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###### Department of Agriculture

###### Grain Inspection, Packers and Stockyards Administration 

# AGENCY:

Grain Inspection, Packers and Stockyards Administration, USDA. 

# ACTION:

Final notice.

      ( print page 66229)    

# SUMMARY:

The Grain Inspection, Packers and Stockyards Administration (GIPSA) will begin certifying wheat protein content results on any specified moisture basis requested by applicants, in addition to certifying results on the current 12.0 percent moisture basis. This change was requested by importers of U.S. wheat. 

# EFFECTIVE DATES:

May 1, 2001. 

# FOR FURTHER INFORMATION CONTACT:

                        Paul Manol at GIPSA, USDA, STOP 3632, 1400 Independence Avenue, SW., Washington, DC, 20250-3632; FAX (202) 720-1015; or E-mail                         *Pmanol@Gipsadc.usda.gov.*

# SUPPLEMENTARY INFORMATION:

On May 1, 1978, GIPSA (then the Federal Grain Inspection Service or FGIS) began offering official wheat protein testing for Hard Red Winter and Hard Red Spring wheat to interested parties in the grain industry. An “as-is” moisture basis was used to calculate protein content, though it could also be determined and recorded using any specified moisture basis if requested by the applicant for inspection. GIPSA received numerous complaints, mostly from foreign buyers, about calculating protein content on an as-is moisture basis. These complaints were generally about low protein levels which, in part, appeared due to the difference between the U.S. and Canadian methods for computing and stating protein content. Canada was using a fixed 13.5 percent moisture basis; the U.S. an as-is moisture basis calculation. When using an as-is moisture basis to certify protein, the certified protein result depends directly on the moisture level of the wheat—it is inversely proportional to the moisture content. Consequently, as the moisture content of the wheat gets lower, the protein content reported on an as-is basis gets higher. This phenomenon can give the perception that the protein level increased when, in fact, it remained unchanged. 

                    To address these concerns and increase the uniformity of official protein reporting procedures, FGIS proposed, in 1986, to revise its Grain Inspection Handbook to certify protein content on a constant 12.0 percent moisture basis. A 12.0 percent moisture basis was recommended by various grower and processor organizations, as well as the Grain Quality Workshops, because this percentage represented the average moisture content of wheat exported from the United States. Certifying protein content on a constant 12.0 percent moisture basis would provide buyers and sellers of U.S. wheat results that could be easily evaluated and compared with results from other major wheat exporting countries. For example, Canada uses a 13.5 percent moisture basis, Australia uses either 11.0 percent or “as-is”, England and Sweden use 15.0 percent, and many Eastern European and other countries around the world use the dry matter basis. This proposal, announced in the May 30, 1986,                     **Federal Register**                     (51 FR 19556), solicited industry comment on this action.                 

                    Comments on the May 30, 1986, proposal generally favored a constant moisture basis for protein determination. Some commentors suggested using either a dry matter (0.0 percent moisture basis) or a 14.0 percent moisture basis as the constant. European flour mill purchase specifications typically use a dry matter reporting basis, whereas American mills rely on a 14.0 percent moisture basis. The majority of commentors, including foreign buyers, supported the proposal to certificate protein on a constant 12.0 percent moisture basis. Consequently, FGIS announced this change in the August 26, 1986,                     **Federal Register**                     (51 FR 30323) to become effective May 1, 1987.                 

Moving to a constant 12.0 percent moisture basis eliminated varying protein results caused by fluctuating wheat moisture levels. To date, GIPSA only certifies protein results on a 12.0 percent moisture basis. 

The current 12.0 percent moisture basis requirement for protein analysis in wheat may not be fully facilitating the marketing of export wheat. A number of U.S. wheat importers have asked GIPSA to provide optional certification of wheat protein content results on any specified moisture basis requested by applicants, in addition to the current 12.0 percent moisture basis. 

                    To address these requests, GIPSA published a Notice in the October 1, 1998,                     **Federal Register**                     (63 FR 52681) that solicited comments on introducing flexible certification in our protein testing program, in addition to maintaining the standardization of results. Allowing certification on the 12.0 percent moisture basis and, optionally, on a moisture basis requested by the applicant would provide sufficient information on the inspection certificate to facilitate the marketing of wheat. Although this certification option was developed to address the export market's need, it could be used for domestic shipments as well. This would be especially true in situations when an exporter is originating wheat to fulfill an export contract that requires a moisture basis other than 12.0 percent. Therefore, this certification option would be available from GIPSA field offices, delegated States, and designated agencies. Adopting this action would allow GIPSA and the grain industry the greatest flexibility in the certification of wheat protein. Protein results would continue to be certified on a constant 12.0 percent moisture basis on all certificates, but GIPSA also would have the flexibility to meet customers' requests for additional information.                 

## Discussion of Comments Received 

A total of 22 comments were received from several foreign wheat millers and governments (Jordan, Syria, India, and Poland); State Wheat Boards/Commissions (California, Idaho, Nebraska, and Oregon); a State Department of Agriculture (Wisconsin); U.S. Wheat Associates; and U.S. grain industry trade groups (National Grain & Feed Association (NGFA) and North American Export Grain Association (NAEGA)). One domestic miller also commented on the proposal. 

Thirteen comments favored the notice as it was written; that is, to allow for protein certification on any moisture basis requested by an applicant as well as the current 12.0 percent moisture basis. These comments were from the State Wheat Boards/Commissions, the State Department of Agriculture, U.S. Wheat Associates, and several foreign entities. 

Two comments (NGFA and NAEGA) opposed the proposal as written. They suggested that reporting protein results on 12 percent and alternative moisture bases would likely create documentation problems for processing letters of credit. They suggested using one basis or the other, but not both. 

The remaining seven comments, from foreign entities, suggested reporting results on any moisture basis requested; a 12 percent basis; an “as-is” basis; or a dry matter basis. One commentor suggested certifying the testing methodology. 

Producer groups tend to favor certifying protein content on a 12-percent and any requested moisture basis. Their rationale is that dual certification would alleviate any “misperception” that a grain handler could purchase grain on a 12-percent basis and subsequently re-market the same lot of grain using a lower moisture basis, thereby “increasing” the protein content. This was one of the concerns about GIPSA's original policy that certified protein content on an “as-is” basis. 

                    Other comments in support of the change concurred that it would add flexibility to the U.S. wheat marketing system and allow the U.S. industry to                           ( print page 66230)                        better meet its customers needs. The change would allow buyers to better compare U.S. wheat to that of other wheat exporting countries and reflect the U.S. wheat industry's commitment to meet customers' needs. Further, it was suggested that the change would allow the national protein certification system to retain its uniformity and meet customers' specific contract needs.                 

GIPSA believes that introducing flexible certification in the protein testing program, in addition to maintaining standardization of results, will have a positive impact on export and domestic markets. We do not believe that this change would create documentation problems for processing letters of credit as two commentors suggested. On the contrary, providing for this option in the certification program will give the market the flexibility that it needs. Further, alternative protein reporting would be only used on a request basis. The effective date of this change is May 1, 2001. This will allow sufficient time for interested persons to become familiar with this option and allow the industry to make any adjustments deemed necessary. 

Protein analysis and certification by GIPSA has always been optional; that is, buyers and sellers contractually agree whether or not to request official protein testing services. Wheat protein content would be certified on an alternative moisture basis only upon specific request by an applicant. In lieu of such a request, wheat protein would continue to be certified on the current 12.0-percent moisture basis. Overall, this certification option would allow GIPSA and the grain industry the greatest flexibility in the certification of wheat protein. 

Accordingly, GIPSA will begin certifying protein content in wheat using the current 12.0 percent moisture basis and any other moisture basis requested by an applicant. This certification option will go into effect May 1, 2001. GIPSA field offices, delegated States, and designated agencies will be responsible for the applicable mathematical calculations for certification using the following industry recognized formula: 

Where: 

X = the protein content at a moisture basis other than 12.0 percent requested by an applicant. 

P = the protein content determined at a 12.0-percent moisture basis. 

PX = the moisture basis specified by the applicant (using the “official” moisture meter results if the applicant requests protein content be certified on an “as-is” basis). 

For example, if an applicant requests that protein results also be certified on a dry matter or 0.0 percent moisture basis and the protein content of the lot was determined to be 13.5 percent on a 12.0 percent moisture basis, the following calculation would be used to obtain the alternate protein result: 

Further, the statement on the certificate would read as follows: 

Protein 15.3%, dry matter basis, which converts to 13.5% protein, 12.0% moisture basis. Protein content reported on an alternative moisture basis in addition to the U.S. standard 12.0 percent moisture basis at applicant's request.

Authority:                        Pub. L. 94-582, 90 Stat. 2867, as amended (7 U.S.C. 71*et seq.*)                     

Dated: October 30, 2000. 

David Orr,

Acting Administrator, Grain Inspection, Packers and Stockyards Administration. 

[FR Doc. 00-28146 Filed 11-2-00; 8:45 am] 

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