51926 Federal Register / Vol. 75, No. 163 / Tuesday, August 24, 2010 / Rules and Regulations 

use of the Internet and other 

information technologies to provide 

increased opportunities for citizen 

access to Government information and 

services, and for other purposes. 

A proposed rule regarding this action 

was published in the Federal Register 

on June 30, 2010 (FR 75 37740). Copies 

of the proposed rule were also made 

available to all apricot handlers by 

Committee staff. The proposal was also 

made available through the Internet by 

USDA and the Office of the Federal 

Register. A 15-day comment period 

ending July 15, 2010, was provided for 

interested persons to respond to the 

proposal. No comments were received. 

A small business guide on complying 

with fruit, vegetable, and specialty crop 

marketing agreements and orders may 

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

AMSv1.0/ams.fetchTemplate

Data.do?template=TemplateN&

page=MarketingOrdersSmallBusiness

Guide. Any questions about the 

compliance guide should be sent to 

Antoinette Carter at the previously 

mentioned address in the FOR FURTHER

INFORMATION CONTACT section. 

After consideration of all relevant 

material presented, including the 

information and recommendation 

submitted by the Committee and other 

available information, it is hereby found 

that this rule, as hereinafter set forth, 

will tend to effectuate the declared 

policy of the Act. 

Pursuant to 5 U.S.C. 553, it is also 

found and determined that good cause 

exists for not postponing the effective 

date of this rule until 30 days after 

publication in the Federal Register 

because: (1) The 2010–11 fiscal period 

began on April 1, 2010, and the order 

requires that the assessment rate for 

each fiscal period apply to all assessable 

apricots handled during such fiscal 

period; (2) Washington apricots are 

currently being harvested and shipped 

to market; (3) the Committee needs to 

have sufficient funds to pay its 

expenses, which are incurred on a 

continuous basis; (4) handlers are aware 

of this action, which was recommended 

by the Committee at a public meeting 

and is similar to other assessment rate 

actions issued in past years; and (5) a 

15-day comment period was provided in 

the proposed rule. 

List of Subjects in 7 CFR Part 922 

Apricots, Marketing agreements, 

Reporting and recordkeeping 

requirements. 

■ For the reasons set forth in the 

preamble, 7 CFR part 922 is amended as 

follows: 

PART 922—APRICOTS GROWN IN 

DESIGNATED COUNTIES IN 

WASHINGTON 

■ 1. The authority citation for 7 CFR 

part 922 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

■ 2. Section 922.235 is revised to read 

as follows: 

§ 922.235 Assessment rate. 

On and after April 1, 2010, an 

assessment rate of $1.50 per ton is 

established for the Washington Apricot 

Marketing Committee. 

Dated: August 17, 2010. 

Rayne Pegg, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 2010–21037 Filed 8–23–10; 8:45 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 984 

[Doc. No. AMS–FV–09–0036; FV09–984–4 

FR] 

Walnuts Grown in California; Changes 

to the Quality Regulations for Shelled 

Walnuts 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Final rule. 

SUMMARY: This rule revises the quality 

regulations for shelled walnuts under 

the Federal marketing order for 

California walnuts (order). The order 

regulates the handling of walnuts grown 

in California and is administered locally 

by the California Walnut Board (Board). 

This rule requires inspection and 

certification of shelled walnut products 

after manufacturing instead of before 

manufacturing. It also establishes a 

process to specify that manufactured 

products smaller than eight sixtyfourths of an inch in diameter are 

derived from walnut pieces that have 

been inspected and certified to U.S. 

Commercial grade standards. These 

changes will result in more efficient and 

cost-effective handler operations, and 

will certify the final Size And Grade Of 

All Manufactured Walnut Pieces. 

DATES: Effective Date: August 25, 2010. 

FOR FURTHER INFORMATION CONTACT: Jeff 

Smutny, Marketing Specialist, or Kurt J. 

Kimmel, Regional Manager, California 

Marketing Field Office, Marketing Order 

Administration Branch, Fruit and 

Vegetable Programs, AMS, USDA; 

Telephone: (559) 487–5901, Fax: (559) 

487–5906, or E-mail: 

Jeffrey.Smutny@ams.usda.gov or 

Kurt.Kimmel@ams.usda.gov. 

Small businesses may request 

information on complying with this 

regulation by contacting Antoinette 

Carter, Marketing Order Administration 

Branch, Fruit and Vegetable Programs, 

AMS, USDA, 1400 Independence 

Avenue, SW., STOP 0237, Washington, 

DC 20250–0237; Telephone: (202) 720– 

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

Antoinette.Carter@ams.usda.gov. 

SUPPLEMENTARY INFORMATION: This final 

rule is issued under Marketing Order 

No. 984, as amended (7 CFR part 984), 

regulating the handling of walnuts 

grown in California, hereinafter referred 

to as the ‘‘order.’’ The order is effective 

under the Agricultural Marketing 

Agreement Act of 1937, as amended (7 

U.S.C. 601–674), hereinafter referred to 

as the ‘‘Act.’’ 

The Department of Agriculture 

(USDA) is issuing this rule in 

conformance with Executive Order 

12866. This final rule has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. This rule is not intended 

to have retroactive effect. 

The Act provides that administrative 

proceedings must be exhausted before 

parties may file suit in court. Under 

section 608c(15)(A) of the Act, any 

handler subject to an order may file 

with USDA a petition stating that the 

order, any provision of the order, or any 

obligation imposed in connection with 

the order is not in accordance with law 

and request a modification of the order 

or to be exempted therefrom. A handler 

is afforded the opportunity for a hearing 

on the petition. After the hearing, USDA 

would rule on the petition. The Act 

provides that the district court of the 

United States in any district in which 

the handler is an inhabitant, or has his 

or her principal place of business, has 

jurisdiction to review USDA’s ruling on 

the petition, provided an action is filed 

not later than 20 days after the date of 

the entry of the ruling. 

This final rule revises the quality 

regulations for shelled walnuts to 

require inspection and certification after 

chopping or dicing them into smaller 

pieces (manufacturing) instead of before 

manufacturing, and to establish a 

process for specifying that 

manufactured products smaller than 

eight sixty-fourths of an inch in 

diameter are derived from walnut pieces 

that have been inspected and certified to 

U.S. Commercial grade standards. This 

will result in more efficient and costeffective handler operations and will 

certify the final size and grade of all 

manufactured walnut pieces. This rule 


wwoods2 on DSK1DXX6B1PROD with RULES_PART 1
Federal Register / Vol. 75, No. 163 / Tuesday, August 24, 2010 / Rules and Regulations 51927 

was unanimously recommended by the 

Board at a meeting on September 12, 

2008. 

Section 984.50(d) of the order 

provides authority for the Board to 

recommend to the Secretary additional 

grade, size, or other quality regulations 

for California walnuts. Section 984.52 of 

the order provides that handlers shall 

not change the form of shelled walnuts 

unless such walnuts have been certified 

as merchantable or meet quality 

regulations established under 

§ 984.50(d). 

Currently, all shelled walnuts are 

inspected and certified before 

manufacturing by the American Council 

for Food Safety & Quality (also known 

as DFA of California and hereinafter 

referred to as ‘‘DFA’’) to ensure the 

walnuts meet marketing order 

requirements for U.S. Commercial 

grade. Following inspection, walnut 

pieces may be further manufactured by 

chopping them into smaller pieces, or 

‘‘end products.’’ Pieces smaller than 

eight sixty-fourths of an inch that are 

accumulated during the manufacturing 

process are considered a byproduct of 

this process and are called ‘‘meal.’’ 

Walnut meal is sold into the market for 

industrial use, such as in commercial 

bakery products. 

Upon passing inspection, an 

inspection certificate is issued for the 

lot of shelled walnuts, and the 

certificate number follows the walnuts 

from that lot through the entire 

manufacturing process. The original 

inspection certificate number is noted 

on the certificates that accompany both 

the end products and the meal derived 

from the original lot of shelled walnuts. 

Providing information about the original 

lot of walnuts from which the end 

products and meal were derived assures 

customers that those products were 

derived from walnuts that meet quality 

standards under the order. 

The inspection certificate specifies 

the size of the shelled walnut pieces 

before manufacturing. The size may be 

stated as ‘‘large pieces’’ or ‘‘halves and 

pieces,’’ and that information is also 

noted on the certificates that accompany 

the end products and the meal, although 

it does not accurately describe the size 

of the manufactured end product pieces 

or meal. If a customer requires 

certification of the size of a finished end 

product, the handler must obtain a 

second inspection for that product, 

which may add expense to the process. 

Currently, meal may be co-mingled 

into one output bin as it is accumulated 

from the manufacturing of several 

different lots of shelled walnuts. When 

this occurs, the certificate number from 

each original lot of shelled walnuts is 

transferred to the meal certificate. As a 

result, the certificate for one output bin 

of meal may include multiple certificate 

numbers. 

Transferring the inspection certificate 

number from an original lot of shelled 

walnuts to various manufactured end 

products and meal is cumbersome and 

creates a potential for errors under the 

current system. Currently, all of a 

certified lot of shelled walnuts must be 

manufactured at one time to ensure the 

certificate number of that lot is properly 

transferred to the resulting end products 

and meal. If, at a future date, the end 

products from the original 

manufacturing run are remanufactured 

in order to be cut to a smaller size, the 

certificate numbers must be transferred 

from the first manufactured product to 

the second manufactured product. This 

additional process of transferring 

certificate numbers to and from multiple 

end products is cumbersome and further 

increases the potential for error. 

The Board’s Grades and Standards 

Committee formed a work group in May 

2008 to investigate alternatives to the 

current inspection and certification 

process of manufactured shelled 

walnuts. The work group recommended 

changing the existing process to allow 

handlers to manufacture shelled 

walnuts into smaller end products 

without prior inspection. Instead, 

handlers will be required to have all end 

products inspected. The manufactured 

pieces equal to or larger than eight sixtyfourths of an inch in diameter will be 

inspected and certified to existing U.S. 

Commercial grade requirements 

specified in the United States Standards 

for Shelled Walnuts (Juglans regia). 

Each end product that passes inspection 

will be issued an inspection certificate, 

which will include the actual size of the 

end product. 

The U.S. Commercial grade 

requirements do not include standards 

for walnut meal. Therefore, the meal 

accumulated during the manufacturing 

process will not be inspected. Meal 

collected from multiple manufacturing 

runs will no longer be co-mingled in 

one output bin but will remain 

segregated. 

A document also referred to as a 

‘‘meal certificate’’ will be issued for the 

walnut meal accumulated during each 

manufacturing run. Because the meal 

most closely resembles the color, 

freshness, and other characteristics of 

the smallest end product produced 

during manufacturing, the meal can be 

affiliated with that end product. If the 

end product passes inspection and is 

certified, the certificate number 

assigned to that end product will be 

referenced on the meal certificate. If that 

end product fails inspection, the meal 

created during the same manufacturing 

process will be rejected and disposed of 

pursuant to the requirements of 

§ 984.64. However, the end product that 

failed inspection can be reconditioned, 

re-sampled, and presented again for 

inspection and certification. 

These changes will improve the 

manufacturing process by eliminating 

the need for multiple inspections for the 

same product, and will improve handler 

efficiencies by eliminating duplicative 

inventory tracking. Consumers will be 

better served since each finished end 

product will be certified to U.S. 

Commercial grade requirements, and 

accurate size information for each end 

product will be provided on the 

individual inspection certificates. 

Handlers can continue to assure 

customers that walnut meal is derived 

from walnuts that have been inspected 

and certified. Accordingly, a new 

§ 984.450(c) containing these 

regulations will be added to the order’s 

administrative rules and regulations. 

This rule also revises the first 

sentence in § 984.450(a) regarding the 

minimum kernel content requirements 

of inshell walnuts for reserve 

disposition credit. The sentence 

incorrectly references requirements for 

inshell walnuts pursuant to § 984.59(a). 

The correct reference is § 984.50(a). The 

sentence is revised accordingly. 

Final Regulatory Flexibility Analysis 

Pursuant to requirements set forth in 

the Regulatory Flexibility Act (RFA) (5 

U.S.C. 601–612), the Agricultural 

Marketing Service (AMS) has 

considered the economic impact of this 

action on small entities. Accordingly, 

AMS has prepared this final regulatory 

flexibility analysis. 

The purpose of the RFA is to fit 

regulatory actions to the scale of 

business subject to such actions in order 

that small businesses will not be unduly 

or disproportionately burdened. 

Marketing orders issued pursuant to the 

Act, and the rules issued thereunder, are 

unique in that they are brought about 

through group action of essentially 

small entities acting on their own 

behalf. 

There are currently 58 handlers of 

California walnuts subject to regulation 

under the marketing order, and there are 

approximately 4,500 growers in the 

production area. Small agricultural 

service firms are defined by the Small 

Business Administration (SBA) (13 CFR 

121.201) as those having annual receipts 

of less than $7,000,000, and small 

agricultural producers are defined as 

those having annual receipts of less than 

$750,000. 


wwoods2 on DSK1DXX6B1PROD with RULES_PART 1
51928 Federal Register / Vol. 75, No. 163 / Tuesday, August 24, 2010 / Rules and Regulations 

USDA’s National Agricultural 

Statistics Service (NASS) reports that 

California walnuts were harvested from 

a total of 223,000 bearing acres during 

2008–09. The average yield for the 

2008–09 crop was 1.96 tons per acre, 

which is higher than the 1.56 tons per 

acre average for the previous five years. 

NASS reported the value of the 2008– 

09 crop at $1,210 per ton, which is 

lower than the previous five-year 

average of $1,598 per ton. 

At the time of the 2007 Census of 

Agriculture, which is the most recent 

information available, approximately 

89 percent of California’s walnut farms 

were smaller than 100 acres. Fifty-four 

percent were between 1 and 15 acres. A 

100-acre farm with an average yield of 

1.96 tons per acre would have been 

expected to produce about 196 tons of 

walnuts during 2008–09. At $1,210 per 

ton, that farm’s production would have 

had an approximate value of $237,000. 

Assuming that the majority of 

California’s walnut farms are still 

smaller than 100 acres, it could be 

concluded that the majority of the 

growers had receipts of less than 

$237,000 in 2008–09. This is well below 

the SBA threshold of $750,000; thus, the 

majority of California’s walnut growers 

would be considered small growers 

according to SBA’s definition. 

According to information supplied by 

the industry, approximately one-half of 

California’s walnut handlers shipped 

merchantable walnuts valued under 

$7,000,000 during the 2008–09 

marketing year and would therefore be 

considered to be small handlers 

according to the SBA definition. The 

firm that currently inspects and certifies 

shelled walnuts before manufacturing 

would likely be considered a large 

agricultural business firm. 

This final rule amends § 984.450 of 

the order’s administrative rules and 

regulations by adding a new paragraph 

(c) that requires inspection and 

certification of shelled walnuts after 

manufacturing instead of before 

manufacturing, and establishes a 

process for specifying that walnut meal 

is derived from manufactured walnut 

pieces that have been inspected and 

certified to U.S. Commercial grade 

standards. This results in more efficient 

and cost-effective handler operations, 

and certifies the final size and grade of 

all manufactured walnut pieces. 

Authority for these changes is provided 

in §§ 984.50(d) and 984.52 of the order. 

Regarding the impact of the action on 

affected entities, this final rule should 

not impose any additional costs. It 

should reduce costs to handlers by 

streamlining and improving the 

production process. Handlers will no 

longer need to track lots of shelled 

walnuts through the manufacturing 

process in order to tie those original lots 

to the manufactured end products and 

meal. Handlers will be able to more 

easily manage inventory and production 

since they will no longer be required to 

manufacture an entire lot of shelled 

walnuts at one time in order to transfer 

the certificate number of the original lot 

to each end product and the meal. Since 

handlers will no longer be required to 

transfer certificate numbers from an 

entire lot of shelled walnuts to multiple 

manufactured end products, a portion of 

a lot could be held for manufacturing or 

remanufacturing at a later date. 

The potential for errors will be 

reduced under the proposed system 

because fewer certificate numbers will 

be transferred. Each end product will 

have its own certificate number, and the 

certificate number of the smallest end 

product will be referenced on the meal 

certificate for the meal that was 

accumulated during the same 

manufacturing process. 

Handler costs will also be reduced 

when customers require manufactured 

product to be certified to U.S. 

Commercial grade requirements since 

this will be automatically provided 

under the proposed regulations. Under 

the current system, if a customer 

requires this type of certification after 

manufacturing, handlers may pay 

additional fees if an inspector makes a 

special trip to perform a second 

inspection. If a DFA inspector is already 

onsite at a handler’s facility, there is no 

additional charge for a second 

inspection. DFA charges $28.00 per 

hour with a four-hour minimum charge 

for a special visit to the handler’s site, 

for a minimum total charge of $112 per 

visit. 

While discussing this change, the 

Board considered lab testing the meal as 

an alternative to transferring the 

inspection certificate number of the 

smallest manufactured end product to 

the meal. There is no U.S. Commercial 

grade standard for meal, so it is not 

currently possible to inspect and certify 

it as meeting a standard. Quality 

standards for meal would need to be 

developed in order to pursue this 

alternative. In addition, lab testing the 

meal could increase handler costs. This 

alternative would also cause a delay in 

shipping in order to allow time for lab 

testing, and this could adversely impact 

marketing efforts. As a result, lab testing 

of meal was not considered a viable 

alternative. 

This final rule will not impose any 

additional reporting or recordkeeping 

requirements on either small or large 

walnut handlers. As with all Federal 

marketing order programs, reports and 

forms are periodically reviewed to 

reduce information requirements and 

duplication by industry and public 

sector agencies. 

AMS is committed to complying with 

the E-Government Act, to promote the 

use of the Internet and other 

information technologies to provide 

increased opportunities for citizen 

access to Government information and 

services, and for other purposes. 

USDA has not identified any relevant 

Federal rules that duplicate, overlap or 

conflict with this proposed rule. 

In addition, the Board’s meeting on 

September 12, 2008, when this action 

was considered, was widely publicized 

throughout the walnut industry. This 

issue was also deliberated at a Grades 

and Standards Committee meeting on 

May 20, 2008; a Board meeting on May 

28, 2008; and a Grades and Standards 

Committee work group meeting on 

September 2, 2008. Like all Board 

meetings, these meetings were public 

meetings, and all interested persons 

were invited to attend the meetings and 

participate in deliberations on all issues. 

A proposed rule concerning this action 

was published in the Federal Register 

on June 21, 2010 (75 FR 34950). Copies 

of the rule were mailed or sent via 

facsimile to all Board members and 

walnut handlers. Finally, the rule was 

made available through the Internet by 

USDA and the Office of the Federal 

Register. A 15-day comment period 

ending July 6, 2010, was provided to 

allow interested persons to respond to 

the proposal. 

Two comments were received during 

the comment period in response to the 

proposal. Both comments were made in 

support of the proposal. 

Accordingly, no changes will be made 

to the rule as proposed, based on the 

comments received. 

A small business guide on complying 

with fruit, vegetable, and specialty crop 

marketing agreements and orders may 

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

AMSv1.0/ams.fetchTemplate

Data.do?template=TemplateN&page=

MarketingOrdersSmallBusinessGuide. 

Any questions about the compliance 

guide should be sent to Antoinette 

Carter at the previously mentioned 

address in the FOR FURTHER INFORMATION

CONTACT section. 

After consideration of all relevant 

matters presented, including the 

information and recommendation 

submitted by the Board and other 

available information, it is hereby found 

that this rule, as hereinafter set forth, 

will tend to effectuate the declared 

policy of the Act. 


wwoods2 on DSK1DXX6B1PROD with RULES_PART 1
Federal Register / Vol. 75, No. 163 / Tuesday, August 24, 2010 / Rules and Regulations 51929 

It is further found that good cause 

exists for not postponing the effective 

date of this rule until 30 days after 

publication in the Federal Register 

(5 U.S.C. 553) because this rule should 

be in place for the upcoming marketing 

year, which begins September 1, 2010. 

Further, handlers are aware of this rule, 

which was recommended at a public 

meeting. Also, 15 days were provided 

for comments to the proposed rule. 

List of Subjects in 7 CFR Part 984 

Marketing agreements, Nuts, 

Reporting and recordkeeping 

requirements, Walnuts. 

■ For the reasons set forth in the 

preamble, 7 CFR part 984 is amended as 

follows: 

PART 984—WALNUTS GROWN IN 

CALIFORNIA 

■ 1. The authority citation for 7 CFR 

part 984 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

§ 984.450 [Amended] 

■ 2. Section 984.450 is amended by 

revising the first sentence in paragraph 

(a) and adding a new paragraph (c) to 

read as follows: 

§ 984.450 Grade and size regulations. 

(a) Minimum kernel content 

requirements for inshell walnuts for 

reserve disposition credit. For purposes 

of §§ 984.54 and 984.56, no lot of inshell 

walnuts may be held, exported, or 

disposed of for use by governmental 

agencies or charitable institutions 

unless it meets the minimum 

requirements for merchantable inshell 

walnuts effective pursuant to 

§ 984.50(a). * * * 

* * * * * 

(c) Inspection and certification of 

shelled walnuts that are manufactured 

into products. For purposes of 

§§ 984.50(d) and 984.52(c), shelled 

walnuts may be cut or diced without 

prior inspection and certification: 

Provided, That the end product, except 

for walnut meal, is inspected and 

certified. For purposes of this section, 

end product shall be defined as walnut 

pieces equal to or larger than eight sixtyfourths of an inch in diameter. Walnut 

meal shall be defined as walnut pieces 

smaller than eight sixty-fourths of an 

inch in diameter. 

(1) End product. End product must be 

sized, inspected and certified, and the 

size must be noted on the inspection 

certificate. The end product quality 

must be equal to or better than the 

minimum requirements of U.S. 

Commercial grade as defined in the 

United States Standards for Shelled 

Walnuts (Juglans regia). 

(2) Walnut meal. Walnut meal that is 

accumulated during the cutting or 

dicing of shelled walnuts to create end 

product must be presented with the 

smallest end product from that 

manufacturing run that is inspected and 

certified. If the end product meets the 

applicable U.S. Commercial grade 

requirements, the walnut meal 

accumulated during the manufacture of 

that end product shall be identified and 

referenced on a separate meal certificate 

as ‘‘meal derived from walnut pieces 

that meet U.S. Commercial grade 

requirements.’’ The certificate number of 

the smallest end product will be 

referenced on the meal certificate. 

(3) Failed lots. If the end product fails 

to meet applicable U.S. Commercial 

grade requirements, the end product 

may be reconditioned, re-sampled, 

inspected again, and certified. However, 

the walnut meal accumulated during the 

manufacture of that end product shall 

be rejected and disposed of pursuant to 

the requirements of § 984.64. 

Dated: August 17, 2010. 

Rayne Pegg, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 2010–21010 Filed 8–23–10; 8:45 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 1000 

[Doc. No. AMS–DA–09–0062; AO–14–A73, et 

al.; DA–03–10] 

Milk in the Northeast and Other 

Marketing Areas; Order Amending the 

Orders 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Final rule. 

SUMMARY: This final rule maintains the 

current fluid milk product definition’s 

compositional standard of 6.5 percent 

nonfat milk solids criterion and 

incorporates an equivalent 2.25 percent 

true milk protein criterion for 

determining if a product meets the 

compositional standard. This final rule 

also determines how milk and milkderived ingredients should be priced 

under all Federal milk marketing orders 

when used in products meeting the 

fluid milk product definition. It 

provides exemptions for drinkable 

yogurt products containing at least 20 

percent yogurt (by weight), kefir, and 

products intended to be meal 

replacements from the fluid milk 

product definition. A referendum was 

held and the required number of 

producers approved the issuance of the 

orders as amended. 

DATES: Effective Date: January 1, 2011. 

FOR FURTHER INFORMATION CONTACT: 

Henry H. Schaefer, Economist, USDA/ 

AMS/Dairy Programs, Upper Midwest 

Milk Market Administrators Office, 

Suite 200, 1600 West 82nd Street, 

Minneapolis, Minnesota 55431–1420, 

(952) 831–5292, e-mail address: 

hschaefer@fmma30.com; or William 

Francis, Associate Deputy 

Administrator, USDA/AMS/Dairy 

Programs, Order Formulation and 

Enforcement, Stop 0231—Room 2971–S, 

1400 Independence Avenue, SW., 

Washington, DC 20250–0231, (202) 720– 

6274, e-mail address: 

william.francis@ams.usda.gov. 

SUPPLEMENTARY INFORMATION: This final 

rule amends the fluid milk product 

definition in all Federal milk marketing 

orders. This rulemaking action 

maintains the current fluid milk product 

definition’s compositional standard of 

6.5 percent nonfat milk solids and 

incorporates an equivalent 2.25 percent 

true milk protein criterion for 

determining if a product meets the 

compositional standard. This final rule 

also amends determining how milk and 

milk-derived ingredients should be 

priced under all Federal milk marketing 

orders when used in products meeting 

the fluid milk product definition. It 

exempts drinkable yogurt products 

containing at least 20 percent yogurt (by 

weight), kefir, infant formulas, dietary 

products (meal replacements) and other 

products that may contain milk-derived 

ingredients from the fluid milk product 

definition. 

This administrative action is governed 

by the provisions of sections 556 and 

557 of Title 5 of the United States Code 

and, therefore, is excluded from the 

requirements of Executive Order 12866. 

This final rule herein has been 

reviewed under Executive Order 12988, 

Civil Justice Reform. The final rule is 

not intended to have a retroactive effect. 

The Agricultural Marketing 

Agreement Act of 1937 (Act), as 

amended (7 U.S.C. 601–674), provides 

that administrative proceedings must be 

exhausted before parties may file suit in 

court. Under section 608c(15)(A) of the 

Act, any handler subject to an order may 

request modification or exemption from 

such order by filing with the 

Department a petition stating that the 

order, any provision of the order, or any 

obligation imposed in connection with 

the order is not in accordance with the 

law. A handler is afforded the 


wwoods2 on DSK1DXX6B1PROD with RULES_PART 1