-1-



## S UMMARY OF 

## P UBLIC 

## C OMMENTS FOR

THE 

## N OTICE OF 

## P ROPOSED 

## R ULEMAKING 

## : T HE 

## 2007 C RITICAL 

## U SE 

## E XEMPTION FROM THE 

## P HASEOUT

OF 

## M ETHYL 

## B ROMIDE

1. SUMMARY OF COMMENTS RELATING TO THE PROPOSED CRITIC AL USES AND

ADJUSTMENTS TO CRITICAL USE AMOUNTS................

................................................... .............................2

1. A

. P ROPOSED C RITICAL U SES

................................................... ................................................... ....................2

1. B

. L IMITING C RITICAL C ONDITIONS

................................................... ................................................... ..........3

2. SUMMARY OF COMMENTS RELATING TO CRITICAL NEED FOR M ETHYL BROMIDE.........10

2. A

. M ARKET T RANSITION TO S ULFURYL F LUORIDE

................................................... .....................................10

2. B

. A DOPTION OF O THER A LTERNATIVES

................................................. E RROR ! B OOKMARK NOT DEFINED

.

3. SUMMARY OF COMMENTS RELATING TO EMISSIONS MINIMIZAT ION ...................................23

4. SUMMARY OF COMMENTS RELATING TO CRITICAL USE ALLOWA NCE ALLOCATIONS...26

5. SUMMARY OF COMMENTS RELATING TO TOTAL VOLUMES OF CR ITICAL USE METHYL

BROMIDE............................................

................................................... ................................................... ................27

6. SUMMARY OF COMMENTS RELATING TO INVENTORY OF METHYL BROMIDE ...................30

6. A

. P ROPOSED I NCREASED I NVENTORY R ELIANCE

................................................... .......................................30

6. B

. P ROPOSED S TRATEGIC I NVENTORY

................................................... ................................................... .....35

6. C

. A CCOUNTING FOR I NVENTORY AND D ISCLOSURE OF I NVENTORY I NFORMATION .....................................37

7. SUMMARY OF COMMENTS RELATING TO RULEMAKING AND THE REGULATORY

PROCESS............................................

................................................... ................................................... .................38-2-



### 1. Summary of Comments Relating to the PROPOSED CRITIC AL USES

AND ADJUSTMENTS TO CRITICAL USE AMOUNTS

1.a. Proposed Critical Uses

Commenter Organization Document ID No Doug Sharp Plum Creek 0106 Dr. Scott Enebak Southern Forest Nursery Management Cooperative 0107 Tom Anderson Plum Creek Shubuta Nursery 0109 Ken McQuage Plum Creek Timber Co. – Pearl River Nur sery 0110 Gene Harrington National Pest Management Associatio n 0134 Glen Fischer California Pepper Commission 0135

• Four commenters state that the Members of the South ern Forest Nursery Cooperative were not listed as Approved Critical Users, even though other consortium members were listed as in previous rules. The commenters request that the proposed rule be amended to reflect the previous critical use exemption (CUE) Rules for App roved Critical User and Location of Use, which was:

-“Approved Critical Use: Forest Nursery Seedlings” -“Approved Critical User and Location of Use: Membe rs of the Southern Forest Nursery Management Cooperative limited to growing l ocations in Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas and Virginia.” [0106, 01 07, 0109, 0110]

Response: EPA agrees with some of the changes proposed by the Southern Forest Nursery Management Cooperative. The Cooperative filed a cr itical use exemption application with EPA and the forest seedling sector was approved by the Parties as an agreed critical use category for 2007. Therefore, EPA is correcting the Table of Ap proved Critical Users to reflect this consortium. However, EPA is not adding the state o f Kentucky

. To qualify as an “approved critical user” under the definition at 40 CFR 82.3, an entity must be a member of a consortium “that applied to EPA for a critical use exemption f or a use and location of use that was included

in the U.S. nomination” and that satisfies other cr iteria. In this instance, however, the application did not include Kentucky as a “location of use” and Kentucky was not a member of the consortium at the time of application.

• One commenter requests that EPA change the wording on p. 38346 of its proposed description of NPMA as a critical user from:

“Members of the National Pest Management Associatio n associated with dry commodity structure fumigation (cocoa) and dry commodity fumi gation (processed food, herbs and spices, dried milk and cheese processing facilities ).”

to:-3-

“Members of the National Pest Management Associatio n treating cocoa beans in storage and associated spaces and equipment and processed food, cheese, dried milk, herbs and spices and spaces and equipment in associated processing f acilities.” [0134]

Response: EPA agrees with the commenter and has incorporated this suggestion in the Final Rule, because it clarifies that commodities shall b e fumigated as part of space fumigations.

1.b. Limiting Critical Conditions

Commenter Organization Document ID Number David Doniger Natural Resources Defense Council 012 2, 0122.1 John B. Mueller Fumigation Service & Supply, Inc. 0 127, 0127.1 Bruce Houtman Dow AgroSciences LLC 0132, 0132.1, 01 32.2

Craig Weyandt Florida Golf Course Superintendents

Association 0133

• Two commenters address the “market disruption” cond ition required by Decisions IX/6, XVI/2, and Ex. II/1:

− One commenter believes that the proposed rule lacks the market disruption finding, noting that, according to the Decisions, “uses cann ot qualify as ‘critical’ unless the nominating party has established that ‘the lack of availability of methyl bromide for that use would result in a significant market disruption .’” The commenter believes that EPA does not provide “meaningful support” for its claim s of market disruption. [0122]

Response: Parties to the Protocol have considerable discret ion in their application of the “significant market disruption” concept. The pream ble to the Final Rule discusses EPA’s application of the significant market disruption co ncept. EPA’s Office of Pesticide Programs (OPP) conducts the analytical basis for EPA’s criti cal use nominations (CUN) to the Protocol. These nominations include a thorough sector-specifi c analysis of the economic feasibility of methyl bromide alternatives. Factors considered in these economic analyses include yield losses, market windows and crop rotations. The 2007 CUN ch apters are available on the docket for this rule (EPA-HQ-OAR-2005-0538). In general, for secto rs in which EPA determines that no economically feasible alternatives are available, E PA infers that the absence of methyl bromide would result in a significant market disruption. E PA’s interpretation of economic feasibility is included in the memorandum entitled “Development of 2003 Nomination for a Critical Use Exemption for Methyl Bromide for the United States of America,” available on the docket for this rulemaking (EPA-HQ-OAR-2005-0538). The Methyl Bromide Technical Options Committee (MBTOC) thoroughly reviews EPA’s economic analysis in the CUNs.

− One commenter states that the CUE application for t he Florida Golf Course Superintendents Association (FGCSA) was rejected be cause of a failure to demonstrate that the loss of methyl bromide would result in a m arket disruption. The commenter believes that the term “market disruption” is undef ined by EPA and states that the product of the golf industry is the playing field r ather than a crop yield. [0133]

Response: Supporting technical and economic data are required for securing critical use exemptions. After a lengthy review of the FGCSA ap plication and subsequent requests for-4-

additional information, EPA economists were unable to support the argument that a significant market disruption would occur if golf courses inclu ded in the FGSCA application were unable to use methyl bromide. An important part of EPA’s det ermination was that it did not find that a lack of methyl bromide would result in significant revenue losses for the golf course industry.

EPA did nominate 78,040 kg of critical use methyl b romide for 254 hectares of sod turfgrass production. Methyl bromide was only nominated for use in production of certified sod. The price of non-certified sod is roughly 75% lower tha n certified sod. EPA did not find that a lack of methyl bromide would cause a significant market disruption in the non-certified sod market. Similarly, EPA has not found that a lack of methyl bromide would create a significant market disruption in the golfing industry, because it did not find a strong link between methyl bromide use and golf industry revenues. Subsequently, FGCS A has offered to provide EPA with survey information about the relationship between demand f or golf and poor course conditions. EPA

will continue to consider all relevant information for future nominations.

• One commenter states that it is unclear what object ive basis EPA uses to determine when and

how much “time to transition” to an alternative is required. According to the commenter, users already know which alternatives work for them , but there is no incentive to change when methyl bromide is readily available. The comme nter believes that the 15% transition rate does not reflect the reality of the market’s a bility to transition and recommends that a more rapid, expedited transition rate be establishe d to quickly reduce reliance on methyl bromide. [0132.1]

Response: In the 2006 Final Rule (71 FR 5989), a transition range of 12%-18% was estimated for sulfuryl fluoride for each structural sub-secto r. This projection was based on the 2008 Bromide Usage Newer Numerical Index (BUNNI), which was completed in January 2006. To gather additional information, on August 23, 2006 E PA issued additional data requests under Sec. 114 of the Clean Air Act to a small sample of flour millers and fumigant applicators that are familiar with sulfuryl fluoride and its efficacy. E PA will continue to seek the best available data regarding the economic and technical feasibility of alternatives and to integrate this data into its

transition rate estimates.

- The commenter also recommends that EPA properly def ine key terms such as “technical feasibility,” “economic feasibility,” an d “significant market disruption.”

The commenter believes that until there are domesti c definitions for these terms,

stakeholders will not understand the basis for whic h the U.S. has and will make CUE decisions, and the process will lack transparency. For guidance, the commenter suggests that Canadian definitions for these terms could be employed. [0132.1]

Response: EPA has not established a generic definition of “te chnical feasibility.” This is partly due to the wide range of sectors that participate i n the CUE application process. EPA’s understanding is that Canada also lacks a generic d efinition of technical feasibility. For more information on how technical feasibility is assesse d during the domestic review process, and the methodology employed by the Office of Pesticide Pro grams during the review of CUE applications, please refer to the detailed memorand um entitled “Development of 2003 Nomination for a Critical Use Exemption for Methyl Bromide for the United States of America,” available on the docket for this rulemaking (EPA-HQ -OAR-2005-0538). This memo also-5-

discusses EPA’s application of the economic feasibi lity and significant market disruption
concepts.

Parties have significant discretion in their applic ation of the significant market disruption concept. Canada has defined “significant market di sruption” as “the loss of an industry sector or production sector (e.g. one crop), not just the los s of one company or facility, unless a single company represents a large portion of the market.” 1 EPA agrees that given the discretion granted to Parties under the Protocol, the U.S. could adopt Canada’s definition, but the U.S. is not required to do so. EPA conducts a thorough sector specific analysis of economic feasibility in its critical use nominations (CUNs), which are publicly available on the docket for this rule making (EPA-HQ-OAR-2005-0538). Stakeholders are encourage d to consult the memo mentioned above, and past CUNs for a better understanding of how EPA applies these concepts.

- The commenter further recommends that EPA ensure ac curacy and validity of all limiting critical condition claims by requiring met hyl bromide critical users to provide documentation which forms the basis for the “reasonable expectations” that these conditions may arise. [0132.1]

Response: EPA uses the reporting and recordkeeping requiremen ts published in the Framework Rule (69 FR 76982) to ensure the accuracy and valid ity of information pertaining to limiting

critical conditions. The Framework Rule also detai ls the penalties for end-users, producers, importers, distributors, and applicators who do not follow the reporting requirements.

Pre-Plant Uses

• One commenter addresses the EPA-approved change in the karst label restrictions for 1,3-D products (i.e., the change in the restriction from a regional to site-specific limitation or prohibitions of product use in areas overlying karst topography compared to karst geology), as well as the series of 2005 MBTOC questions and U.S. government responses referred to in the proposed rule. In summ ary, the commenter states that the U.S. government attempted to evaluate the impact of the 1,3-D karst restriction label change approved by EPA in 2006 before the change wa s approved, and thus failed to predict, and therefore accommodate, the most import ant aspects of the change. The commenter states that as a result of this change, t he only remaining methyl bromide critical use nomination (CUN) justification associa ted with a 1,3-D karst restriction would be for applications that occur closer than 10 0 feet to the land features. According to the commenter, this restriction affects a much s maller percentage of agricultural land than the 8% to 40% claimed in the 2007 methyl bromi de CUN. Therefore, the commenter requests that: a) the 1,3-D karst restriction be re moved from the proposed 2007 methyl bromide allocation rule as a limiting critical cond ition; and b) that the U.S. Government conduct a post-hoc evaluation of this regulatory ch ange and its impact on the amount of methyl bromide that is exempted from phaseout in th e relevant use categories. [0132.1]

Response: EPA correctly anticipated that the label would chan ge from restricting 1,3-D use over karst geology, which underlies virtually all of Flo rida, to karst topographical features such as

1 Methyl Bromide Industry/Government Working Group , “Canada’s Process and Criteria for the Evaluation of Exemptions for Critical and Emergency Uses of Methy l Bromide,” http://www.ec.gc.ca/ozone/DOCs/SandS/mbr/EN/EX/inde x.cfm#FN2 , Accessed November 13, 2006-6-

sinkholes, caverns, springs and sinking streams. I n anticipation of this label change, EPA

conducted studies with officials from the State of Florida to estimate the extent of area affected by karst topographical features, and what proportio n of that land contains commercial operations that would, as a result, need critical use methyl b romide. EPA’s assessment did not consider the 100-foot buffer that was part of the label change. However, EPA considers critical use methyl bromide requests on an individual basis, but the U. S. nominates according to sector; therefore a post-hoc evaluation of this regulatory change, as r equested by the commenter, would not have a substantial impact on the 2007 critical use exempti on. The karst label restriction is only one of the limiting critical conditions for growers in the Southeast U.S. For example, a grower that may have been inaccurately assumed to be in a karst res tricted area may still have yellow and purple nutsedge, nematodes, disease infestation and Califo rnia geranium or cut-leaf evening primrose infestation, all of which are listed as limiting cr itical conditions in Table I of the preamble to the

Final Rule.

In addition, the 100-foot buffer is not the only us e restriction on the new 1,3-D label. There is a 24(c) registration for additional 1,3-D use restric tions in 31 Florida counties. These restrictions include: 1) "...use on soils that have a relatively shallow hard pan or soil layer restrictive to downward water movement (such as spodic horizon) wi thin 6 feet of the ground surface and capable of supporting seepage irrigation..."; 2) in ject as deep as possible but avoid subsurface irrigation water; 3) Must have Restricted Use Pesti cide license to apply.

For the reasons discussed above, EPA does not find it necessary to redo the 2007 CUE analysis, but the Agency is taking appropriate steps to updat e and further quantify its analysis of karst

label restrictions.

- This commenter also requests the removal of the fol lowing limiting critical conditions for pre-plant use since effective alternatives to m ethyl bromide are available:

Moderate to severe yellow or purple nutsedge infest ation – The commenter states that

Sandea  , Envoke  and Dual  Magnum, and metam-sodium, Treflan  , and Devrinol  when used in combination with 1,3-D, have proven ef fective for nutsedge control in tomato, pepper and other crops.

Response: As the 2007 CUN explains, research results confirm that methyl bromide alternatives provide inconsistent control of nutsedge weed speci es. Nutsedge is an extremely competitive weed in tomato fields and can cause significant yie ld losses in the Southeast. None of the alternatives recommended by the Methyl Bromide Tech nical Options Committee (MBTOC) provide sufficient nutsedge control at moderate-to- severe infestation rates in the Southeastern

U.S.

Moderate to severe nematode infestation – The commenter states that 1,3-D is widely recognized as a highly effective nematicide, and it s value has been demonstrated on numerous crops for more than 40 years

.
Response: As the 2007 CUN explains, methyl bromide is the onl y option to effectively control the target pests, which includes nematodes, found i n the Southeastern U.S. where pest pressures commonly exist at moderate to severe levels. In th e California strawberry sector, nematodes are-7-

among the target pests that must be controlled with methyl bromide at moderate to severe pressure. Methyl bromide applications in Californi a are typically made at 67:33, or where feasible, 57:43 mixtures with chloropicrin under pl astic mulch. It should be noted that the California strawberry sector has consistently reduc ed its methyl bromide requests since the inception of the CUE program.

Moderate to severe fungal disease infestation – The commenter states that Chloropicrin, either alone or in combination with other products including 1,3-D, is a viable methyl

bromide alternative that has demonstrated excellent control of soil-borne pathogens on

numerous crops.

Response: EPA is aware that Chloropicrin and 1,3-D can provid e adequate control of fungal pathogens in certain circumstances. However, there are circumstances in which methyl bromide is the only feasible option to control fungal disea se infestation. For example, orchard replant into previously planted orchard land (the typical situat ion in California) requires reducing pathogen populations (mostly nematodes and fungi) and nutrie nt sources of previous orchard tree roots and root remnants. This requires an effective material that is volatile and can penetrate into the soil to reach these plant materials. In sandy, loam soi ls, where restrictions do not apply, metamsodium and 1,3-D may be an acceptable alternative t hat can penetrate to the target areas. In other situations, this compound and other alternati ves are not able to move sufficiently through the soil to remove the problem pests. Thus, there is currently a critical need for MeBr in this situation. The infrequent use of methyl bromide fo r orchard replant and the positive benefits of vigorous early tree growth make methyl bromide a ke y component of orchard fruit and nut production in areas where alternative methods are n ot effective. There are similar situations for other pre-plant sectors which are described in more detail in the 2007 CUN and 2008 CUN.

- This commenter also discusses the following two pre -plant limiting critical

conditions:

Occupied structures – According to the commenter, this condition is likel y relevant only to the affected fraction and not the complete field . The commenter also believes that local buffer zone requirements like those imposed b y the California Dept. of Pesticide Registration (CADPR) alter the status and meaning o f “Occupied Structures” as a limiting critical condition.

Response: The 2007 CUN explains that U.S. estimates of the ar ea affected by 100 foot buffer zones are based on data from applicants and alterna tives manufacturers and include many factors. For example, the eastern U.S. has many sm all “pick-your-own” strawberry farms (less than 4 hectares) where the impact of a 30 meter buf fer is more pronounced than on the larger farms in California or Florida. Because of the sig nificant impact that these estimates have on the overall request for methyl bromide, EPA is evaluati ng additional methods to further substantiate and quantify the impacts of buffer zones.

Township limits – Using the CADPR’s “California Management Plan: 1,3- Dichloropropene” as an example, the commenter state s that the township limits on 1,3-D usage only become a limiting condition if the 1,3-D allocation limit within the given control year has been met for the particular townsh ip/range relevant to the specific

critical user. The commenter also states that since the institution of the plan in 2002, there-8-

have been less than 8 instances where growers withi n specific townships in California have been unable to use 1,3-D products due to towns hip cap allocations. [0132.1]

Response: EPA continues to support listing township caps as a relevant limiting critical condition for California crops. EPA is aware that this is a fluid rather than static situation and the availability of 1,3-D is contingent on other fu migation decisions made in these townships. There are many examples, such as sweet potato slip production, where township caps demand serious consideration. Given the preference of pro ducers of sweet potato slips for 1,3-D, if it is available, any methyl bromide will go unused if pos sible. In Merced County, California, there is an especially high concentration of crops that requ ire fumigation, particularly almonds, nectarines, peaches, and grapes. The above factors make predicting the availability of 1,3-D for sweet potato transplant production very difficult. Nevertheless, EPA continues to support the use of 1,3-D and other alternatives in areas where ther e is lighter pest pressure and where township cap limits have not been exceeded.

Post-Harvest uses

• Two commenters recommend that the limiting critical conditions described below be removed as they are no longer relevant. [0127.1, 01 32.1]. One commenter states that since the preparation of the 2007 CUNs, ProFume has super seded heat and phosphine as the preferred alternative in post-harvest use categorie s. [0132.1]

Response: Although phosphine does kill insects, it is corrosi ve to metals, especially copper and its alloys, bronze and brass. These metals are imp ortant components of the electronics that run the manufacturing equipment. Phosphine requires lo nger application time, which can be a severe economic concern for producers trying to meet key m arket windows. Resistance to phosphine has also been reported for several stored product p ests. Despite these concerns, EPA is pleased that phosphine is used in areas without electronics and where temperature is not a factor.

Sufficiently high temperatures will kill insects gi ven enough time; but heat sources are not a feasible option in all areas of the United States. Heat also causes rancidity in butters and oils and denatures proteins. EPA has determined that heat i s being used in areas where it is feasible.

Section 2.a. of this document discusses the efficac y of sulfuryl fluoride.

Older structures that can not be properly sealed – According to two commenters, the efficacy of different fumigants does not vary based on the quality of sealing and so a structure not capable of effective sealing has simi lar limitations whether fumigated with methyl bromide or an alternative. The commenters f urther state that sulfuryl fluoride has worked well in the fumigation of older structures. [0127.1, 0132.1] One commenter states that proper sealing is a “label requirement” of met hyl bromide and that older structures that cannot be sealed well should not be fumigated at all due to the potential risk to bystanders. [0127.1]

Response: EPA wishes to reiterate that the Nomination is only for those areas where the use of alternatives is not feasible. In addition, sanitat ion and IPM are used to manage pest populations and extend the time between fumigations. Meanwhile, EPA has encouraged all applicants to seal their structures, but recognizes that older food pr ocessing facilities, especially those constructed of wood, experience more frequent and severe pest i nfestations that must be controlled by some-9-

type of fumigation. In facilities where mites are present, such as in ham and cheese processing facilities, methyl bromide must be used, even if th e structure is properly sealed, because mites are not on the sulfuryl fluoride label. Facilities using methyl bromide are always required to follow regulatory guidelines to protect bystanders.

Presence of sensitive electronic equipment subject to corrosivity – Two commenters believe that this criterion exists only to address the alternative fumigant, phosphine. They

note that ProFume is not corrosive to sensitive ele ctronic equipment and since it is approved for post-harvest use, this condition shoul d not be a criterion for determining access to methyl bromide under the proposed rule. [ 0127.1, 0132.1]

Response: The corrosive nature of phosphine is one of the rea sons that methyl bromide is still necessary in some instances. Reductions in post-ha rvest critical use allowances made in the Final Rule account for the uptake of ProFume (a fum igant product consisting of sulfuryl fluoride).

Rapid fumigation – One commenter states that ProFume is capable of per forming rapid fumigations to the same extent as methyl bromide an d this criterion should thus be removed from the proposed rule. [0132.1]

Time to transition to an alternative – One commenter states that 10 years has been an adequate amount of time to transition to alternativ es. [0127.1]

Response: EPA’s numerical analysis of sulfuryl fluoride can b e found in the 2008 BUNNI, available on the docket for the Final Rule (EPA-HQ- 2005-0538). EPA continues to collect information regarding the efficacy of sulfuryl fluo ride. For example, in August 2006 the Agency received information, using its information collect ion authority under Section 114 of the CAA, from a sample of millers and fumigant applicators w ho have experience with sulfuryl fluoride and its efficacy. Sulfuryl fluoride is discussed i n more detail in Section 2.a. of this document.

While EPA continues to support the transition to me thyl bromide alternatives it does not support an artificial deadline for the phase-out of critica l use methyl bromide. The Montreal Protocol continues to allow for methyl bromide use when ther e are no technically or economically feasible alternatives. This is emblematic of the p ragmatic nature of the Protocol, which has contributed to its great success.

- The same commenter also states that the proposed ru le does not reflect the August 2006 EPA report titled “Tolerance Reassessment Repo rt of Food Quality Protection Act (FQPA) Tolerance Reassessment and Risk Manageme nt Decision (TRED) for Methyl Bromide, and Reregistration Eligibility Deci sion (RED) for Methyl Bromide’s Commodity Uses.” According to the commen ter, in this document, the EPA calls for additional regulatory restrictions on all uses of methyl bromide in the post-harvest use category, including buffer zones a nd reduced use rates. [0132.1]

Response: The comment period for the methyl bromide TRED and RED was extended to November 24, 2006 (71 FR 57505), and EPA is now rev iewing the comments received. Therefore, it would be inappropriate for EPA to con sider the TRED and RED in the Final Rule. EPA’s Office of Pesticide Programs (EPA/OPP) is the lead EPA program office for the re--10-

registration of methyl bromide as well as the methy l bromide CUNs. EPA/OPP will consider the impacts of the methyl bromide re-registration in fu ture CUNs.



### 2. Summary of Comments Relating to CRITICAL NEED FOR M ETHYL

BROMIDE

2.a. Market Transition to Sulfuryl Fluoride

Commenter Organization Document ID Number

James Bair North American Millers’ Association 0112 , 0112.1 Betsy Peterson CA Bean Shippers Association 0113 David A. Shorr Lathrop & Gage L.C. 0114 None Albemarle Corporation 0116, 0116.1 Stephen Payne Pet Food Institute 0118 Pamela Peckman The Industrial Fumigant Company 0119 Nancy Sandrof American Chemistry Council 0120, 0120 .1 Mark Reddick Reddick Fumigants, Inc. 0121, 0121.1 David Doniger Natural Resources Defense Council 012 2, 0122.1 Miguel Cea AG-Fume Service, Inc. 0123 Marcy Martin CA Grape & Tree Fruit League 0126 John B. Mueller Fumigation Service & Supply, Inc. 0 127, 0127.1 David Culp Dickson Chemical Co., Inc. 0128, 0128.1 Jim Garrett Fume Tech, Inc. 0129, 0129.1 Jack Coleman, Jr, Jeff Coleman, Stephen Roy, Keith Alvis Research Fumigation Company, LLC 0130, 0130.1

Roberta Firoved CA Rice Commission 0131, 0131.1 Bruce Houtman Dow AgroSciences LLC 0132, 0132.1, 01 32.2 David McAllister Chemtura Corporation 0136 Lynn Bragg Chocolate Manufacturers Association 0137 , 0137.1

Suresh Prabhakaran Dow AgroSciences LLC 0138, 0138.1, 0138.10, 0138.13, 0138.14, 0138.15, 0138.17, 0138.18, 0138.19, 0138.2, 0138.20, 0138.21, 0138.22, 0138.23, 0138.24, 0138.25, 0138.26, 0138.3, 0138.4, 0138.5, 0138.6, 0138.9

Edward Ruckert McDermott, Will & Emery for the Crop Protection

Coalition 0139

Dennis Balint CA Walnut Commission 0140, 0140.1

Steve Hensley USA Rice Federation 0141, 0141.1, 0141.2, 0141.3, 0141.4, 0141.5, 0141.6, 0141.7, 0141.8 Amy Schaffer Weyerhaeuser Company 0142 William Goodrich United Agribusiness League 0146 William Murray American Forest & Paper Association 0149

• Nine commenters believe that EPA’s proposed 12% to 18% transition rates for sulfuryl fluoride in post-harvest sectors are too high and t hat therefore post-harvest methyl bromide-11-

allocation cuts made “to reflect the continuing tra nsition to sulfuryl fluoride” are premature. [0112.1, 0113, 0114, 0116.1, 0118, 0119, 120.1, 012 1, 0123, 0136]

Response: In the Final Rule EPA reduced the total volume of critical use methyl bromide by 53,703 kilograms to reflect the continuing transiti on to sulfuryl fluoride. The Agency based the reductions on data contained in the 2008 BUNNI, whi ch was submitted to the Ozone Secretariat in January 2006 and is available in the docket for this rule. EPA believes that the 2008 CUN still represents the best available data on the transitio n to sulfuryl fluoride.

− Four commenters cite the Motion of Stay of the Effe ctiveness of Sulfuryl Fluoride Tolerances in the U.S. (EPA-EPA-HQ-2005-0174-0013) to back the assertion that it is “premature” for the EPA to rely on sulfuryl fluorid e. [0113, 0114, 0118, 0121]

− One commenter states that the regulatory and legal challenges behind the stay address violations of the FFDCA, APA, and FQPA, which, if s uccessful, could prevent the use of sulfuryl fluoride as a pesticide for at least a por tion of 2007. [0116.1] Another

commenter states that the establishment of toleranc es for the use of sulfuryl fluoride on food commodities under the FFDCA is being challenge d. [0120.1] An additional commenter also states that the regulatory status of sulfuryl fluoride is currently being challenged. [0112.1]

Response: If a stay is imposed on the effectiveness of pestic ide tolerances for sulfuryl fluoride and fluoride promulgated in January 2004 and July 2 005, EPA will adjust its analysis of methyl bromide CUEs accordingly. As of the date of signat ure on the Final Rule, no final action has been taken on the request for a stay of tolerances; therefore, the Final Rule assumes that the

tolerances will remain effective.

− One commenter states that data collection on the ef ficacy of sulfuryl fluoride in comparison to methyl bromide is just beginning this year and will continue over the next 3 years. The commenter requests that the EPA not m ake additional cuts in methyl bromide allocation until the potential alternatives have been thoroughly studied. The commenter provides multiple supporting documents. [ 0112.1]

Response: Critical use methyl bromide reductions to account f or the uptake of sulfuryl fluoride are based on EPA’s analysis in the 2008 BUNNI, whic h represents the best available data on the transition to sulfuryl fluoride. Since the 2008 CU N was published in February 2005, EPA has collected additional data on the efficacy of sulfur yl fluoride as a post-harvest fumigant. Most recently, in August 2006 EPA gathered additional da ta about sulfuryl fluoride use from a sample of millers and fumigators under the authority of Se c. 114 of the Clean Air Act. The reductions in

the Final Rule reflect EPA’s determination that the Agency’s current understanding of sulfuryl fluoride is strong enough to estimate the transitio n rate to this potential methyl bromide alternative. The Agency will continue to collect i nformation to update and strengthen its analysis of sulfuryl fluoride.-12-

− One commenter states that it is unclear whether EPA is still attempting to calculate the expected market uptake of sulfuryl fluoride, but th at this should be feasible based on required reported data on the use of methyl bromide . The commenter also states that in 2004 “EPA stated that it would take up to 5 fumigat ion cycles of use before the efficacy of sulfuryl fluoride could be determined in the spe cific circumstances of the user.” The commenter additionally requests that EPA identify t he specific post-harvest uses to which the 12% to 18% estimation was applied. [0120.1]

Response: EPA is attempting to calculate the expected market uptake of sulfuryl fluoride. Reported data on past sales of critical use methyl bromide is one type of data available to the Agency, but other data sources can be useful in pro jecting future uptake of alternatives.

Comments submitted to the docket for the Final Rule have been helpful in this regard. Most recently, in August 2006 EPA gathered additional da ta about sulfuryl fluoride use from a sample of millers and fumigators under the authority of Se c. 114 of the Clean Air Act. One purpose of this data collection was to estimate market uptake. EPA will consider this data in future rulemakings. While the Sec. 114 data consisted of a small sample, and the responses were all claimed confidential by the responding entities, th e variation in responses generally supported the assumptions made in developing the 2008 BUNNI. For example, while some users have had success with sulfuryl fluoride, others experienced increased costs because they used larger volumes of gas. However, before the BUNNI can be a djusted further, additional data is required with regard to the cost of fumigating with sulfuryl fluoride, the volume of gas required in each sub-sector, and the ability of sulfuryl fluoride to generate effective kill at egg stages.

To clarify, the 12-18% transition rate that the com menter refers to is an annual transition rate for post-harvest food processing facilities, and consid ers all registered chemical and non-chemical alternatives, one of which is sulfuryl fluoride. T he 12-18% transition rate is an annual rate. For example, as the 2008 BUNNI shows, EPA estimates tha t the North American Millers can transition 58% of their current critical use methyl bromide consumption to alternatives, with a 12% per year rate of transition. In addition, EPA also notes that the post-harvest sector is not the only sector in which the 2008 BUNNI considers trans itions to registered chemical and nonchemical alternatives. For example, the BUNNI incl udes a 5% per year transition rate for
Florida strawberries and a 4% annual transition rat e for Georgia eggplant.

EPA applied the 12% to 18% annual transition rate r eferred to in the Final Rule to the following post-harvest sub-sectors: processed foods (17%), sp ices/herbs (17%), cocoa (17%), rice millers (18%), pet food (15%), bakeries (14%), and NAMA (12 %). These transition rates were calculated in the 2008 BUNNI, which is available in the docket to this rule (EPA-HQ-OAR2005-0538).

− One commenter states that too many concerns about s ulfuryl fluoride exist for it to be situated to become a viable alternative to methyl b romide. [0123]

Response: EPA accounted for concerns with sulfuryl fluoride i n the 2008 CUN and 2008 BUNNI. Current obstacles to the uptake of sulfuryl fluoride are also discussed below in this

document.-13-

• One commenter states that adjustments for the use o f sulfuryl fluoride were already taken into account in the initial 2007 CUE applicat ions, and does not understand why EPA increased expectations of sulfuryl fluoride use from those numbers. The commenter also states that current sulfuryl fluorid e use is being substantially subsidized by the manufacturer and that additional investigation and analysis to determine the economic feasibility of the product i s needed. [0139]

Response: The CUE reductions EPA is making for the use of s ulfuryl fluoride are based on the data contained in the 2008 CUN, which is available on the docket for the Final Rule (EPA-HQOAR-2005-0538). This analysis still represents the best available data on the transition to sulfuryl fluoride, including factors such as potent ial obstacles in the export of treated commodities. EPA understands that the 2007 CUE app lications adjusted for sulfuryl fluoride to some degree. The Agency used the applications as a valuable source of information to start the 2007 CUE allocation process. Other sources of data used in developing the CUN and the BUNNI include data submitted by the registrant and fumigation companies, in addition to data compiled by USDA researchers. In the Final Rule E PA used the best available data, from the 2008 CUN, to make adjustments for sulfuryl fluoride . However, in reviewing the calculations in the proposed rule, EPA noted one instance of double -counting which had been applied to the milling sector. Therefore the overall sulfuryl flu oride uptake amount was revised from 68,170 to 53,703 kilograms.

− Two commenters stress that sulfuryl fluoride is nota methyl bromide substitute for preplant fumigations, and therefore reductions should apply only to post-harvest users and the total volume available to pre-plant uses should remain unchanged. [0142, 0149]

Response: In the CUE Framework Rule (69 FR 76982) EPA created two distinct types of methyl bromide critical use allowances (CUAs): CUAs for pr e-plant soil uses and CUAs for postharvest and structural uses. EPA agrees with the c ommenter that at this time sulfuryl fluoride is only a technically and economically feasible altern ative in the post-harvest, commodity and structural sectors. Therefore, the transition to s ulfuryl fluoride did not affect EPA’s allocation of pre-plant critical use allowances in the Final Rule

.

− One commenter believes that sulfuryl fluoride is no t meeting expectations as an alternative. [0146]

• Five commenters contend that EPA provides no factua l basis for the 12% to 18% sulfuryl fluoride transition estimate [0120.1, 0126, 0132.1, 0142, 0149].

Response: EPA’s most recent analysis of the transition rate to sulfuryl fluoride is contained in the 2008 CUN and 2008 BUNNI, which are available in the docket for the Final Rule (EPA-HQOAR-2005-0538).

− One commenter states that while sulfuryl fluoride m ay have potential as a commodity treatment, it is unclear whether it will hold up un der commercial use. The commenter believes that EPA should “investigate more thorough ly to determine what the economic feasibility of the product truly is.” [0126]-14-

Response: EPA’s analysis recognizes that significant hurdles currently exist in the commodities sector that constrain the economic feasibility of s ulfuryl fluoride. These hurdles include: (1) many U.S. trading partners have not yet registered sulfuryl fluoride, (2) the relatively high price of sulfuryl fluoride at this time, (3) industry ine xperience with sulfuryl fluoride, and (4) research suggesting that higher concentrations of sulfuryl f luoride are required in colder temperatures and to kill egg-stage insect pests. EPA will continue to seek the best available data regarding the economic and technical feasibility of sulfuryl fluo ride, and to integrate this data into its analyses.

− A second commenter suggests that EPA “poll those in dustries that have the opportunity to use sulfuryl fluoride and identify those who can and will convert, and if not, why not.” [0142]

Response: On August 23, 2006, EPA issued letters to a sample of fumigation and flour milling operations under Section 114 of the CAA in order to obtain better data to support its sulfuryl fluoride transition estimates. EPA may use the dat a obtained from the Section 114 responses in future rulemakings and we will continue to consider additional sulfuryl fluoride research data.

- One commenter states that sulfuryl fluoride has not been tested in real time circumstances for the commenter’s time sensitive industry and the refore more time is needed to determine its efficacy and use potential before fur ther restricting methyl bromide use. [0140]

Response: EPA’s most recent analysis acknowledges factors in the walnut industry that challenge the economic feasibility of sulfuryl fluo ride. For example, many major export markets have not established tolerances for sulfuryl fluori de use on walnuts. Because walnuts are fumigated as they leave the field, and before they are segregated into export and domestic use, the use of sulfuryl fluoride will continue to be re stricted until the tolerances for sulfuryl fluoride

on walnuts are established.

- Four commenters state that 2008 CUN nomination docu ments do not provide adequate evidence for the advanced role sulfuryl fluoride ma y play as a future alternative and go on to cite multiple instances in the document to su pport this claim. [0113, 0118, 0121, 0136] Five commenters also cite an internal EPA ev aluation document in regard to the limitations of sulfuryl fluoride (Memorandum from C . Cook to D. Hufford entitled “Evaluation of the Ability of Sulfuryl Fluoride (Pr oFumeTM) to Replace Methyl Bromide in Post-Harvest Uses, Document No. EPA-HQ-OAR-2005- 0538-088). [0113, 0118, 0121, 0136, 0141]

Repsonse: As the internal EPA memo (EPA-HQ-OAR-2005-0538; doc ument number 088) indicates, EPA is aware that circumstances exist in which sulfuryl fluoride is a less effective methyl bromide alternative. For example, very high concentrations of sulfuryl fluoride are required to kill egg stage pests in cold temperatur es. Similarly, the 2008 CUN acknowledges that EPA has limited economic data on sulfuryl fluo ride’s performance relative to methyl bromide. To gain more of this type of data, on Aug ust 23, 2006, EPA issued letters under Section 114 of the CAA to a sample of fumigation an d flour milling operations that have-15-

experience with both methyl bromide and sulfuryl fl uoride. While the 114 responses consisted of a very small sample, there was some variation am ong the responses with regard to comparative costs.

The commenters state instances where EPA recognized areas where it needs to collect more information about sulfuryl fluoride. The 2008 CUN analysis, which estimates a 12-18% sulfuryl fluoride transition rate for 2007, was made in ligh t of the Agency’s current data limitations. In other words, the information EPA has collected supp orts an estimated 12-18% transition rate. Transition rates were only estimated for sectors in which sulfuryl fluoride is registered, and where there are data demonstrating that key pests a re controlled by sulfuryl fluoride. As the Agency collects more information about sulfuryl flu oride it will revise this estimate accordingly.

− Three commenters highlight the 2008 CUN nomination document claims, among them that implementation of sulfuryl fluoride, if feasib le, will occur gradually, that fumigation with sulfuryl fluoride at lower temperatures is ine ffective, and that the requirement for only “incidental fumigation” for processed foods is not always possible. [0118, 0121, 0136]

Response: The 2008 CUN and 2008 BUNNI considered the points r aised by the commenter about the feasibility of sulfuryl fluoride as a met hyl bromide alternative, and estimated a 12-18% transition rate to sulfuryl fluoride in 2007.

• Eight commenters support the use of sulfuryl fluori de for post harvest applications. [0122, 0127.1, 0128.1, 0129.1, 0130.1, 0132.1, 0137.1, 013 8.1] Five commenters state that the fumigant is an alternative to methyl bromide alread y being adopted by the marketplace and has been used successfully at several rice mills. [ 0127.1, 0128.1, 0129.1, 0130.1, 132.1] Two commenters believe that sulfuryl fluoride should be able to displace more than the proposed 15% of the structural uses of methyl bromide in 200 6. [0132.1, 0122] One commenter states that initial use of ProFume has shown promise for f umigation of cocoa beans and would like to see continued “science-based regulatory progress in this regard.” [0137.1]

− One commenter details ProFume’s qualities in compar ison to methyl bromide, discussing efficacy, economics, and precision. The commenter believes that ProFume can compete with methyl bromide in all of these categories. [01 29.1]

Response: EPA’s 2008 CUN and 2008 BUNNI use the best availabl e data to discuss characteristics of sulfuryl fluoride and other circ umstances that currently limit sulfuryl fluoride’s technical and economic feasibility as a methyl brom ide alternative. EPA continues to support research and other efforts to improve the viability of alternatives to methyl bromide.

− One commenter states that sulfuryl fluoride’s stron g penetrating ability makes it more effective in the fumigation of old wooden structure s than methyl bromide. [0127.1]

Response: EPA appreciates the commenter’s point about the pen etrating ability of sulfuryl fluoride. Data indicates that heat improves the ef ficacy of sulfuryl fluoride as a structural fumigant. However, the 2008 CUN notes that heat ma y not be suitable for wood frame buildings-16-

or commodities with high oil content, because in th ese situations heat may foster the development of rancidity. The 2008 CUN is availabl e on the docket for this Final Rule (EPAHQ-OAR-2005-0538).

− One commenter believes that ProFume is capable of r eplacing 94% of all current postharvest methyl bromide uses [0132.1, 0138.1], and t wo commenters claim that it can replace all post-harvest uses by December 31, 2007. One commenter calls for a quicker implementation of greater amounts of sulfuryl fluor ide in post-harvest uses and proposes a reduction in 2007 methyl bromide CUEs exceeding t he proposed 68,170 kgs “in recognition of the regulatory and market advances o f ProFume”. [0132.1]

Response: EPA’s analysis in the 2008 CUN does not support the conclusion that ProFume is capable of replacing 94% of all post-harvest methyl bromide uses, at least not as soon as 2007.

The 2008 CUN and 2008 BUNNI use the best available data to discuss characteristics of sulfuryl fluoride and other circumstances that currently lim it sulfuryl fluoride’s technical and economic feasibility as a methyl bromide alternative. Some of these limitations are discussed above in this

document.

− Two commenters state that ProFume is registered in all 50 states as well as in “key countries outside the U.S.” [0132.1, 0138.1], and one commenter provides details regarding its registration status in various states as well as the Maximum Residue Limits (MRLs) approval status as per the Codex Alimentariu s Commission. [0132.1]

Response: EPA appreciates the information provided by this co mmenter. The information about additional countries establishing MRLs may be consi dered in future analyses.

− One commenter states that ProFume provides broad sp ectrum, all life stage pest control, and does not deplete the ozone layer. The commenter cites and attaches 19 documents to support these assertions. The documents address: “ SPIP Rebound before and after fumigation, Flour Beetle activity in a mill, SF Vs MB fumigation comparison, ProFume field bioassay, ProFume fumigation of rice mills in California, Commercial performance of ProFume, Commercial performance of ProFume detai l, Red Flour Beetle monitoring after MD Fumigations, USDA Research Paper, Economic s of commercial ProFume fumigations, Canadian ProFume PMRA registration eff icacy evaluation, Development of Sulphuryl Fluoride in China, U.S. Cocoa Manufacture r’s Association, Testimonials & Letters of Support, Current ProFume Registration St atus, ProFume commercial summary data, Fumigation Economics, ProFume retreat facts, and Commercial case studies.” [0138.1]

Response: EPA appreciates the technical information provided by this commenter. EPA’s Office of Pesticide Programs will consider the data provided by the commenter in future analyses of sulfuryl fluoride’s potential as a methyl bromid e alternative.

The Agency continues to study the efficacy of sulfu ryl fluoride as a “broad spectrum, all life stage pest control.” Published literature reports that at lower temperatures a greater concentration of sulfuryl fluoride is necessary to kill eggs of the stored product insect pests-17-

(Memorandum from C. Cook to D. Hufford entitled “Ev aluation of the Ability of Sulfuryl Fluoride (ProFumeTM) to Replace Methyl Bromide in Po st-Harvest Uses, Document No. EPAHQ-OAR-2005-0538-088).

− One commenter states that “phase-out timetables are intended to accelerate the market penetration of alternatives” but that market penetr ation of sulfuryl fluoride is inhibited by the continued availability of methyl bromide for us es that sulfuryl fluoride could address.

The commenter believes that the environmental issue at stake (protection of the ozone layer) should enable an accelerated rate of market penetration of alternatives. [0122]

Response: Based on the assessment performed for the 2008 BUN NI and the 2008 CUN, which are available on the docket for the Final Rule (EPA -HQ-OAR-2005-0538), a transition rate of
between 12%-18% reflects the best available data on the feasible uptake of sulfuryl fluoride in the affected portions of the industry. EPA believe s that the projected uptake in 2008 and subsequent years under a business-as-usual scenario can be achieved earlier by removing the corresponding amount of methyl bromide from the app roved critical use level, for the affected

sectors. This enables an accelerated rate of marke t penetration as compared to a scenario with no reductions in critical use methyl bromide.

− Another commenter asserts that the pace of phaseout should not be left wholly to the “market” to determine and that the phaseout rate sh ould be purposefully driven by the
EPA. The commenter also states that more than 25% o f the grain milling market has already demonstrated success using ProFume. The com menter recommends that future re-evaluation of a methyl bromide alternative shoul d permit consideration of increasing the displacement percentage and that methyl bromide consumers submitting an allocation request to the EPA should also be required to provi de 1) an estimation of a “Transition to a methyl bromide alternative” timeline and 2) the c onditions necessary to meet the timeline. [0132.1]

Response: EPA does not believe that the pace of the phaseout is entirely market driven. Methyl bromide is a heavily regulated substance, and the U nited States Government continues to

intervene in the market to accelerate the transitio n to alternatives through regulation, research, and other means. Based on the assessment performed for the 2008 BUNNI of the 2008 CUN, which are available on the docket (EPA-HQ-OAR-2005- 0538), a transition rate of between 12%-
18% reflects the best available data on the feasibl e uptake of sulfuryl fluoride. EPA believes that the projected uptake in 2008 and subsequent years u nder a business-as-usual scenario can be achieved earlier by removing the corresponding amou nt of methyl bromide from the approved critical use level. This is an example of how EPA can affect market conditions to accelerate the transition to methyl bromide alternatives.

EPA requires that critical use applications include extensive information about methyl bromide alternatives, including plans for future research o f potential alternatives. EPA will continue to consider public comments regarding the critical use exemption application process.

• One commenter believes that sulfuryl fluoride has t he potential to replace methyl bromide for some, but not all, applications. The commenter sta tes that sulfuryl fluoride is successfully-18-

used to fumigate mill structures for the California rice industry, reducing reliance on methyl bromide, but that methyl bromide still must be used to fumigate products shipped in wood floor shipping containers since sulfuryl fluoride h as a tendency to penetrate wooden material. [0131.1]

• Seven comments expressed concerns related to the sa fety, efficacy, and/or trade limitations associated with the use of sulfuryl fluoride. [011 4, 0116.1, 0119, 0120.1, 0136, 0140, 0141]

Response: EPA’s estimated transition rate accounts for the li mitations listed by the commenters. The 2008 CUN explicitly notes that safety, efficacy and trade regulations impede the uptake of methyl bromide alternatives, such as sulfuryl fluor ide. EPA believes that the 2008 CUN still represents the best available data on the transitio n to sulfuryl fluoride,, which also accounted for potential transition barriers and therefore did not include an uptake amount for the commodites sector due to export market concerns.

− Four commenters cite recent health concerns about t he safety of sulfuryl fluoride on food products. [0114, 0116.1, 0119, 0136] Three comment ers state that a recent study published by the National Research Council (Nationa l Academy of Sciences) raises

serious health concerns associated with the use of fluoride. [0116.1, 0136, 0141]

Response: EPA is aware of the National Research Council study , and is monitoring developments regarding sulfuryl fluoride tolerances . Since no final action has been taken with regard to a stay of sulfuryl fluoride tolerances, i n the Final Rule EPA assumed those tolerances will remain effective. If a stay is imposed, EPA w ill adjust its analysis accordingly.

− Three commenters state that there are few or no int ernational tolerances for sulfuryl fluoride. Thus, food grown using sulfuryl fluoride generally cannot be shipped to other countries. [0116.1, 120.1, 140]

Response: EPA is aware that many major U.S. trading partners have not established tolerances for sulfuryl fluoride, which restricts its use. Th ese limitations were considered in the 2008 CUN

and 2008 BUNNI.

- One commenter expresses concern that some fumigatio ns with sulfuryl fluoride are not in compliance with current interpretations of the sulf uryl fluoride label. The commenter also states that the uptake of sulfuryl fluoride is 2 to 3 times lower than the uptake of methyl bromide, and therefore 2 to 3 times more mus t be used for equal efficacy. [0119] A second commenter also addresses the shortcomings of the current ProFume label. [0141]

Response: EPA would be interested in further details that the commenter can provide about fumigations with sulfuryl fluoride that are not in compliance with current interpretations of the

label.

EPA’s analysis recognizes that sulfuryl fluoride is temperature dependent and that higher concentrations are necessary to kill egg-stage pest s, especially when temperatures are low.-19-

• One commenter gives a more detailed explanation of why sulfuryl fluoride uptake has not kept pace with EPA’s expectations, including:

Efficacy: The commenter states that sulfuryl fluoride is a we ak ovicide, and therefore two fumigations must be done (the second to kill th e emerged insects that were still eggs at the time of the first fumigation), increasing th e price of use, compared to the one fumigation necessary with methyl bromide. The com menter also states that ProFume does not penetrate as deeply into stored grain as m ethyl bromide when the grain requires a top-down fumigation, and the resulting multiple f umigations required with ProFume in such situations (e.g. when grain is transported on barges) are prohibitively costly and time consuming. Additionally, the commenter states that one mill that performed a ProFume fumigation found live insects immediately f ollowing the fumigation.

Temperature: The commenter states that sulfuryl fluoride fumig ation success rates are comparable to methyl bromide rates (excluding egg e radication) at 80 ° F, however if the temperature is below that level, sulfuryl fluoride rapidly loses efficacy and thus more of the gas is needed.

Response: In the 2008 CUN, EPA notes that sulfuryl fluoride i s temperature dependent, and that to kill eggs requires higher concentrations except at optimal temperatures.

Sealing: The commenter states that because sulfuryl fluori de has a much higher vapor pressure than methyl bromide, it is difficult to “h old” in a building even with a good seal.

Response: The difficulty of “holding” sulfuryl fluoride shows up in economic data, because applicators will be forced to use more sulfuryl flu oride to achieve acceptable results. EPA will

continue to consider this as it collects more infor mation regarding the efficacy of sulfuryl

fluoride.

Label Problems: The commenter states that the sulfuryl fluoride r egistration is not as “robust and clear” as the methyl bromide label and believes that this leaves fumigators and millers unsure of whether they are using sulfur yl fluoride in accordance with regulations. The commenter also states that the Pr oFume label does not allow for the presence of certain ingredients that are warehoused in bulk in mills along with the targeted grain and cannot be removed. Additionally , the ProFume label does not cover some major pests, and many state regulations theref ore prevent mills that contain those pests from using ProFume.

Response: The 2008 CUN acknowledges that many mills produce p roducts that are not listed on the current label. Although the label allows “inc idental” fumigation, the mills will need to move the products so that they are not fumigated. Adopt ion of sulfuryl fluoride will be delayed for some of these mills, where the products listed on t he label cannot be removed, until tolerances for these ingredients are sought by the registrant, reviewed by EPA, and granted (if they meet eligibility criteria). EPA addresses these issues in further detail in an internal memo that is available on the docket (Memorandum from C. Cook to D. Hufford entitled “Evaluation of the-20-

Ability of Sulfuryl Fluoride (ProFumeTM) to Replace Methyl Bromide in Post-Harvest Uses” (EPA-HQ-OAR-2005-0538-088).

Tolerances: The commenter addresses the lack of tolerance in export markets for sulfuryl fluoride. The commenter states that the u se of sulfuryl fluoride in another country does not automatically mean that U.S. commo dities receive tolerances and can be exported to those countries. The commenter also st ates that the FAO Codex has not historically established a tolerance for sulfuryl f luoride, and has recently only by shortening the multi-year review process, which lea ves Codex and EPA “open to attack” and puts “the future of sulfuryl fluoride in doubt. ” The commenter cites the relevant sources regarding other countries.

Response: EPA is aware that many major U.S. trading partners have not yet established tolerances for sulfuryl fluoride, which restricts i ts use. These limitations were considered in the

2008 CUN.

Cost, Dosage, and Other Issues: The commenter states that in order to have a succes sful fumigation at an “All Life Stages” (ALS) dosage, ov er twice as much ProFume is needed as methyl bromide. This increased dosage will caus e mills to surpass the 10,000 pound limit and thus force them into Form R reporting to EPA under the EPCRA, adding burden

and cost to the use of ProFume. The commenter stat es that to fumigate at a Post Embryonic Plus (PEP) dosage, killing only post-egg life stages, the fumigations performed each year would double, bringing the pric ing up to that of an ALS treatment. The commenter states that the price of ProFume is a lso affected by the large dosages needed to counteract its dissipation through struct ural materials as well as higher freight costs due to higher weights and higher labor costs due to the additional setup requirements such as piping, fan placement, extra s ealing, and the tearing down of those fixtures or payment for permanent piping. The comm enter states that ProFume does have the benefits of smaller non-occupied buffer zones a nd quicker venting of the gas. [0141]

Response: The 2008 CUN includes economic analysis of alternat ives, including sulfuryl fluoride. EPA is actively collecting additional da ta on the economics of sulfuryl fluoride. Most recently, in August 2006 EPA gathered additional da ta about sulfuryl fluoride use from a sample of millers and fumigators under the authority of Se c. 114 of the Clean Air Act. As stated above, the responses to the 114 inquiry demonstrated a var iety of results when comparing the costs of methyl bromide and sulfuryl fluoride. While the 11 4 requests did not comprise part of the BUNNI technical assessment, EPA may use the data in future rulemakings.

2.b. Adoption of Other Alternatives

Commenter Organization Document ID Number

Steve Godbehere None 0117 Stephen Payne Pet Food Institute 0118 Mark Reddick Reddick Fumigants, Inc. 0121, 0121.1 David Doniger Natural Resources Defense Council 012 2, 0122.1 Richard Matoian CA Fig Advisory Board 0124

Michal Mellano CA Cut Flower Commission 0125-21-

Bruce Houtman Dow AgroSciences LLC 0132, 0132.1, 01 32.2 Craig Weyandt Florida Golf Course Superintendents A ssociation 0133 Glen Fischer California Pepper Commission 0135 David McAllister Chemtura Corporation 0136 Don Stringfield Tree Improvement 0144 George Lowerts International Paper 0145 Peter Joyce Value Recovery, Incorporated 0115

• Seven commenters believe that EPA should maintain t he current amount of critical use methyl bromide until “technically and economically feasible alternatives” are readily available, as directed by the Montreal Protocol. T he commenters also state that if alternatives were available, the volume of critical use applications would have decreased, as the cost of submitting a complete application is hi gh. [0117, 0118, 0121, 0124, 0125, 0133, 0136]

Response: EPA reiterates that critical use exemptions are on ly for those areas where technically and economically feasible alternatives are not avai lable.

• One commenter contends that while EPA stated in 199 3 that alternatives would be available before the phase-out occurred in 2005, no new alter natives are available for many pre-plant soil uses despite over $100 million spent on resear ch. The commenter illustrates this assertion with a photograph of unhealthy pine seedl ings that are receiving a lower dose of methyl bromide than in previous years in response t o reduced supply and increased costs. [0117]

Response: The 2007 CUN was based on careful and robust analys is, and was for those areas

where alternatives are not feasible. The commenter is correct that substantial resources have been devoted to finding methyl bromide alternatives . The United States Government alone has invested over $150 million in this research effort. Private sector investment in research has also been significant. Thanks in part to this research, and to the successful implementation of alternatives and pest management practices, the Uni ted States nomination for critical use methyl bromide for 2007 was 29% of the 1991 consumption ba seline, and for 2008 it was 25% of the

1991 baseline.

• Five commenters believe that traditional phase-out models cannot be applied to methyl
bromide. One commenter stated that EPA should not “apply an industrial phase-out model to agricultural chemicals or an international phase-out model to domestic conditions.” The commenters state that methyl brom ide’s unique role presents phase-out challenges, including finding alternatives that wil l prove effective when applied directly

to the environment and used in various climatic and pest conditions, and concurrently finding alternatives that are less toxic than methy l bromide. The commenters also state that developing and implementing agricultural alter natives in the U.S. is a lengthy process due to the country’s large size, broad rang e of crops produced, and unique labor force. [0118, 0121, 0125, 0136, 0145] Additionally , one of the commenters also states that the same principles of complexity as noted abo ve for agriculture apply to methyl bromide use in industrial structural fumigations. [ 0118]-22-

Response: At 40 CFR 82.3 the definition of critical use refer s to the lack of technically and economically feasible substitutes and alternatives that “are suitable to the crops and circumstances involved.” Thus, the methyl bromide critical use criteria are tailored specifically to the challenges faced by methyl bromide users.

− One commenter specifically states that the model of replacing CFCs as refrigerants is not applicable to replacing methyl bromide with alterna tives due to the complicating factor of matching its reactive properties. [0115]

• One commenter states that no alternatives currently available are as effective at controlling disease and pathogens as well as methyl bromide. [0 144]

Response: Due to the variety of crops and circumstances fac ed by methyl bromide users, EPA analyzes methyl bromide alternatives on a use-speci fic basis. If EPA finds that an economically feasible and technically feasible alternative exist s for a specific methyl bromide use, that use does not qualify as a “critical use” as defined at 40 CFR 82.3. This is true even if methyl bromide is the most effective option for controllin g disease and pathogens given the crop or circumstances in question.

• One commenter states that existing alternatives to methyl bromide for the commenter’s purposes are well researched and objects to the rej ection of CUE applications due to lack of research provided when “there is nothing new on the market to research.” [0135]

Response: The commenter is referring to the 2008 CUE applicat ion submitted by the California Pepper Commission (CPC), in which the CPC did not p rovide priorities for future research on methyl bromide alternatives. The 2007 CUN notes th at for pepper production in California, chloropicrin, 1,3-D, metam-sodium, water management , and plant varieties will continue to be tested for efficacy against P. capsici and other soil-born pathogens. In the CPC’s 2009 critical use application, the CPC listed five alternative ch emicals or cultural practices worthy of testing. Therefore, EPA does not agree with the commenter th at there is nothing left to research. In the absence of new products on the market, methyl bromi de users could test methods for using methyl bromide more efficiently, including emission minimization options.

Production and consumption of methyl bromide for cr itical uses is only permitted if it is demonstrated that an appropriate effort is being ma de to evaluate alternatives and substitutes.

• One commenter states that EPA has not accounted for alternatives other than sulfuryl fluoride in its proposal. The commenter states tha t EPA acknowledges that the review associated with the development of the U.S. nominat ion was written two years prior to the year of exemption, and therefore situations where n ew alternatives have become available may warrant a post-hoc review. [0122]

Response: EPA’s Final Rule relies on the best available data. This information is primarily found in the 2008 CUN, which is available on the do cket for this Final Rule (EPA-HQ-OAR2005-0538) where all relevant substitutes and alter natives are considered.-23-

• One commenter expresses dissatisfaction with EPA’s delay in implementing a transition to alternatives. The commenter states that this delay has affected his organization’s ability to generate a return on its significant investments in research and development of alternatives. According to the commenter, the delay not only resu lted in spending additional time and money to continue repetitive research, but also fur ther slowed interest in adoption of alternatives. [0132.1]

Response: In an effort to speed adoption of alternatives, the U.S. government has invested over $150 million in research on potential methyl bromid e substitutes and alternatives. Promotion of alternatives through education and extension, robus t testing of alternatives and assessment of alternatives continue to be EPA priorities.



### 3. Summary of Comments Relating to EMISSIONS MINIMI ZATION

Commenter Organization Document ID Number David McAllister Chemtura Corporation 0136 Amy Schaffer Weyerhaeuser Company 0142 George Lowerts International Paper 0145 Peter Joyce Value Recovery, Incorporated 0115

• Two commenters believe EPA should continue to encou rage emission minimization without mandating the use of emissions control technology. The commenters believe that fundamental questions remain regarding the technica l, economic, and regulatory feasibility of many of the emissions control measures currently on the market and that it is too early to

make decisions on further reductions to CUE volumes based on research trials. [0136, 0145]

Response: EPA continues to encourage the use of emissions min imization techniques and notes that the critical use exemption application contain s a worksheet on emissions reduction.

• One commenter expresses concern that “EPA has not a ssisted in technology transfer in identifying new beneficial alternatives and managem ent techniques.” The commenter believes that many methyl bromide users are unaware of the newly available high-barrier films or the reasons why it has taken so long to de velop glues that will work with virtually impermeable films (VIF) in flat fume situations. T he commenter suggests that EPA facilitate improvements by communicating the availability of b eneficial alternatives and publicizing results of critical research in a timely manner. [0 142]

Response: EPA agrees with the commenter that technology trans fer is an important aspect of the transition to methyl bromide alternatives. The Met hyl Bromide Alternatives Outreach (MBAO) conference includes industry, growers, researchers and government, and meets once a year to share the results of methyl bromide alternatives re search. MBAO has included research about emissions minimization technologies such as VIF and metalized films, and these technologies continue to be a focus of MBAO. For example, the 2 006 MBAO conference included five expert presentations on the subject of mulch film and emis sion reduction. More information about MBAO and the 2006 conference in Orlando, FL can be found at http://www.mbao.org/ . The 2006 Conference was sponsored by MBAO with cooperat ion from EPA, The Crop Protection Coalition and the U.S. Department of Agriculture.-24-

• One commenter believes that the potential for emiss ions reduction of methyl bromide is great, but that barriers of “power, politics, commo n sense, leadership, and will” (rather than technology or economics) stand in the way of the im plementation of existing technologies. The commenter states the following barriers:

− The commenter states that the main barrier to adopt ion of emissions controls is the lack of commercial incentives for industry to use emissi ons control technology for pre-plant, post-harvest, or QPS applications. The commenter a cknowledges the existence of an incentive specifically targeted to soil, however. The commenter believes that if an entity can verify that it used methyl bromide but did not emit it into the atmosphere (i.e. through reuse, recycling, or chemical destruction), then th at use should not be deducted from the entity’s CUE. The commenter asserts that the Clean Air Act and Montreal Protocol support this approach. [0115]

Response: As a Party to the Montreal Protocol, the United Sta tes is committed to eliminating emissions of ozone-depleting substances (ODS) by me eting its phaseout targets for ODS production and consumption. The phaseout approach of replacing methyl bromide with alternatives is supported by Decision IX/6, which s tates that certain uses of methyl bromide are only considered critical if the lack of availabilit y of methyl bromide for those uses would result in a significant market disruption and if no techni cally or economically feasible alternatives exist. It is expected that as new alternatives are developed, fewer uses will be considered critical under Decision IX/6, and indeed, since 2005, the le vel of critical use methyl bromide nominated by the U.S. and approved by the Parties to the Prot ocol has decreased. To that end, since recycling/reclamation of methyl bromide is not cons idered new production or consumption, emissions control technology may have an increasing ly important role to play in recapturing and recycling/reclaiming methyl bromide for continued u se as new production/consumption allowances become more limited over the coming year s. Additionally, EPA strongly encourages the use of emissions minimization techniques, and n otes that the critical use exemption application contains an emission reduction workshee t.

− According to the commenter, a second barrier is the nine month delay in the production, subsequent limited availability, and poor quality o f a reporting form for data on emissions control technology mandated by the Montreal Protoco l through Decision 17/9 and CRP10 at the 25 th OEWG meeting in June, 2005. The commenter furthe r states that the form, once completed, was never responded to by the Montr eal Protocol and that the commenter was denied the opportunity to present the data at a side session of the 2006 OEWG meeting, in violation of Article IX, Paragraph 1(a). The commenter requests EPA’s help in addressing this issue with the Protoc ol.

The U.S. submitted a report to the Ozone Secretaria t in accordance with Decision XVII/11 on June 20, 2006, regarding the efficacy, logistical i ssues and economic feasibility of technologies to recapture, recycle, destroy, or reduce methyl br omide emissions from fixed facilities. The U.S. report to the Parties contains very detailed i nformation on the capture and phase transfer catalysis technology developed by the commenter, an d is available on the docket for this action, EPA-HQ-OAR-2005-0538.-25-

While this comment is outside the scope of this rul emaking, EPA notes the commenter’s concern and is open to discussing this issue further with t he commenter.

− The commenter states that a third barrier is the mi sperception that emissions controls would lessen the incentive to develop alternatives. The commenter responds that: (1) even if the argument were true, it is not a problem since the atmosphere is still protected either way; (2) manufacturers have already had 14 y ears to develop alternatives; and (3) in response to claims that users who adopt emission s control methods will be reluctant to give up methyl bromide when it is completely phased out, that methyl bromide is unlikely to ever be completely phased out and that policies directed toward that end “serve no public purpose.” The commenter further s tates that since there are only 4 authorized methyl bromide suppliers in the U.S., th ey do not face any competitive incentive to lower prices or, thus, increase their sales, e.g. by supporting emissions

controls.

Response: While strongly encouraging the use of emissions min imization techniques, EPA remains committed to the phase-out of methyl bromid e. As noted in the preamble of Final Rule, EPA believes that by reducing supply through the ph aseout there is an inherent incentive to use the ever-diminishing quantities of methyl bromide m ore effectively, thus inducing methyl

bromide users to limit emissions.

- The commenter additionally summarizes the following recommendations for commercial incentives for the implementation of methyl bromide controls: (1) introduce a system where users report the amount of methyl bromide use d, destroyed after use, and emitted, and provide access to increased sources of methyl b romide; (2) publish methyl bromide emissions data from users on an annual basis to giv e them incentive to gain a marketing edge based on using stated green technologies; (3) publish a “drop-dead rate” approximately 5 years in the future where a minimum of 50% of methyl bromide use

must be contained in emissions-control use or else prohibited; and (4) allow new methyl bromide competition into the U.S., providing incent ives for new suppliers to add value to their product through emissions control.

- The commenter further states that commercial-scale demonstrations of methyl bromide

use and instantaneous destruction have been success ful and that the system used is affordable and readily available. [0115]

Response: EPA appreciates the commenter’s recommendations, an d the Agency will consider them as it continues to encourage the use of emissi ons minimization techniques, while focusing on the phaseout of methyl bromide.

EPA remains committed to identifying and promoting ways in which methyl bromide emissions can be minimized from fumigation applications; howe ver, the commenter’s proposed recommendations [#1, #2, and #3 above and page 19 t hrough page 22 of the original comment #0147] are outside the purview of this EPA rulemaki ng.-26-

In response to recommendation #4 [paragraph 4 above and page 22 original comment #0147], the price of methyl bromide is determined by market forces of supply and demand, and because only a certain amount of new production/consumption is approved by the Parties, EPA limits the supply of newly produced/imported methyl bromide. As a result, it is highly likely that prices for methyl bromide are higher than those that would be experienced were there no cap on new production. With regard to the number of methyl bro mide manufacturers, there are a limited number of sources of elemental bromine needed to pr oduce methyl bromide and a very limited number of companies that are capable of producing m ethyl bromide. Of those few companies capable of producing methyl bromide, even fewer are actually producing methyl bromide based on each company’s assessment of whether such produc tion is profitable and/or is necessary to meet customer agreements under contract.

Because supply of newly produced methyl bromide is already restricted by the CUE levels approved by the Parties to the Protocol, and given the constraints related to access to bromine, the market for producing methyl bromide is a decrea sing one, not likely to attract new manufacturers. Emissions control technologies shou ld be of interest, however, to methyl bromide users who could recover and recycle/reclaim methyl bromide for reuse and thereby avoid purchasing new methyl bromide.



### 4. Summary of Comments Relating to

TWO-SECTOR APPROACH TO CRITICAL USE ALLOWANCE

ALLOCATIONS

Commenter Organization Document ID Number Betsy Peterson CA Bean Shippers Association 0113 Nancy Sandrof American Chemistry Council 0120, 0120 .1 Mark Reddick Reddick Fumigants, Inc. 0121, 0121.1 Bruce Houtman Dow AgroSciences LLC 0132, 0132.1, 01 32.2 David McAllister Chemtura Corporation 0136 Amy Schaffer Weyerhaeuser Company 0142

• According to five commenters, the current two-secto r critical use allocation approach is preferable over switching to a sector-specific appr oach and should be continued by EPA

because it is consistent with the manner in which t he methyl bromide market currently operates, and is easier to implement from a logisti cal and administrative standpoint. [0113, 0120.1, 0121, 0136, 0142]

Response: EPA is maintaining the current two-sector allocatio n approach in the Final Rule.

• One commenter believes that critical use and critic al stock allocations should be allocated specifically to each of the Critical Use Categories as authorized by the Parties. The commenter states that other countries have already established use-specific allocation

methods. The commenter believes that the U.S.’s “l ump sum” approach does not guarantee that approved critical users will have access to me thyl bromide and allows users with the greatest ability to pay to block access for critica l users. Further, the commenter believes that the “lump sum” approach delays the transition to al ternatives and does not provide EPA with-27-

any ability to keep excessive methyl bromide from u sers whose uses have successful alternatives. The commenter requests that if EPA d oes not adopt a use-specific approach,

that it at least maintain the current two-sector al location system. [0132.1]

Response: Approved critical users may only purchase methyl b romide for approved critical uses. Therefore, there is a limited ability for cr itical users to “block access” for other critical users by hoarding methyl bromide, as the commenter suggests. While it is theoretically possible that approved critical users could somehow get bloc ked from purchasing methyl bromide, the Agency is unaware of that happening, and believes t hat it would be an unlikely outcome of the current allocation system.

As the preamble of the Final Rule discusses, althou gh the universal approach does not directly allocate allowances to each category of use, EPA an ticipates that reliance on market mechanisms will achieve similar results indirectly. The UN Te chnology & Economic Assessment Panel (TEAP) recommendations are based on data submitted by the U.S., which in turn are based on recent historic use data in the current methyl brom ide market. In other words, the TEAP recommendations agreed to by the Parties are based on current use patterns and the current use patterns take place in a market where all pre-plant and post-harvest methyl bromide uses compete for a lump sum supply of critical use mater ial. Therefore, the Agency expects that under a system of universal allocations the actual critical use will closely follow the sector breakout listed by the TEAP.

EPA determined in the final Framework Rule (69 FR 7 6989) that the universal allocation was the most efficient and least burdensome approach that w ould achieve the desired environmental results, and that a sector-specific approach would pose significant administrative and practical difficulties. A summary of the options analysis co nducted by EPA, which contributed to EPA’s decision in the Framework Rule to adopt the current system, is discussed in the Regulatory Impact Analysis (EPA-HQ-OAR-2005-0538-0086) availab le on the docket for the Final Rule. The majority of commenters continue to favor the cu rrent universal allocation system as a straightforward approach with minimal administrativ e burden.



### 5. Summary of Comments Relating to TOTAL VOLUMES O F CRITICAL

USE METHYL BROMIDE

Commenter Organization Document ID Number

B. Sachau None 0101

James Bair North American Millers’ Association 0112 , 0112.1 None Albemarle Corporation 0116, 0116.1 Stephen Payne Pet Food Institute 0118 Nancy Sandrof American Chemistry Council 0120, 0120 .1 Mark Reddick Reddick Fumigants, Inc. 0121, 0121.1 David Doniger Natural Resources Defense Council 012 2, 0122.1 Miguel Cea AG-Fume Service, Inc. 0123 Richard Matoian CA Fig Advisory Board 0124

Michal Mellano CA Cut Flower Commission 0125 Craig Weyandt Florida Golf Course Superintendents A ssociation 0133 David McAllister Chemtura Corporation 0136-28-

Edward Ruckert McDermott, Will & Emery for the Crop Protection

Coalition 0139

William Goodrich United Agribusiness League 0146 Peter Joyce Value Recovery, Incorporated 0115

• One commenter asserts that a phaseout of methyl bro mide will not contribute to a reduction in ozone depletion. The commenter states that meth yl bromide used for fumigation contributes only 0.075% of ozone depletion and beli eves that this amount has no bearing statistically. The commenter cites WMO’s Scientific Assessment of Ozone Depletion: 2002 and attaches a summary table using data from this r eport. The commenter further believes that the phaseout of methyl bromide may cause envir onmental damage. [0121]

Response: EPA has addressed these comments in Section V.E. of the preamble to the Final Rule.

• One commenter believes that there are no critical u ses for methyl bromide and that its use should be fully banned. [0101]

Response: Methyl bromide production and consumption was phase d out in the U.S. on January 1, 2005. However, the Clean Air Act allows EPA to establish exemptions for critical uses of methyl bromide.

• One commenter believes that the phaseout of methyl bromide runs counter to the principles of integrated pest management (IPM) by reducing the number of available pest management tools. [0112.1]

Response: While EPA acknowledges the benefits of IPM, the Age ncy remains committed to upholding the Montreal Protocol and Title VI of the Clean Air Act, which share the goal of reducing and eliminating the production and consump tion of ozone depleting substances, such as methyl bromide.

- The commenter further expresses dissatisfaction wit h the downward adjustments from the baseline-adjusted value to account for “do uble counting” on the part of the applicants. The commenter states that applican ts have already made voluntary cuts in their requests based on knowledge of altern atives, and thus when EPA makes cuts based on the same information they too a re guilty of double counting and should make upward adjustments in allocations t o account for this. [0112.1]

Response: As the commenter states, EPA does not allow applica nts to double-count their needs for critical use methyl bromide. The same logic ap plies to critical use reductions made by EPA. In making methyl bromide reductions to account for the transition to sulfuryl fluoride the Agency has taken care to avoid double-counting redu ctions. The Agency has done this by accounting for the initial reductions made for sulf uryl fluoride by applicants in their critical use applications.

CUE applications are an important starting point in the CUE allocation process. All steps in the allocation process, including the CUN, MBTOC recomm endations, and authorization by the Parties, represent fresh consideration of these app lications. The preamble of the Final Rule states-29-

that “The report of the MBTOC indicated that the MB TOC did not make any reductions in these use categories for the uptake of sulfuryl fluoride in 2007 because the United States Government

indicated that it would do so in its domestic alloc ation procedures. Therefore, EPA is reducing the total volume of critical use methyl bromide to reflect the continuing transition to sulfuryl fluoride.” Thus, EPA’s reductions, which are based on the analysis in the 2008 CUN, were made from CUE amounts approved by MBTOC, which did not a lready include reductions for the uptake of sulfuryl fluoride.

• Eleven commenters object to EPA’s proposed maximum allowable amount of methyl
bromide to be used for critical uses in 2007 on the grounds that it is lower than required by the Parties to the Montreal Protocol. [0116.1, 0118 , 0120.1, 0121, 0123, 0124, 0125, 0133, 0136, 0139, 0146]

Response: EPA’s proposed maximum allowable amount of methyl b romide is less than the amount identified by the Parties to the Protocol fo r two reasons. First, events that occurred after the nomination process were considered in the Final Rule. More specifically, the report of the Methyl Bromide Technical Options Committee (MBTOC) indicated that MBTOC did not make reductions for the uptake of sulfuryl fluoride in 2 007 because the United States Government

indicated that it would do so in its domestic alloc ation process. This accounts for the 53,703- kilogram reduction in critical use methyl bromide i n the Final Rule to reflect the uptake of sulfuryl fluoride. Second, as described in the Dec ember 23, 2004 Framework Rule (69 FR 76997), EPA is not permitting entities to build inv entories of methyl bromide produced or imported under the critical use exemption program. To prevent the buildup of such inventories, any volumes of methyl bromide produced or imported under the critical use exemption in a calendar year, but not used in that year, must be r eported to EPA the following year. These reporting requirements appear at §§82.13(f)(3)(xvi) , 82.13(g)(4)(xviii), and 82.13(bb)(2)(iii). An amount equivalent to this “carry-over,” whether pre -plant or post-harvest, is deducted from the total level of allowable new production and import in the year following the year of the data
report.

− Six commenters state that the use amount allowed by the Parties already represents a 50% reduction of the amounts of methyl bromide requeste d by users in their applications and an additional 30% reduction that was applied during the international review process. [0118, 0121, 0124, 0133, 0136, 0146]

Response: 2007 requests for critical use methyl bromide were over 60% of the 1991 baseline. After thorough technical and economic analysis desc ribed in the 2007 CUN, the United States
Government nominated 29% of baseline for 2007. As described in more detail in the preamble of the final rule, the Parties to the Montreal Prot ocol authorized the equivalent of 26.4% of

baseline for 2007 critical uses. For reasons descr ibed above and in the preamble of the Final Rule, further reductions were taken to account for the transition to sulfuryl fluoride and for “carry over” critical use methyl bromide not used i n 2005. The final rule allocates amounts of critical use methyl bromide equivalent to 24.4% of baseline (with 7.5% coming from prephaseout inventory).-30-

− One commenter states that the allocation level appr oved by the Parties is nearly 10% below the EPA’s CUN submitted for 2007 allocations, which the EPA stated at the time was the minimum amount of methyl bromide needed by the U.S. for critical uses in 2007, though the EPA now proposes to further decrease the amount available. [0116.1]

- One commenter states that approximately 65% to 70% of the 1991 baseline for methyl bromide is still needed compared to the 29% allowed level for 2007. [0115]

Response: Thorough economic and technical analysis of the app lications received, as reflected in the 2007 CUN, resulted in a U.S. nomination of a pproximately 7,403 metric tons of methyl bromide (or 29% of 1991 baseline) to meet U.S. crit ical uses in 2007. Critical use methyl bromide is only for uses for which feasible economi cal and technical alternatives do not exist.

• One commenter objects to the pending proposal to pr ovide a petition process for expanding the allowable production/import amount above the cu rrent proposed levels and believes instead that production and import should be decrea sed to account for the large inventory.

This commenter also states that total usage data fo r 2003 is lower than the amounts requested

for critical uses in 2005 and 2006. The commenter believes that total usage data for 2004 is also lower, but states that this data is not yet av ailable from EPA. The commenter believes that the aggregate usage data are “more reliable th an use-by-use data,” which is currently used for post hoc assessments of technological and economic feasibility, and expresses concern over the undisclosed use-by-use data source s. [0122]

Response: EPA is not finalizing the proposed petition proce ss at this time. Comments regarding inventory are addressed in the next secti on of this document. EPA’s estimates of use vary by approach (top-down v. bottom-up, etc.). Th e amount of CUE methyl bromide requested

was the result of a robust technical and economic a nalysis undertaken for every sector, and did not include additional growth. For additional info rmation on use estimates, see the Response to Comment document for the Framework rule (pp. 7-8) a vailable on the docket for that rule (EPAHQ-OAR-2003-0230).



### 6. Summary of Comments Relating to INVENTORY OF ME THYL

BROMIDE

6.a. Proposed Increased Inventory Reliance

Commenter Organization Document ID Number Doug Sharp Plum Creek 0106 Dr. Scott Enebak Southern Forest Nursery Management Cooperative 0107 Tom Anderson Plum Creek Subuta Nursery 0109 Ken McQuage Plum Creek Timber Co. – Pearl River Nur sery 0110 Betsy Peterson CA Bean Shippers Association 0113 None Albemarle Corporation 0116, 0116.1

Steve Godbehere None 0117-31-

Stephen Payne Pet Food Institute 0118 Pamela Peckman The Industrial Fumigant Company 0119 Nancy Sandrof American Chemistry Council 0120, 0120 .1 Mark Reddick Reddick Fumigants, Inc. 0121, 0121.1 David Doniger Natural Resources Defense Council 012 2, 0122.1 Miguel Cea AG-Fume Service, Inc. 0123 Richard Matoian CA Fig Advisory Board 0124

Michal Mellano CA Cut Flower Commission 0125 Bruce Houtman Dow AgroSciences LLC 0132, 0132.1, 01 32.2 Craig Weyandt Florida Golf Course Superintendents A ssociation 0133 David McAllister Chemtura Corporation 0136

Edward Ruckert McDermott, Will & Emery for the Crop Protection

Coalition 0139

Steve Hensley USA Rice Federation 0141, 0141.1, 0141.2, 0141.3, 0141.4, 0141.5, 0141.6, 0141.7, 0141.8 Amy Schaffer Weyerhaeuser Company 0142 Tom Starkey Southern Forest Nursery Management Coop 0143 Don Stringfield Tree Improvement 0144 George Lowerts International Paper 0145 William Goodrich United Agribusiness League 0146 William Murray American Forest & Paper Association 0149

• Fourteen commenters express concern about the propo sal to increase reliance on existing inventory of methyl bromide. These commenters stat e that the proposed increase in the amount of methyl bromide to come from inventory is beyond the level approved by the Parties and that an adequate emergency stockpile mu st be maintained. [0113, 0116.1, 0117, 0118, 0119, 0120.1, 121, 0124, 0133, 0136, 0142, 01 45, 0146, 0149]

Response: In the NPRM, EPA proposed to allocate critical stoc k allowances (CSAs) for 2007 critical uses in an amount equal to either 6.2% or 7.5% of the 1991 baseline (25,528,000 kilograms). In the Final Rule the Agency is alloca ting CSAs equal to 7.5% of baseline. Section V.G. of the preamble to the Final Rule describes th e reasons for this action.

Section V.C. of the preamble to the Final Rule also includes options EPA will consider if the Agency learns of a severe inventory shortage.

− Six commenters object to the EPA proposed CUA and C SA amounts because they incorporate methyl bromide for alternatives researc h and development programs into the critical use stock allocations, in addition to goin g beyond the requirements of the Parties. The commenters also object to the lack of scientifi c basis for the greater reliance on inventory than is required. [0120.1, 0136, 0139, 01 43, 0144, 0145] One commenter strongly believes that methyl bromide used for rese arch purposes should not divert from the amount of methyl bromide allocated to CUE holde rs. [0141]

Response: Section V.G. of the preamble to the Final Rule desc ribes EPA’s reasons for allocating 1,914,600 kilograms (7.5% of baseline) of critical use methyl bromide from inventory.-32-

− Five commenters believe the increased reliance on i nventory “puts critical use sectors in jeopardy” and claim that there is no technical basi s to increase the dependence on inventory at a time when the size of the methyl bro mide stockpile is decreasing. Further, these commenters state that EPA made the argument i n July 2005 that “the Protocol does

not require the use of existing stockpiles of methyl br omide before new production and consumption are allowed under the Article 2H critic al use exemption.” [0113, 0118, 0121, 0124, 0136]

Response: EPA is not requiring the use of all existing stockp iles before allowing new production and consumption. Section V.G. of the preamble to th e Final Rule describes EPA’s reasons for the

2007 CSA amount.

− Four commenters address the competition between cri tical users and non-critical users for stockpiles of pre-phaseout methyl bromide and state that the competition for these inventories could result in a lack of methyl bromid e availability for critical users. [0118, 0120.1, 0121, 0136]

Response: In the Framework Rule (69 FR 76982) EPA establishe d the current system in which only critical users may access newly produced and i mported critical use methyl bromide. Critical users may also purchase critical use methy l bromide from inventories from suppliers that hold critical stock allowances. However, EPA is aw are of the commenters’ concern that a severe inventory shortage could result in a lack of methyl bromide availability for critical users. Previously, EPA has proposed possible actions in th e event of a severe inventory shortage, but the Agency has not made a final decision about what course of action it would take.

Section V.G. of the preamble to the Final Rule disc usses options EPA may consider if there is a severe inventory shortage. “If the Agency is infor med of a severe inventory shortage, [EPA] may consider various options including, but not lim ited to, promulgating a final version of the petition process proposed on October 27, 2005 (70 F R 62030), taking into account comments received on that proposal; proposing a different ad ministrative mechanism to serve the same purpose; or authorizing conversion of a limited num ber of CSAs to CUAs through a rulemaking, bearing in mind the upper limit on U.S. production/ import for critical uses.” EPA is not implementing any of these options in the Final Rule

.

EPA’s concern regarding the potential consequences of a severe inventory shortage is one of the reasons the Agency sought comment in the NPRM on wh ether, in the critical use exemption context, it would be appropriate to adjust the leve l of new production and import with the goal of maintaining a stockpile of some specific duration i n order to sustain non-disruptive management of methyl bromide in the supply chain as inventorie s are reduced over time. EPA has not made a final decision regarding the management of inventor y for a specific duration. The preamble to

the Final Rule notes that EPA “intends to continue exploring the issue in future rulemakings, particularly in the context of the 2008 critical us e exemption.”

− One commenter expresses concern over depleted inven tory levels compared to 2002 estimations, citing a 50% decrease. The commenter believes that EPA has underestimated the amount of methyl bromide needed to respond in the event of an-33-

emergency, stating that a 9 month supply would be n eeded to bring a currently closed methyl bromide factory back online as opposed to EP A’s 100 day estimate. The

commenter also believes that the stock should also be sufficient to alleviate minor supply issues. As a result, the commenter asserts that th e stockpile should be increased rather than depleted. Further, the commenter opposes EPA’ s “alternative CSA proposal” set forth in Table II.b. of the Proposed Rule on the gr ounds that there is no scientific basis for the proposed 1,936,302 kg stock allocation. [01 16.1]

Response: In the preamble to the Final Rule EPA notes that t he Parties to the Protocol did not take a decision on an appropriate amount of invento ry for reserve purposes at their 18 th Meeting, held during October 30-November 3, 2006. Nor has E PA reached any conclusion regarding what amount might be appropriate. EPA appreciates the commenter’s input regarding the amount of time it would take to bring a currently c losed methyl bromide factory back online. EPA will continue to explore the appropriate amount of reserve inventory.

EPA’s rationale for proposing to allocate 1,936,302 kg of critical use methyl bromide from inventory in 2007 is discussed in the preamble to t he Final Rule, and above in this document. In the final rule, the CSA calculations were also slig htly adjusted in order to reflect exactly 7.5% of

baseline.

− One commenter states that existing methyl bromide i nventory was produced legally and has no increased impact on the ozone layer. This c ommenter also states that the inventory is needed as a safety net in case the nee ds of the market surpass the production sanctioned by EPA. [0117]

Response: The commenter’s conclusion regarding the environmen tal effects of existing inventory is addressed in the response to comments document for the Framework Rule. EPA has addressed comments regarding the need for a safety net in the preamble of the final rule.

− One commenter states that EPA’s increased reliance on existing inventory compared to their original allocation in Decision Ex. XVII/9 is inconsistent with their previous

actions. The commenter refers to the 2005 Allocati on rule, for which EPA argued “that the Party’s allocation should stand as is, stating that the UNEP decision relevant to the

2005 U.S. Allocation ‘indicates the total amount of the United States critical use need that should be met from inventory in 2005.’” [0136]

Response: EPA does not agree that proposing to allocate 1,936 ,302 kilograms (7.5% of 1991 baseline) of methyl bromide from available inventor y is inconsistent with previous Agency actions. Beginning with the 2006 CUE allocation, E PA has exercised its discretion to adjust the portion of critical use methyl bromide to come from exempted production or import as compared to the portion to come from pre-phaseout inventory (71 FR 5998). This continues to be an appropriate means of carrying out U.S. commitments as expressed in Decisions Ex. II/1 and

XVII/9.

• Four commenters argue that the amount of methyl bro mide allocated under the CUE process has not been sufficient to meet grower demand since EPA and the Montreal Protocol Meeting-34-

of the Parties significantly cut the amount request ed by the forest nursery sector. The

commenters believe that these cuts and the increase d reliance and use of methyl bromide inventory have created market uncertainty, methyl b romide shortages, and methyl bromide price increases (46% increase for Forest-Nursery se edling growers). The commenters also state that the high price of methyl bromide has res ulted in the use of alternative fumigants that have not been thoroughly tested. In order to stabilize the cost of methyl bromide while economical and viable alternatives are identified, the commenters request that: (a) EPA limit the use of methyl bromide inventory to the lower am ount (1,621,702 kilograms) for the 2007 CUE; and (b) for the 2008 CUE, EPA and the Departme nt of State try to limit MBTOC’s requirements to use methyl bromide inventory as par t of the U.S. CUE allocation process. [0106, 0107, 0109, 0110]

Response: EPA appreciates the commenter’s input regarding t he price of methyl bromide. The Agency continues to monitor methyl bromide prices a s an indicator of shortages. EPA’s rationale for proposing to allocate 1,936,302 kg of critical use methyl bromide from inventory in 2007 is discussed in the preamble to the Final Rule , and above in this document.

• One commenter believes that EPA’s proposal to incre ase reliance on inventory “is not consistent with earlier announcements that put thes e supplies outside the realm of critical use exemption quotas.” [0123]

Response: EPA has addressed these comments above in this docu ment.

• One commenter states that “EPA should not be includ ing the use of inventory in any of the current or future rulings,” and states that invento ries have dropped dramatically over the past 3 years. [0125]

Response: EPA has addressed this comment above and in the pre amble to the final rule.

• Two commenters believe inventory should be only for critical use needs, and that therefore access to pre-phaseout methyl bromide inventory sho uld be denied to non-critical users and restricted for critical users to prevent “double di pping,” as per the Montreal Protocol and

Decisions. These commenters also believe that alth ough reliance on inventory in the proposed rule is increased from previous years, the amount remains too low. The commenters believe that EPA should preferentially u se the existing stockpiles to support CUEs and not allow any new production or importatio n unless the inventory is not sufficient to meet critical needs. [0122, 0132.1]

Response: EPA has responded to these comments in the preamble to the final rule.

− One commenter states that the preferential use of i nventory is per the Decisions of the Montreal Protocol, and states that the proposal ack nowledges “that the existing inventory is more than adequate to meet the proposed 6.2-7.5% gap between production/import and consumption.” [0122]-35-

− The second commenter contends that any under-predic tion of available inventory should be corrected by the exchange of critical use alloca tions (CUAs) for critical stock allocations (CSAs). The commenter states that the utilization of existing inventory first is

in accordance with Decision IX/6. The commenter be lieves that the proposed rule should state that “the retirement of CUAs in exchange for CSAs shall be required” to prevent any additional methyl bromide production from addin g to available inventory at the end of the control period. The commenter believes that this revision would minimize the production of new ODS while ensuring the availabili ty of methyl bromide for critical uses. [0132.1]

Response: EPA has responded to comments regarding its interpr etation of Decision IX/6 in previous Federal Register notices and in the Respon se to Comments Document for the Framework Rule, available on the docket for that ru le (EPA-HQ-OAR-2003-0230) as well as in the preamble to the 2007 CUE Final Rule.

In the NPRM, EPA stated that if an inventory shorta ge occurs, EPA may consider various options including, but not limited to, promulgating a final version of the petition process proposed at 70 FR 62030, taking into account commen ts received on that proposal; proposing a

different administrative mechanism to serve the sam e purpose; or authorizing conversion of a limited number of CSAs to CUAs through a rulemaking , bearing in mind the upper limit on U.S. production/import for critical uses (71 FR 38339). EPA is not implementing any of these options

in this Final Rule.

With regard to the commenter’s concern regarding ca rryover of newly produced amounts, all carry-over methyl bromide that was produced or impo rted under the critical use exemption in 2005 was reported to EPA in 2006 and the total allo wable level of new production/import in 2007 has been reduced accordingly. This is an effe ctive means of minimizing production of new ODS while ensuring the availability of methyl bromi de for critical uses.

6.b. Proposed Strategic Inventory

Commenter Organization Document ID Number Betsy Peterson CA Bean Shippers Association 0113

Steve Godbehere None 0117 Stephen Payne Pet Food Institute 0118

Nancy Sandrof Methyl Bromide Industry Panel of the American Chemistry Council 0120, 0120.1

Mark Reddick Reddick Fumigants, Inc. 0121, 0121.1 Richard Matoian CA Fig Advisory Board 0124

Michal Mellano CA Cut Flower Commission 0125 David McAllister Chemtura Corporation 0136 Amy Schaffer Weyerhaeuser Company 0142 William Murray American Forest & Paper Association 0149

• Six commenters agree with EPA’s suggested one-year stockpile standard as a minimum. [0117, 0118, 0120.1, 0121, 0124, 0136]-36-

− Two of these commenters state that a strategic rese rve large enough to supply at least 12 months of U.S. demand amounts to 8,800,000 kilogram s or 19.4 million pounds, based on 2005 usage, which constitutes 34% of the 1991 ba seline. [0120.1, 0136]

− Three commenters state that the one-year stockpile should be a minimum standard
because the time frame is based on the standard use d in the “essential use program” for CFCs and unlike alternatives to other ozone depleti ng substances, alternatives to methyl bromide are not universally effective in all geogra phic locations, even on the same crop, because of the large number of variables involved. The commenters also state that unexpected, sudden emergencies may also be more dif ficult to predict for methyl bromide due to the range and unpredictability of po tential causative conditions. [0118, 0121, 0136]

• Five commenters favor a one-year strategic inventor y, and propose that EPA should define one-year inventory as the amount requested in the 2 005 CUN (i.e., 39% of the 1991 baseline or 24.2 million pounds). The commenters argue that this amount of inventory provides a reasonable margin necessary to address unexpected c ircumstances [0113, 0117, 0118, 0121, 0124]

• Two commenters suggest a 24 month inventory to main tain non-disruptive management. [0142, 0149]

• One commenter supports the concept of applying a “s trategic-reserve” approach to the critical use exemption program in order to mitigate a potential failure at the single methyl bromide production facility in the U.S. and to supp ort unforeseen demand increases, but requests more information on how EPA would implemen t it in order to provide detailed comments. [0120.1]

• One commenter believes that the strategic reserve o f methyl bromide should be preserved at the current levels. [0125]

Response: As the preamble to the Final Rule states, EPA has n ot reached any conclusion regarding what amount of methyl bromide would be ap propriate to maintain as a strategic inventory. The Agency intends to continue explorin g the issue in future rulemakings, particularly in the context of the 2008 critical us e exemption.

• While commending EPA for thinking strategically abo ut the risks of inadequate CUE allocations, three commenters are of the opinion th at establishing an emergency access procedure is the wrong solution since there is no e ffective mechanism in the Protocol to provide for emergency uses due to a natural disaste r. The commenters state that the EPA should instead allocate production allowances for t he full CUE approved by the Parties in Decision XVII/9. [0118, 0121, 0136]

Response: In the preamble to the Final Rule EPA discussed opt ions that it could take in the event of a severe inventory shortage. An emergency use exemption is contemplated in Decision-37-

IX/7 to the Montreal Protocol, but EPA has not issu ed regulations implementing such an exemption.

For reasons discussed in the preamble to the Final Rule and above in this document, EPA is allocating 4,316,055 kilograms of critical use meth yl bromide for new production and import in 2007, with 1,914,600 kilograms of critical use meth yl bromide from existing inventory.

6.c. Accounting for Inventory and Disclosure of In ventory Information

Commenter Organization Document ID Number David Doniger Natural Resources Defense Council 012 2, 0122.1

• One commenter states that EPA has failed to account for inventory, as it is required to do under the Montreal Protocol. Specifically, the com menter states that EPA will not disclose and account for the pre-2005 stockpile. The commen ter states that the proposed rule does not comply with the requirements of Decisions KVII/9, ¶ 5 to comply with Decision IX/6 and to account for inventory. Additionally, the commenter asserts that “EPA has undertaken no assessment of how much of the purported critical ne ed could be met with inventory,” though “Decision IX/6 ¶1(b)(ii) permits new production and consumption of methyl bromide only if it is not available in sufficient quantity and qual ity from existing inventory of banked or recycled methyl bromide.” This commenter believes that inventory increased in 2003 and that much of this amount remains. [0122]

Response: After publication of the NPRM (71 FR 38325) in July 2006, EPA released information on the pre-phaseout aggregate inventory at the end of 2003, 2004 and 2005, which is

available on the docket for this action. EPA has a ddressed the issues the commenter raises in the preamble to the Final Rule.

• One commenter is concerned that some of the existin g 29 inventory holders may be attempting to evade EPA’s reporting procedures for inventory by “transferring the legal title to previously reported inventory to other entities, presumably entities that will ultimately use those inventories.” The commenter suggests that EP A could broaden its Section 114 information gathering to ensure that it accounts fo r all inventories subject to Decision IX/6, thereby avoiding any “subterfuge of shifting owners hip.” [0122]

Response: EPA receives comprehensive annual data reports on i nventories of methyl bromide from over 30 companies that produce, import, distri bute or apply methyl bromide. Pursuant to reporting requirements at 40 CFR 82.13, producers, importers, distributors, and applicators are required to report the amount of inventory that the y own, as well as the amount that they hold on behalf of another entity. EPA is not aware of circ umstances in which a presumed end-user has sold its inventory of methyl bromide. Therefore, t he Agency believes it is aware of virtually all existing inventories, and would be interested in an y substantive information the commenter possesses suggesting that this is not the case.-38-



### 7. Summary of Comments Relating to RULEMAKING AND THE

REGULATORY PROCESS

Commenter Organization Document ID Number Betsy Peterson CA Bean Shippers Association 0113 None Albemarle Corporation 0116, 0116.1

Steve Godbehere None 0117 Stephen Payne Pet Food Institute 0118 Pamela Peckman The Industrial Fumigant Company 0119 Nancy Sandrof American Chemistry Council 0120, 0120 .1 Mark Reddick Reddick Fumigants, Inc. 0121, 0121.1 David Doniger Natural Resources Defense Council 012 2, 0122.1 Richard Matoian CA Fig Advisory Board 0124

Michal Mellano CA Cut Flower Commission 0125 Marcy Martin CA Grape & Tree Fruit League 0126 Bruce Houtman Dow AgroSciences LLC 0132, 0132.1, 01 32.2 David McAllister Chemtura Corporation 0136

Edward Ruckert McDermott, Will & Emery for the Crop

Protection Coalition 0139

Steve Hensley USA Rice Federation 0141, 0141.1, 0141.2, 0141.3, 0141.4, 0141.5, 0141.6, 0141.7,

0141.8 Amy Schaffer Weyerhaeuser Company 0142 George Lowerts International Paper 0145 William Murray American Forest & Paper Association 0149 Gene Harrington NPMA 0150

• Fourteen commenters object to EPA’s decision to red uce the total level of new production and import for critical uses by 443,000 kilograms t o reflect the total level of carry-over material available at the end of 2005. They contend that the 2005 carry-over quantity was primarily attributable to EPA’s promulgating the su pplemental CUEs in December, 2005 which did not allow enough time to use the issued c ritical use methyl bromide before the end of the year. They state it is unfair to penalize st akeholders for EPA’s inability to promulgate regulations in a timely manner. [0113, 0116.1, 0118 , 0119, 0120.1, 0121, 0124, 0125, 0126, 0136, 0139, 0141, 0149, 0150]

Response: EPA has addressed these comments in Section V.C. of the preamble to the Final

Rule.

− Two of these commenters also state that the delay i n finalizing the CUEs for 2006 forced distributors to carry over some critical use methyl bromide from 2005 to meet early orders. [0120.1, 0116.1]

Response: EPA has addressed these comments in Section V.C. of the preamble to the Final

Rule.

− Additionally, one commenter believes that since 200 5 was the first year of implementation of the CUE program, systems of order ing, distributing and selling critical use methyl bromide were not up and running from Jan uary 1, the date the framework rule

took effect. The commenter states that since the Fi nal Rule was not published until-39-

December 23, 2004, producers, importers, and distri butors of methyl bromide did not have sufficient time to implement the details of th e rule before the calendar year started. The commenter thus urges the EPA to suspend the car ry-over reduction for this first year. [0120.1]

Response: EPA has addressed these comments in Section V.C. of the preamble to the Final

Rule.

- This commenter further contends that this unfairly penalizes producers, importers

and distributors of methyl bromide who had no carry -over inventory in 2005 since the reduction applies to all allocations in 2005. The commenter states that those entities that had a carry-over inventory in 2005 ar e “rewarded” since they not only have the carry-over amount but also have a portion of the 2007 allocation. The commenter recommends that the EPA should apply a re duction on a companyspecific basis – i.e. the reduction should be equal to the reported carry-over by the company – rather than on 1991 baseline market share s. [0120.1]

Response: EPA proposed and finalized an across-the board appr oach for deducting carry-over amounts in the Framework Rule, stating that “EPA is creating a system for deducting the amount of unused methyl bromide from the total number of a llowances” (69 FR 76997). Based on comments and other feedback the Agency has received , EPA does not anticipate a significant amount of carry-over of methyl bromide in future ye ars. Therefore, EPA is not planning to revisit the across-the-board approach at this time.

− One commenter states that the delayed 2005 suppleme ntal allocations not only granted requests for additional amounts of methyl bromide, but also added six critical uses that had been authorized by the Parties at their 16 th meeting in November 2004. These uses were allocated no critical use methyl bromide for 2 005 prior to December. [0136]

Response: The Agency is making a strong effort to finalize al location rules earlier in each calendar year to avoid the type of complications th at the commenter describes.

− Two commenters state that there are many reasons wh y methyl bromide may not be used in a given year that do not entail a reduction of a llocation in following years. These situations include lower than expected pathogen loa ds, crop production changes, and other short term decisions. [0142, 0149]

Response: As discussed in the preamble to the Final Rule, E PA is deducting the amount of unused methyl bromide from the total number of allo wances for new production and import issued for the control period following the control period immediately after the control period when the methyl bromide was unused for critical use s. This approach does not reduce the amount of total methyl bromide available to critica l users based on lower than anticipated methyl bromide use in previous years. Following a year wh en methyl bromide use was less than anticipated, the amount of methyl bromide available to critical users is still determined by the critical use allocation process and not the amount of unused methyl bromide in previous years.-40-

Unused methyl bromide only affects the proportion o f critical use methyl bromide from new production and import versus post-phaseout inventor y.

• Five commenters state that it is inappropriate for the EPA to revisit the technical analysis contained in the 2007 CUN at this late stage in the allocation process. They state that revisiting the 2007 CUN analysis ignores the fact t hat the Parties have already authorized the quantity of methyl bromide for 2007 and new develop ments from the time when the critical use community prepared its application season have already been incorporated into the Partyapproved numbers. [0113, 0117, 0118, 0121, 0136]

Response: EPA does not agree that new developments have in a ll cases been incorporated into the numbers approved by the Meeting of the Parties. For example, in the NPRM EPA sought information regarding changes to the registration o r use of alternatives that may have transpired after the 2007 U.S. nomination was completed. Such information has the potential to alter the technical or economic feasibility of an alternative and could thus prompt EPA to modify its analysis of which uses and what amounts of methyl b romide qualify for the critical use exemption. EPA strives to use the best available i nformation in its analyses and rulemakings.

• Four commenters suggest that the EPA should move to a three-year CUE cycle instead of the
current annual one to reduce the administrative bur den and improve timeliness in the allocation process. [0113, 0117, 0125, 0145]

Response: The United States Government has argued for multipl e-year exemptions, but to date other Parties to the Montreal Protocol have not agr eed to this approach. As a result, critical use exemptions are currently nominated, authorized and allocated on an annual basis.

• One commenter expresses concern that the CUE proces s has become time and resource intensive for stakeholders, especially for small us ers. [0113]

Response: EPA remains sympathetic to the commenter’s concerns about the time and resource burden on small CUE applicants. For similar reason s, EPA allowed recipients of very small amounts of critical stock allowances, on a voluntar y basis, to permanently relinquish their allowances. While EPA did not receive any comments or responses to this portion of the NPRM, EPA may consider re-proposing this option in future rulemakings. EPA will continue to strive to balance the need for thorough CUE applications, wit h concerns about time and resource burdens. However, as stated in the Final Rule, EPA is not re vising the 2007 CUE analysis at this time.

• Two commenters state that the downward adjustment o f the amount of critical use methyl bromide in 2007 attributable to new production or i mportation was made by EPA and USDA without the full involvement of each affected appli cant. [0126, 0139]

Response: In the NPRM, EPA proposed to allocate critical st ock allowances (CSAs) for 2007 in an amount equal to either 6.2% or 7.5% of the 19 91 baseline (25,528,000 kilograms) and sought comment on this proposal. In the Final Rule , the Agency is allocating CSAs equal to 7.5% of baseline (1,914,600 kilograms). Section V. G. of the preamble to the Final Rule

describes the reasons for this action. EPA conside red all of the comments relevant to this-41-

decision. As discussed in the preamble to the Fina l Rule and in this document, the comments EPA received regarding the amount of methyl bromide from new production and import were diverse in their opinions. For example, some comme nters wanted all critical use methyl bromide to come from inventory with no new production and i mport, while other commenters would like substantially more new production and import than E PA is allocating. As discussed in the Final Rule, EPA’s decision was made in light of the comme nts received as well as EPA’s obligations

and commitments under the Clean Air Act and the Mon treal Protocol.

• One commenter believes that EPA violates Decision I X/6 on multiple fronts:

− The commenter states that by arguing that it is bou nd to only paragraph 1 of Decision IX/6 and is free to ignore the conditions imposed i n subsequent paragraphs of the same Decisions, EPA has exhibited a partial “pick and ch oose” compliance. Referencing Clean Air Act section 604(d)(6), the commenter cont ends that EPA does not have the discretion to refashion the Parties’ Decisions by d isregarding the later paragraphs and the conditions they impose.

Response: EPA has addressed these and similar comments in the Preamble of the Final Rule, the Response to Comment Documents for the Framework Rul e and the 2006 CUE Rule, and in previous Federal Register notices. EPA is not disr egarding any Decision language: the commenter simply disagrees with EPA’s interpretatio n of certain language.

− In relation to the initial 2005 CUE Rulemaking, one commenter contends that in spite of a clear obligation to abide by Decision IX/6’s cond itions, EPA issued the original 2005 exemptions in December 2004 without any assessment of compliance with the Decision IX/6 criteria as set forth in paragraph 5 of Decisi on Ex. I/3. Specifically, the commenter argues, EPA failed to comply with the following req uirements:

-to disclose and account for methyl bromide invento ry, -to prevent non-critical users from using such inve ntory and to prevent critical users from “double-dipping” – using both inventory and ne w production in amounts that exceed their approved critical use needs, -to reduce new production and consumption to only t he minimum amount needed to service critical uses after accounting for inventor y, and

-to restrict critical uses to the minimum amount th at reflects the use of all technologically and economically feasible alternati ves.

Additionally, this commenter contends that in relat ion to the supplemental 2005 CUE Rulemaking, by proposing to authorize a further 611 metric tons of critical stock allowances for supplemental critical uses in 2005, the EPA fai led to comply with Decisions XVI/2 and

IX/6.

This commenter further objects to the proposed “adv ance” approval of supplemental critical uses. The commenter believes that domestic approva l should not be granted without full review and approval in a Decision of the Parties. The commenter believes that any such decision is likely to require subsequent second rev iews to assure compliance with Decision IX/6 conditions and allow the public to comment on EPA’s proposed result. [0122]-42-

Response: EPA has addressed the commenter’s arguments in the Preamble to the Final Rule. The Response to Comment Documents for the Framework Rule and the 2006 CUE Rule, available on the docket for that rule (EPA-HQ-OAR-2 003-0230) and in previous Federal Register notices. .

• Two commenters believe that EPA should publish a pr oposed allocation rule based on the amount of methyl bromide contained in the U.S. nomi nation to the Parties rather than after the Parties have finalized the CUE amount to be gra nted to the U.S. The commenters believe that this would allow the public to comment earlier on in the process and allow EPA to issue a Final Rule allocation in a more timely manner. [0 139, 0141]

Response: EPA appreciates the commenter’s suggestion and will continue to consider a variety of approaches to issuing final CUE allocation rules in a timely manner.

• One commenter recommends that EPA:

- Utilize all available information at the time of al location to minimize the continued U.S. reliance on methyl bromide. This sh ould also include updates to conclusions based on old data since in many cases, estimates of yield losses are

based on old data.

- Recognize that in the three years that it usually t akes to complete the CUE process, there can be dramatic, dynamic changes in the status of methyl bromide and the potential alternatives. New technologies, p roduct registrations, conditions of “re-registration,” and the implementation of loc al, state, or federal restrictions on either methyl bromide or alternatives can have a profound effect on the capacity of alternatives to serve as a viable repla cement. The commenter thus encourages EPA to seek new information on a regular , ongoing basis.

Response: EPA strives to use the best available information i n its analyses. EPA sought comment on any information regarding changes to the registration or use of alternatives that may have transpired after the 2007 U.S. nomination was written. Such information has the potential to alter the technical or economic feasibility of a n alternative and could thus cause EPA to modify the analysis that underpins EPA’s determinat ion as to which uses and what amounts of methyl bromide qualify for the critical use exempti on. While EPA is not revising the technical analysis at this time due to the lack of new infor mation regarding the registration or use of alternatives, EPA will continue to consider such in formation in future rulemakings.

− Provide incentives to private industry to further d evelop and refine viable alternatives to methyl bromide and to consumers to utilize these al ternatives.

Response: EPA believes that the phase-out of methyl bromide, except for critical uses, provides incentives for private industry to utilize alternat ives. In addition, the United States Government continues to support research and adoption of alter natives.

− Utilize information presently available to EPA to r equire that all existing inventory of methyl bromide and the amounts left over from the 2 005 CUE process are utilized prior-43-

to authorizing the production of new volumes. In t his context, the commenter cites the Section 114 “data call-in” [information request] is sued by EPA. [0132.1]

Response: EPA has addressed this and similar comments regardi ng use of all existing inventory prior to authorization of new production in the res ponse to comment documents for the Framework and 2006 CUE rules, in prior Federal Regi ster notices, and in the Preamble of the Final Rule. EPA is deducting 2005 carryover amount s in the 2007 allocation.

• One commenter requests that EPA be more transparent in its calculation processes. The commenter states last year’s miscalculation of crit ical use allowances for post-harvest uses by 20% as a basis for the request. [0150]

Response: Consistent with previous years, EPA has made its calculations available on the docket in a spreadsheet entitled Allowance Allocati ons Docket Final ( EPA-HQ-OAR-2005-

0538-0054 ).