirements as a 
result of this action are necessary. Should any changes become 
necessary, they would be submitted to OMB for approval.
    This action would not impose any additional reporting or 
recordkeeping requirements on either small or large tart cherry 
handlers. As with all Federal marketing order programs, reports and 
forms are periodically reviewed to reduce information requirements and 
duplication by industry and public sector agencies.
    AMS is committed to complying with the E-Government Act, to promote 
the use of the Internet and other information technologies to provide 
increased opportunities for citizen access to Government information 
and services, and for other purposes.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap or conflict with this proposed rule.
    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 15, 2011, meeting was a 
public meeting and all entities, both large and small, were able to 
express views on this issue. Finally, interested persons are invited to 
submit comments on this proposed rule, including the regulatory and 
informational impacts of this action on small businesses.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: 
www.ams.usda.gov/MarketingOrdersSmallBusinessGuide. Any questions about 
the compliance guide should be sent to Laurel May at the previously 
mentioned address in the FOR FURTHER INFORMATION CONTACT section.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposal. Thirty days is deemed appropriate because 
this rule would need to be in place as soon as possible since handlers 
are already shipping tart cherries from the 2011-12 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.

Sec.  930.256  Final free and restricted percentages for the 2011-12 
crop year.

    The final percentages for tart cherries handled by handlers during 
the crop year beginning on July 1, 2011, which shall be free and 
restricted, respectively, are designated as follows: Free percentage, 
88 percent and restricted percentage, 12 percent.

    Dated: February 28, 2012.
Robert C. Keeney,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 2012-5171 Filed 3-1-12; 8:45 am]
BILLING CODE 3410-02-P


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