NOMINATING PARTY: The United States of America

FILE NAME: USA CUN12 SOIL STRAWBERRY FRUIT Open Field

BRIEF DESCRIPTIVE TITLE OF NOMINATION: Methyl Bromide Critical Use Nomination for Preplant Soil Use for Strawberry Fruit Grown in Open Fields (Submitted in 2010 for the 2012 Use Season)

CROP NAME (OPEN FIELD OR PROTECTED): Strawberry Fruit Open Field

QUANTITY OF METHYL BROMIDE NOMINATED:

T ABLE 1: Q UANTITY OF M ETHYL N OMINATED

Year N OMINATION A MOUNT

2012 756,515 kg

NOMINATING PARTY CONTACT DETAILS:

Contact Person: John Thompson

Title: Division Director

Address: Office of Environmental Policy U.S. Department of State 2201 C Street, N.W. Room 2658 Washington, D.C. 20520

U.S.A. Telephone: (202) 647-9799 Fax: (202) 647-5947

E-mail: thompsonje2@state.gov

Following the requirements of Decision IX/6 paragraph (a)(1) The United States of America has determined that the specific use detailed in this Critical Use Nomination is critic al because the lack of availability of methyl bromide for
this use would result in a significant market disruption

. . ■ Yes  No

Signature Name Date

Title:

(Details on this page are requested under Decision Ex. I/ 4(7), for posting on the Ozone Secretariat website under Decision Ex. I/4(8).)

This form is to be used by holders of single-year exemptions to reapply for a subsequent year’s exemption (for example, a Party holding a single-year exem ption for 2005 and/or 2 006 seeking further exemptions for 2007). It does not replace the format for requesting a critical-use exemption for the first time.

In assessing nominations submitted in this format, TEAP and MBTOC will also refer to the original nomination on which the Party’s first-year exemption was approved, as well as any supplementary information provided by the Party in relation to that original nomination. As this earlier information is retained by MBTOC, a Party need not re-submit that earlier information.

USA CUN12 SOIL Strawberry Fruit Open Field Page 1 of 17CONTACT OR EXPERT(S) FOR FURTHER TECHNICAL DETAILS:

C ontact/Expert Person: Jack Housenger

Title: Director

Address: Biological and Economic Analysis Division Office of Pesticide Programs U.S. Environmental Protection Agency 1200 Pennsylvania Avenue, N.W. Mailcode 7503P Washington, D.C. 20460

U.S.A. Telephone: (703) 308-8200 Fax: (703) 308-7042

E-mail: Housenger.Jack@epa.gov

LIST OF DOCUMENTS SENT TO THE OZONE SECRETARIAT IN OFFICIAL NOMINATION PACKAGE:

1. PAPER DOCUMENTS: Title of paper documents and appendices No. of pages Date sent to Ozone

Secretariat

USA CUN12 SOIL STRAWBERRY FRUIT Open Field

2. ELECTRONIC COPIES OF ALL PAPER DOCUMENTS: *Title of each electronic file (for naming convention see notes above) No. of kilobytes Date sent to Ozone

Secretariat

USA CUN12 SOIL STRAWBERRY FRUIT Open Field

* Identical to paper documents

USA CUN12 SOIL Strawberry Fruit Open Field Page 2 of 17

### METHYL BROMIDE CRITICAL USE RENOMINATION FOR PREPLANT SOIL USE (OPEN FIELD OR PROTECTED ENVIRONMENT)

STRAWBERRY FRUIT

1. SUMMARY OF THE NEED FOR METHYL BROMIDE AS A CRITICAL USE

This nomination is for methyl bromide for the pr oduction of strawberries in California, Florida,

and several other states in the southeastern U.S. (Alabama, Arkansas, Georgia, Illinois, Kentucky, Louisiana, Maryland, Miss issippi, Missouri, New Jersey, North Carolina, Ohio, South Carolina, Tennessee, and Virginia). Strawberry growers have been re placing methyl bromide and reducing its us e rates in all production areas.

The USG has reviewed all factor s affecting transition rates in this sector. Based on this assessment the transition rate has been greatly incr eased for most portions of this sector. For the area covered in this nomination, the USG believes that the narrative discussion included in this document is technically valid. The USG has nomi nated amounts of methyl bromide based only on those sub-sectors that cannot transition away from methyl bromide at the accelerated rate.

California . California growers have a cr itical need for methyl brom ide, for 2011, to treat fields where alternatives are not available due to regula tions or to complete a fumigation program that includes a once per three year tr eatment with methyl bromide to manage two new diseases. Iodomethane is unlikely to be registered for use in California in the near future and, therefore, cannot reduce methyl bromide critical needs. Although use of methyl bromide has been reduced over the years (approximately one-third of strawb erry land was treated with methyl bromide in 2006 (NASS, 2007; Table 1) this tre nd is in danger of being slowed if the incidences of two new diseases continue to increase in strawberry fields. Macrophomina and Fusarium oxysporum have emerged in some fields that have been tr eated annually with altern atives (Legard, personal communication, 2008). These pathogens have not been found in any of the fields that have been treated annually with methyl bromid e (Legard, personal communication, 2008).

The lowest formulation of methyl bromide that is likely to be allowe d in California is 57:43 (methyl bromide:chloropicrin) due to severe restri ctions on the use of chlo ropicrin. High rates of chloropicrin (greater than 225 kg/ha) are restri cted by regulation and lower rates may not be optimally effective against plant pathogens. Township caps restricting the use of 1,3-D may affect between 5,700 and 9,000 hectares by 2011 (California Strawberry Commission, 2008— Appendix JJ.11).

Florida . Iodomethane is now registered in Florida. Fumigant trials indicate comparable results to methyl bromide. A transition from methyl bromide to iodomethane should occur quickly if first-users of iodomethane report successes in the 2008 and 2009 seasons. However, use rates, formulation and differences in application t echniques require development of protocols for effective use of the new product.

USA CUN12 SOIL Strawberry Fruit Open Field Page 3 of 17Some production areas in Florida ar e located above karst geological formations. For these areas, there are restrictions on the use of 1,3-D to prev ent contamination of ground water. Fields with key disease problems have achieved good control with chloropicrin, butthose with sting nematode problems require either methyl bromide or 1,3-D. Results of several years of research trials in Florida with low permeable films indicate that an effective rate of methyl bromide with these films may be as much as 50% less than the historical use rate for some Florida strawberry production land (Noling and Botts, 2007a; Noling and Botts, 2007b). Rates that are 25-50% lower than historical methyl bromide rates are bei ng used in Florida as the use of VIF-type films

has increased. This has allowed a reduced rate of methyl bromid e while maintaining efficacy.

Eastern Region . Growers in 15 states have reduced thei r use of methyl bromide from previous years. Continuing research and extension tria ls (e.g., Welker et al., 2008; Poling and Schiavone, 2008) suggest that growers will transition to alte rnatives as rates and application methodologies are optimized. For 2012, this consortium reque sted on average a rate of 70 kg methyl bromide/ha to be used with a 50:50 (methyl bromide: chloropicrin) formulation. Diverse climatic areas even within a single state (e .g., coastal, mountain, piedmont) prevent a uniform description of an “eastern strawberry producti on” region. This strawberry industry is decentralized and outside of North Carolina consists of small family farms that directly market strawberries through “U-pick”, “r eady-pick”, roadside stands, and farmers markets (Sydorovych et al., 2006). In the eastern U. S, many of the farms contend with yellow and purple nutsedges, which are significant problems in some areas more than others. Farmers with a low incidence of nutsedge use other chemicals, such as chloro picrin, 1,3-D, and metam-sodium to manage diseases such as black root rot, nematode s, and other weeds (Sydorovych et al., 2006). Iodomethane will likely have increased use as growers gain experience with its application.

2. SUMMARIZE WHY KEY ALTER NATIVES ARE NOT FEASIBLE

Alternatives are considered not feasible where 1) they have not been sufficiently tested or protocols have not been sufficiently developed for their use, 2) co sts are excessive, 3) application difficulties exist due to such factors as hilly terrain or equipment requirements, 4) areas of environmental sensitivity or characteristics re duce their efficacy, 5) regulatory restrictions prevent their use, 6) pest pressure is to such an extent that al ternatives are not effective.

Approximately two-thirds of strawberry land in California use alternatives to methyl bromide (Table 2). In California, township caps curren tly restrict the use of 1,3-D on approximately 40- 62% of total strawberry land (California Strawberry Commission, 2008). High rates of chloropicrin (greater than 225 kg/ha) are rest ricted by regulation and lower rates are not optimally effective against plant pathogens. One alternative, iodomethane, is not registered for

use in California.

In Florida, based on the 2010 nomination, approximat ely one-third of strawb erry production land has been considered critical for methyl bromid e (Table 1). In eastern U.S. production areas, based on the 2010 nomination, approximately 18% of strawberry produ ction land has been considered critical for methyl bromide (Table 1). Iodomethane has recently been registered in all of the strawberry production states, except Califo rnia. Its use will likely replace a significant

USA CUN12 SOIL Strawberry Fruit Open Field Page 4 of 17portion of the critical use area for methyl bromide. However, because its registration is new it is not known how rapidly a transition to iodomet hane will take place by commercial operations (Toth, 2008). High-percent iodomethane formulations (98:2) have not been tested rigorously to support research findings. Identifying effective use rates and effective formulation ratios are only beginning to be addressed after the 2008 registration. Equipment adaptation and product availability are concerns for gr owers who have no experience with the product. Consequently, while iodomethane may be a promising soil treatmen t, there remains a critical need for methyl

bromide until issues of concern are sa tisfactorily resolved for iodomethane.

As previously stated, some production areas in Florida are located a bove karst geological

formations and there are restric tions on the use of 1,3-D. Sting nematode problems require either methyl bromide or 1,3-D. Some fields with key disease problems have achieved good control with chloropicrin, although there may be regulatory restrictions on its use at high rates.

Alternative strategies for pest managment where weed pressure is strong include additional herbicides to provide acceptable weed manageme nt. However, this may require a 30-day period prior to planting (Noling and Bo tts, 2007a). Additional technical problems may be encountered, such as proper distribution of low rates of me thyl bromide, which relies on back pressure measured at the flow divider (Noling and Botts, 2007a; Gilreath et al., 2005c). Noling and Botts (2007a) pointed out that taller and narrower beds required signifi cantly more hand labor to lay VIF film due to slippage during the laying operation. Newer formul ations of VIF films may help adjust for this problem.

3. IS THE USE COVERED BY A CERTIFICATION STANDARD?

Methyl bromide is not used to meet a certific ation standard for strawberry fruit production.

4. PROPORTION OF CROP USING METHYL BROMIDE

T ABLE 2. P ROPORTION OF C ROP U SING M ETHYL B ROMIDE

R EGION WHERE METHYL

BROMIDE USE IS REQUESTED T OTAL CROP

AREA ( HA ) A REA NOMINATED

FOR METHYL

BROMIDE USE IN
2012 (H A ) P ROPORTION 1 OF TOTAL

CROP AREA TO BE TREATED

WITH METHYL BROMIDE (%)

California 14,500 2 4,856 33 Eastern U.S. (15 states) 2,600 3 474 18

Florida 3,000 2 1,022 34

1 Based on the amount of methyl bromide nominated for the 2012 use season for strawberry fruit production.

2 NASS, 2007. 2006-season data.

3 Based on estimates from various recent extension publica tions of states associated with the requesting consortium.

5. IF PART OF THE CROP AREA IS TREATED WITH METHYL BROMIDE,

INDICATE THE REASON WH Y METHYL BROMIDE IS NOT USED IN THE OTHER AREA, AND IDENTIFY WHAT ALTER NATIVE STRATEGIES ARE USED TO

CONTROL THE TARGET PATHOGENS AND WEEDS WITHOUT METHYL

BROMIDE THERE.

USA CUN12 SOIL Strawberry Fruit Open Field Page 5 of 17The USG has reviewed all factor s affecting transition rates in this sector. Based on this assessment the transition rate has been greatly incr eased for most portions of this sector. For the area covered in this nomination, the USG believes that the narrative discussion included in this document is technically valid. The USG has nomi nated amounts of methyl bromide based only on those sub-sectors that cannot transition away from methyl bromide at the accelerated rate.

Pest problems vary, and therefor e, no one strategy is appropriat e for the variety of pests and growing conditions in strawberry production. Alternatives are used on two-thirds of strawberry production land in California. For example, “Methyl bromide is often being used in rotation with alternative fumigants. Many growers w ill use alternative fumigants for 2-3 years then rotate back to methyl bromide to clean up emerging weed and disease problems. While, in some locations, local permit conditions may not allow th e use of methyl bromid e due to the proximity of sensitive sites such as schools or housing, thus alternative fumi gants such a s Inline are used. In these locations, growers may accept lower returns over time due to higher weeding costs and reduced yields or they will cease growing strawberri es in those fields if soil borne disease losses and weed density gets too high” (California Strawberry Commission, 2008).

Furthermore, in California, the choice of fumigant “is influenced by a number of factors including the regulatory situation for a partic ular ranch, their financial situation—can they afford methyl bromide, the type of crop they are producing (summer plan tings typically do not use methyl bromide because they have a short production season while growers in the northern district are more likely to use methyl br omide since they have a very long season), the prevalence of disease or weed problems, etc...” (Legard, personal communication, 2008).

In the Florida and the eastern U.S., an area-wid e research program (Welker et al., 2008; Welker et al., 2007) has highlighted succe sses with alternatives (e.g., InLine ® , chloropicrin) and reduced rates of methyl bromide (150 kg ai/ha). Based on the 2010 U.S. nomination for methyl bromide,

alternatives are used on two-thirds of strawb erry land in Florida and approximately 82% of strawberry land in the eastern U.S. (Table 2). Preliminary research conducted on a commercial

farm in North Carolina where black root rot a nd winter weeds were th e key pests (with low nutsedge pressure) indicated that in some situations the efficacy of alternative treatments with a low permeable film was similar to a treatment of 300 kg methyl brom ide/ha with a standard film. The nomination for 2011 is for areas where pest pr essure is moderate to high and alternatives have not been sufficiently adap ted to the areas of concern.

6. WOULD IT BE FEASIBLE TO EXPAND THE USE OF THESE METHODS TO

COVER AT LEAST PART OF THE CRO P THAT HAS REQUESTED USE OF

METHYL BROMIDE? WHAT CHANGES WOULD BE NECESSARY TO ENABLE

THIS?

In California, expansion of alternative methods to critical areas “does not appear to be likely due to the emergence of two new soil borne diseas e problems and the persistence of the yellow nutsedge weed problem. An alarming number of fields in Santa Maria, Oxnard and Orange County, that have not been fumigated with methyl bromide for more than two years, are

USA CUN12 SOIL Strawberry Fruit Open Field Page 6 of 17experiencing increasing losses to charcoal rot ( Macrophominia phaseolina) and Fusarium wilt ( F. oxysporum )” (California Strawberry Commission, 2008). In addition restrictions on the use of 1,3-D in California and Florida limit its expansion to other areas . Research with virtually and totally impermeable films in California suggest that iodomethane (not registered) and 1,3-D and metam potassium sequential treatments could prov ide effective pest management and acceptable yields (Othman et al., 2009). If use rates, form ulation, and availability issues are resolved iodomethane use could provide e ffective soil treatment for Florid a and eastern U.S. strawberry growing areas where it is registered.

Nevertheless, the California Strawberry Co mmission has funded Farming Without Fumigants Initiative whose goal is to develop strawberry fruit production methods that can avoid the complexities of highly regulated fumigants. Th is research includes collaboration with the University of California and USDA (see secti on “Summary of Recent Research” below).

In Florida, iodomethane may be used in 2008 fo r the first time and could be a replacement for methyl bromide if use this season proves to be a cceptable. A transition period is likely to be necessary to allow protocols for iodomethane to be developed for commercial production of

strawberries in Florida. The a doption of VIF over the past two years has increased the efficacy of fumigants such that lower use rates are effective.

In the eastern U.S. adoption of VIF-type films is also occurring and alternatives are being used. However, for some areas methyl bromide has al lowed production on marginal land or in the case of the many small farms, land that is not able to be rotated out of strawberries due to the

economic situation of the farmer. Iodomethane will likely present a feas ible alternative with excellent efficacy (SE Regional Strawberry Integr ated Management Guide, 2008), but as is the case in Florida, a transition period for adoption of iodomethane is necessary for production areas in the eastern U.S. to allow protocols for iodomethane to be developed for commercial strawberry production (Toth, 2008).

7. SUMMARY OF RECENT RESEARCH

California . According to Legard (personal communication, 2008) with regard to Macrophomina

and Fusarium oxysporum

, “...neither disease was a problem before growers started using alternative fumigants, although we have not seen these disease probl ems in fields that have been strip/bed fumigated with methyl bromide (thi s method is used about 20% of the time in Santa Maria). The key consideration may be the shift from broadcast fumigation to drip fumigation. We are conducting studies this fall to see if high rates of fumigants applie d through the drip tape

can control these diseases. We have seen Ma crophomina occur in fields that were drip fumigated with 100% Pic. However, growers ar e restricted from applying rates above 200 lbs/a, so we are testing higher rates to see if they are e fficacious. If so, we w ould then need to find a way to convince local regulators to allow drip applications at t hose rates. Another reason for the increase in disease problems on fields not treated with methyl bromide may be related to the fact that MB disperses better and has a longer half-life than Pic. Straight MB does have fungicidal properties. Broadcast applications of straight Pic are strict ly regulated and many

USA CUN12 SOIL Strawberry Fruit Open Field Page 7 of 17counties either prohibit them or restrict thei r rates (in Ventura County they will allow only 125 lbs/a) to levels that are not efficacious. ”

Additional work has been conduc ted to confirm the observations from recent years that outbreaks of both pathogens were associated with wilting, stunting, and dying plants in coastal and inland strawberry production areas (Koike et al., 2009). In an attempt to address the problem, some growers have returned to usi ng a methyl bromide treatment after two years

treatment with alternatives in order to “clean -up” the soil contaminated with both emerging pathogens and weeds. In addition, Koike et al. (2009) found cultivar differences in susceptibility to the two diseases. Norton (2008) reported that excellent weed and disease control have been achieved with drip-applied 1,3-D/chloropicrin(InLine) followed 5-8 days later by metamsodium. However, weed control was highly de pendent on optimal fumigant placement, which has not always been applied.

Research continues regarding st eam treatment of soils (Gilber t et al., 2009; Daugovish et al., 2009; Fennimore et al., 2009; Fennimore and Goodhue, 2009). Results suggest that some treatments with steam manage various weed populations comparably to methyl bromide soil treatments and yields after steam treatments are si milar to yields after methyl bromide. Field

demonstrations were used to demonstrate th e latest in experiments in fumigation and nonfumigation methods for strawber ry production (Fennimore et al., 2009). Treatments also included various low- or non-permeable tarps. Steam was the only non-chem ical fumigant that had comparable weed control compared to methyl bromide. Costs of steam treatments were discussed by Fennimore and Goodhue (2009) with regard to orchard replant and ornamental nursery beds. Yellow nutsedge was more successf ully managed with steam in fall treatments (Daugovish et al., 2009). Physi cal barriers (paper and plastic mulches) appeared to reduce populations of nutsedge. A combin ation of steam and physical barriers may be effective. Work is continuing on steam treatme nt for strawberry production.

Inovative methods of strawberry production conti nue with experiments to test the efficacy of soilless production (Gabriel et al ., 2009; Wang et al., 2009; Gerik et al., 2009). Small-scale plots

tested various substrates includi ng peat and peat with perlite or rice hulls, and coconut coir used with green mulch or skunk mulc h (Gabriel et al., 2009; Wang et al., 2009). Initial results indicated that most of the soilless treatments pr ovided greater yields than the field soil-grown strawberry plants and water use, while vari able, might be within acceptable parameters. Pathogen populations of Verticillium dahliae

, Phytophthora cactorum , and Colletotrichum spp. were apparently affected by various treatments, but results were inconclusive at the early stages of testing. There was no discussion of the cost s associated with this type of system for strawberry production or the overall feasibility of the system for California-scale production requirements.

Florida and the Eastern Region . Iodomethane may offer an eff ective alternative to methyl bromide, although 2008 was the first year that it was available for use commercially. Consequently, uncertainties must be resolved and necessitate a critical need for methyl bromide for a portion of strawberry land until a transition can be complete. According to the Florida request for the critical us e of methyl bromide, " Iodomethane has been trialed extensively in replicated small plot research across the crop needs and soil type s currently treated with methyl

USA CUN12 SOIL Strawberry Fruit Open Field Page 8 of 17bromide in Florida. We have b een working with Arysta LifeSc iences in evaluating various cropping and efficacy components of iodomethane. Midas received a registration in the state of Florida on July 7, 2008. We anticipate additional grower use and trial work this fall with further acreage of Florida strawberries, tomato es and peppers receiving treatment. A major impediment to adoption of this alternative is the extensive risk mitigation and management requirements associated with its use. Th e expense of the product and complexity of implementing these requirements have significantly reduced the enthusiam of growers for this

alternative ."

At a research station in North Ca rolina, various rates of iodometh ane were tested (Poling et al., 2009). MIDAS (iodomethane:chloropic rin) at 200 kg/ha of 50:50 w ith standard tarps and at 135 kg/ha with virtually impermeable film had th e highest marketable yields in the study and statistically similar to methyl bromide at 196 kg/ha with virtually impermeable film. The MIDAS rate of 135 kg/ha provided greater yields than higher rates of th e product under virtually impermeable film. Researchers concluded that “t he net benefit of using Midas 50:50 at 120 lb/A [135 kg/ha] with VIF could easily exceed $10,000 pe r acre in extra profits for the grower compared to no fumigation. This much economic benefit from fumigation would not likely be observed on sites where good crop rota tion is possible, but on sites where rotation is not possible, a serious crop reduction may occur for growers who do not fumigate.”

In Florida, trials were conducte d that assessed iodomethane (eith er drip- or chisel-applied). Iodomethane (and various 1,3-D/chloropicrin treatmen ts) resulted in yields that were comparable to methyl bromide treated plots (Noling, 2008). However, variability between test sites were said to be a result of application problems. Th ese will have to be resolved prior to optimal

commercial use of thes e alternatives.

In the southeast area-wide USDA-funded trials, researchers reported (Welker et al., 2009) “we have had great success with the alternatives and yield data ha s shown comparable yields to methyl bromide fumigation from at least one alternative.” However, the trials showed that “alternatives are not nearly as forgiving as methyl bromide under less than ideal environmental

conditions.”

Iodomethane is also registered in the easte rn strawberry-growing st ates comprising this

consortium. North Carolina Stat e University extension rated i odomethane:chloropicrin (50:50) as providing excellent control of diseases nematodes and good to excellent control of weeds, including nutsedge (Welker, 2008). A formulati on of 98:2 (iodomethane:chloropicrin) has been marketed but not well-studied. Poling and Sc hiavone (2008) found that a 50:50 formulation of

iodomethane resulted in the hi ghest numerical total and market able yield of any treatment, although not significantly different than methyl bromide. According to the researchers, “Total and marketable yields were significantly greate r for fumigated soil than the untreated control

treatments. Midas 50:50 at the 180 lb/A broadcast rate with standard plastic, and Midas 50:50

at the 120 lb/A broadcast rate with VIF had the highest yields in th e study, but were not significantly different from methyl bromide at 175 lb/A with VIF. It is very interesting that the lower rate of Midas 50:50 (120 lb/A with VIF) was significantly higher in total and marketable yield than Midas 50:50 at the 140 and 160 rates with VIF. Also, the 180 lb/A rate (with VIF) was 7,272 lb/A lower in marketable yield than th e 120 lb/A rate of Midas 50:50 (with VIF) .”

USA CUN12 SOIL Strawberry Fruit Open Field Page 9 of 17Welker et al. (2008) found that in South Caroli na trials weed contro l was achieved under VIF with 1,3-D/chloropicrin (35 gal Telone C35), iodomethane/chloropicrin (168 kg/ha 50:50), and methyl bromide/chloropicrin (146 kg/ha, 50:50). However yield was significantly reduced with the 1,3-D/chloropicrin. Research ers suspected that under VIF, th at rate was too high stunted plants. In North Carolina trials, drip applied 1,3 -D/chloropicrin (InLine) and PicClor 60 resulted

in excellent annual weed contro l under VIF, where previous da ta had indicated unacceptable

weed control. Extension conducted an on-farm field day, which provided information on methyl bromide alternatives to growers.

Norton (2008) reported that use of 1,3-D/ch loropicrin followed by metam-sodium with appropriate water moisture could achieve excell ent disease and weed control. A 21-d waiting period was required prior to transplanting. As w ith the situation in Fl orida, use experience, availability, and equipment and rate adjustme nts for the new product may require a period of transition for a portion of strawberry land ma king some methyl bromide critical for 2011.

8. ECONOMIC FEASIBILITY OF ALTERNATIVES

The following economic analysis is organized by re gions. In this study net revenue is calculated as gross revenue minus operating costs. This is a good measure to describe the direct losses of income that may be suffered by the users. The net revenue does not represent net income to the users. Net income, which indicates profitability of an operation of an enterprise, is gross revenue minus the sum of operating and fixed costs. Net income should be smaller than the net revenue measured in this study. Fixed costs were not in cluded because it is often difficult to measure and verify.

Summary of Economic Feasibility

The economic analysis of strawberry fruit pr oduction compared data on yields, crop prices, revenues and costs using methyl br omide and using alternative pest control regimens in order to estimate the loss of methyl bromide availabilit y. The alternatives identified as technically feasible in cases of low pest infestation for Florida and the eastern U.S. states are: (a) iodomethane/chloropicrin and (b) 1,3-D/chl oropicrin followed by metam sodium. For California, the primary alternative is 1,3- D/chloropicrin followed by metam sodium. Iodomethane is not register ed for use in California.

The economic factors that drive th e feasibility analysis for fresh market strawberry fruit use of methyl bromide are increased production costs, wh ich may be due to the higher-cost of using an alternative, additional pest cont rol requirements, and/or resulting shifts in other production or harvesting practices and yield losses.

Crop budgets were analyzed for pre-plant sectors to determine the likely economic impact if methyl bromide were unavailable. Various m easures were used to quantify the impacts, including the following:

USA CUN12 SOIL Strawberry Fruit Open Field Page 10 of 17(1) Loss per Hectare. For crops, this measure is closely tied to income. It is relatively easy to measure, but may be difficult to interpret in isolation.

(2) Loss per Kilogram of Methyl Bromide . This measure indicates the value of methyl bromide to crop production.

(3) Loss as a Percentage of Gross Revenue. This measure has the advantage that gross revenues are usually easy to meas ure, at least over some unit, e.g. , a hectare of land or a storage operation. However, high value commodities or cr ops may provide high revenues but may also entail high costs. Losses of even a small per centage of gross revenues could have important impacts on the profitability of the activity.

(4) Loss as a Percentage of Net Operating Revenue . Net cash revenues are defined as gross revenues minus operating costs. This is a very g ood indicator of the direct losses of income that may be suffered by the owners or operators of an enterprise. However, operating costs can often be difficult to measure and verify.

(5) Operating Profit Margin . Operating profit margin is defined as net operating revenue divided by gross revenue per hectare. This measure would provide the best indication of the total impact of the loss of methyl bromide to an enterprise. Again, operating costs may be

difficult to measure and fixed costs even more di fficult, therefore fixed costs were not included in the analysis.

These measures represent different ways to a ssess the economic feasibili ty of methyl bromide alternatives for strawberry fru it producers. Because producers (s uppliers) represen t an integral part of any definition of a market , the threshold of significant market disruption is met if there is a significant impact on commodity suppliers us ing methyl bromide. The economic measures provide the basis for maki ng that determination.

In the case of strawberry fruit production, for the eastern growers who have access to iodomethane, an impact of 1-4% in gross revenue is expected in the first year of use due to increased costs to retrofit applic ation equipment (hoses, nozzles, fl ow meters) that will allow the

use of iodomethane. This cost is estimated to be approximately $600-$700 per acre based on

USG estimates. Southeastern and Florida strawb erry growers who use iodomethane are expected to experience no change in yield or quality (see tables 3 and 4 below).

For California strawberry producers, there is no change in impacts from previous years’ estimates as iodomethane is not expected to be re gistered in the near future. The loss to gross revenue for growers using alternat ives to methyl bromide is estimated to remain about 14% as compared to the use of methyl bromide. Table 5 illustrates the 2008 economic impact

assessment for California st rawberry fruit growers.

USA CUN12 SOIL Strawberry Fruit Open Field Page 11 of 17T ABLE 3. F LORIDA F RUIT AND V EGETABLE G ROWERS A SSOCIATION : E CONOMIC I MPACTS OF M ETHYL
B ROMIDE A LTERNATIVES

FLORIDA FVGA M ETHYL B ROMIDE I ODOMETHANE 1,3 D + PIC

P RODUCTION L OSS (%) 0% 0% 14%

P RODUCTION PER H ECTARE 2,989 2,989 2,559

* P RICE PER U NIT ( US $) $ 32.80 $ 32.80 $ 32.8

= G ROSS R EVENUE PER H ECTARE ( US $) $ 98,064 $ 98,064 $ 83,942

- O PERATING C OSTS PER H ECTARE ( US $)** $ 52,571 $ 56,525 $ 51,586

= N ET R EVENUE PER H ECTARE ( US $) $ 45,493 $ 41,538 $ 32,086

L OSS M EASURES *

1. L OSS PER H ECTARE ( US $) $ 0 $ 3,955 $ 13,407

2. L OSS PER K ILOGRAM OF M ETHYL B ROMIDE ( US $) $ 0 $ 16.8 $ 56.96

3. L OSS AS A P ERCENTAGE OF G ROSS R EVENUE (%) 0% 4% 14%

4. L OSS AS A P ERCENTAGE OF N ET O PERATING
R EVENUE (%) 0% 9% 29%

5. O PERATING P ROFIT M ARGIN (%) 46% 42% 38%

**Note that the measures in the tables below must be in terpreted carefully. Operating costs do not include fixed costs and net revenue equals gross revenue minus operating costs.

T ABLE 4. S OUTH E ASTERN S TRAWBERRY C OMMISSION : E CONOMIC I MPACTS OF M ETHYL B ROMIDE
A LTERNATIVES South Eastern Strawberry Commission M ETHYL B ROMIDE I ODOMETHANE 1,3 D + PIC

P RODUCTION L OSS (%) 0% 0% 0%

P RODUCTION PER H ECTARE 14,011 14,011 12,044

* P RICE PER U NIT ( US $) $ 2.89 $ 2.89 $ 2.89

= G ROSS R EVENUE PER H ECTARE ( US $) 40,463 $ 40,463 $ 34,784

- O PERATING C OSTS PER H ECTARE ( US $)** $ 33,175 $ 33,611 $ 32,744

= N ET R EVENUE PER H ECTARE ( US $) $ 7,288 $ 6,853 $2,039

L OSS M EASURES *

1. L OSS PER H ECTARE ( US $) $ 0 $ 436 $ 5,249

2. L OSS PER K ILOGRAM OF M ETHYL B ROMIDE ( US $) $ 0 $ 2.88 $ 34.69

3. L OSS AS A P ERCENTAGE OF G ROSS R EVENUE (%) 0% 1% 13%

4. L OSS AS A P ERCENTAGE OF N ET O PERATING
R EVENUE (%) 0% 6% 72%

5. O PERATING P ROFIT M ARGIN (%) 18% 17% 6%

**Note that the measures in the tables below must be in terpreted carefully. Operating costs do not include fixed costs and net revenue equals gross revenue minus operating costs.

USA CUN12 SOIL Strawberry Fruit Open Field Page 12 of 17T ABLE 5. C ALIFORNIA : E CONOMIC I MPACTS OF M ETHYL B ROMIDE A LTERNATIVES

CALIFORNIA M ETHYL B ROMIDE PIC + MB 1,3 D + PIC

P RODUCTION L OSS (%) 0% 15% 14%

P RODUCTION PER H ECTARE 49,410 41,999 42,475

* P RICE PER U NIT ( US $) $ 1.37 $ 1.37 $ 1.37

= G ROSS R EVENUE PER H ECTARE ( US $) $ 67,537 $ 66,020 $ 58,057

- O PERATING C OSTS PER H ECTARE ( US $)** $ 66,849 $ 57,432 $ 66,100

= N ET R EVENUE PER H ECTARE ( US $) $ 688 ($ 8,614) ($ 8,042)

L OSS M EASURES *

1. L OSS PER H ECTARE ( US $) $ 0 $ 9,302 $ 8730

2. L OSS PER K ILOGRAM OF M ETHYL B ROMIDE ( US $) $ 0 $ 46.36 $ 43.51

3. L OSS AS A P ERCENTAGE OF G ROSS R EVENUE (%) 0% 14% 13%

4. L OSS AS A P ERCENTAGE OF N ET O PERATING
R EVENUE (%) 0% `1352% 1269%

5. O PERATING P ROFIT M ARGIN (%) 4% -15% -14%

**Note that the measures in the tables below must be in terpreted carefully. Operating costs do not include fixed costs and net revenue equals gross revenue minus operating costs.

USA CUN12 SOIL Strawberry Fruit Open Field Page 13 of 178. RESULTANT CHANGES TO RE QUESTED EXEMPTION QUANTITIES

The USG has applied an aggressi ve transition rate, which is re flected in the nomination amount

and detailed in Table 6.

TABLE 6. N OMINATION A MOUNT :

USA CUN12 SOIL Strawberry Fruit Open Field Page 14 of 17CITATIONS

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