### Initial Regulatory Flexibility Analysis Proposed Rule Importation of Bromeliad Plants in Growing Media from

Belgium, Denmark and the Netherlands

Docket No. 2010 - 0005

U.S. Department of Agriculture Animal and Plant Health Inspection Service

Ma rch 20101



### Summary
The regulations in 7 CFR part 319 prohibit or restrict the importation into the United States of certain plants and plant products to prevent the introduction of plant pests and noxious weeds. The current regulations allow the importation of Bromeliad plants from all countries of the world, but only under certain conditions, including the condition that the plants be free of sand, soil, earth, and other growing media. The proposed rule would amend the regulations to allow, under certain co nditions, the importation into the United States of plants of the Bromeliaceae genera of Aechmea , Cryptanthus , Guzmania , Hohenbergia , Neoregelia , Tillandsia , and Vriesea in approve d growing media from Belgium, Denmark, and the Netherlands. APHIS has concl uded, based on a pest risk analysis, that the current prohibition on imports of Bromeliaceae plants in growing media from the three countries is no longer necessary to prevent the introduction of plant pests or noxious weeds. The proposed rule is in respo nse to requests made by the Governments of Belgium, Denmark, and the Netherlands. Bromeliad plants are most commonly used as houseplants or landscape ornamentals in warmer climates.
APH IS does not expect the proposed rule to have a significant economic imp act on a substantial number of small entitie s, as there are believed to be relatively few U.S. producers of Bromeliad plants, the entities who stand to be affected most by the rule. This initial regulatory flexibility analysis describes the proposed rule’ s expected small

- entity impact and it specifically seeks public comment on that expected impact , as only limited data were available for analysis

. Most U.S. growers of Bromeliad plants are likely to be small entities under the SBA’s standards.2



### Table o f Contents Summary...................................................................... ........................1 Introduction

.......................................................................................... 3 Initial Regulatory Flexibility Analysis............................................................. 3 Reasons Action is Being Considered.......................................

... ........... 4 Objectives of and Legal Basis for t he Rule....................................... .......4 Potentially Affected Small Entities....................................................... 4 Projected Reporting, Recordkeeping, and Other Compliance Requirements........ 7 Duplication, Overlap, or Conflict with Existing Rules and Regulations............. 7 Alternatives to Minim ize Significant Economic Impact of the Rule.................. 73



### Introduction
The regulations in 7 CFR part 319 prohibit or restrict the importation into the United States of certain plants and plant products to prevent the introduction of plant pests and noxious

we eds. The current regulations allow the importation of Bromeliad plants from all countries of the world, but only under certain conditions, including the condition that the plants be free of sand, soil, earth, and other growing media. Such plants are gene rally imported bare

- rooted into the United States, and are rooted and potted for sale by U.S. nurseries. The proposed rule would amend 7 CFR 319.37

- 8(e) to allow, under certain conditions, the importation into the United States of plants of the Bromeliacea e genera of Aechmea , Cryptanthus , Guzmania , Hohenbergia , Neoregelia , Tillandsia , and Vriesea in approve d growing media from Belgium, Denmark, and the Netherlands. APHIS has concluded, based on a pest risk analysis, that the current prohibition on imports of Bromeliaceae plants in growing media from the three countries is no longer necessary to prevent the introduction of plant pests or noxious weeds. Bromeliad plants are most commonly used as houseplants or landscape ornamentals in warmer climates.



### Initia l Regulatory Flexibility Analysis
The Regulatory Flexibility Act requires agencies to evaluate the potential effects of their proposed and final rules on small businesses, small organizations and small governmental jurisdictions.4

For the reasons discusse d below, we do not believe that the proposed rule would have a significant economic impact on a substantial number of small entities. However, because hard economic data on Bromeliad plants

-- especially current data

-- are virtually nonexis tent, we are

r eluctant to make such a certification under section 605(b) of the Act

. 1 In the absence of a certification, section 603 of the Act requires agencies to prepare , and make available for public

comment , an initial regulatory flexibility analysis that describe s the proposed rule’s expected small

- entity impact s based on the available data

. Reasons Action is Being Considered The proposed rule is in response to requests made by the Governments of Belgium, Denmark, and the Netherlands. 2 Objectives of and Legal Basis for the Rule The goal of the rule is to allow, under certain conditions, the importation into the United
States of plants of the Bromeliaceae genera of Aechmea , Cryptanthus , Guzmania , Hohenbergia , Neoregelia , Tillandsia , and Vriesea in approve d grow ing media from Belgium, Denmark, and the Netherlands. The authority citation for part 319 is set forth in the rule. Potentially Affected Smal l Entities Currently, Bromeliad plants are imported into the United States

-- primarily in bare root form

-- by nurseries. 3 The nurseries generally import young (immature) plants, and then grow

1 Under section 605(b) of the Act, there must be a factual basis for a certification. 2 European B romeliad growers have state d that the current APHIS requirement for washi ng of the roots with water (to remove the growing media) is detrimental because it: ( 1) increases the number of plant losses ; ( 2) limits the size of the plant to be exported to the U

. S

. as “ young ” plants (versus larger “ finished ” plants at or near the flow ering stage g enerating increased revenue) ; and ( 3) results in temporary plant growth reductions.

3 Bare

- rooted plants comprise the bulk of all U.S. Bromeliad imports. Non

- bare

- rooted tissue culture plants (in a bottle or flask) account for essentially all other U.S. Bromeliad imports.5

them out and finish them in pots for sale in the U.S. market, primarily to retailers. 4 Under the proposed rule, producers in Belgium, Denmark, and the Netherlands would be able to ship
genera - specific Bromeliad plants to the United States in growing media, thereby eliminating the need for re

- potting by domestic nurseries. The rule would, in effect, allow Bromeliad growers in the three countries to bypa ss domestic nurseries altogether and provide finished plants directly to
U.S. retailers. The number of U.S. nurseries that currently import Bromeliad plants from Belgium, Denmark, and the Netherlands is unknown but is estimated to be no more than about three, with most or all of those located in Florida. 5 Over the last four years, the volume of U.S. imports of Bromeliad plants (in units) from the Netherlands was as follows: 759,684 (2009), 1,592,571 (2008), 2,136,109 (2007), and 2,350,476 (2006). The v olume of U.S. imports of Bromeliad plants from Belgium and Denmark is unknown. 6 The sharp decline in imports from the Netherlands between 2006 and 2009 is due primarily to the economic recession in the United States and to the weakening of the U.S. dollar relative to the euro. 7 Dutch officials estimate that, with the proposed rule in effect, Bromeliad exports to the United States from the Netherlands could reach the 2006 level, and even increase beyond that by 5 to 10 percent per year given favorable econo mic conditions. The estimated

4 Bare

- rooted plants can be imported at various stages of growth: as plugs, as immature (“young”) plants, or as mature (“flowering”) plants. Imports of bare

- rooted mature plants are virtually nonexistent because the re

- potti ng in the U.S. causes the plants to lose their buds.

5 Source: William Aley (APHIS). 6 Harmonized Tariff Schedule trade data does not offer the level of detail necessary to identify imports of Bromeliad plants, much less specific genera of Bromeliad pl ants. Trade data for the Netherlands was provided by a Dutch grower and is considered unofficial.

7 The weakening of the dollar has made imports from the Netherlands

-- and other euro currency countries

-

- more costly for U.S. consumers.6

volume of U.S. imports of Bromeliad plants from Belgium and Denmark under the proposed rule is unknown. 8 Although the rule would allow the affected foreign growers to bypass domestic nurseries and provide finished plants d irectly to U.S. retailers, such a scenario is not considered to be a certainty, given the problems associated with shipping finished plants in pots. 9 It is possible, therefore, that the affected foreign growers would continue to export immature plants to domestic nurseries

-- albeit in growing media instead of in bare root form

-- who would then grow them out for sale as finished plants. However, even if the rule does result in the elimination of domestic nurseries from the marketing chain, few such nurs eries would likely be affected. As indicated above, it is estimated that there are no more than about three U.S. nurseries that currently import Bromeliad plants from Belgium, Denmark, and the Netherlands. The proposed rule also has the potential to affec t domestic growers who produce Bromeliad plants from seed (as opposed to those who import immature plants and then grow them out for sale), to the extent that their sales are displaced by imports in growing media from Belgium, Denmark, and the Netherlands. However, there is no basis to conclude that domestic producers who grow plants from seed would be unable to compete with the imports on the basis of price, the factor that is most likely to drive consumer purchases. Furthermore, most domestic growers of Bromeliads also produce other plant varieties; any impact of imports on most domestic producers, therefore, would be muted because Bromeliads account for only a portion of their overall income. 10 The exact number of U.S. growers who currently produce Brom eliad plants from seed is unknown but is estimated to be relatively small

-- no more than about 100,

8 The regulatory workplan states that imports under this rule could total approximately “10 containers (120 tons)” per year. The number of plants represented by that volume is unknown.

9 F inished plants tend to lose flower buds during shipment

. 10 Source: William Aley (APHIS).7

most or all of whom are located in California, Florida and Texas. 11 This estimate is consistent with the most recent historical data, which shows the minor role of Bromeliads in the overall domestic nursery trade. In 1998, the latest year for which data are available, only 7 of the 5,008 U.S. growers of potted flowering plants produced Bromeliads, and only 148 of the 2,419 U.S. growers of potted foliage pla nts produced Bromeliads. In that same year, sales of potted flowering Bromeliads (80,000 pots) comprised less than 1 percent of all potted flowering plant sales (251,684,000 pots), and sales of potted foliage Bromeliads (6,712,000 pots) comprised less tha n 4 percent of all potted foliage plant sales (200,110,000 pots). 12 It is reasonable to assume that most U.S. growers of Bromeliads are small in size, by the standards of the U.S. Small Business Administration (SBA). This assumption is based on
compos ite data for providers of the same or similar services in the United States. In 2007, the per farm average gross receipts for all 54,889 U.S. farms in NAICS 1114 (“Greenhouse, Nursery, and Floriculture Production,” which includes Bromeliad producers) was $309,117, well below the SBA’s small

- entity threshold for those farms, i.e., $750,000 in annual gross receipts. 13 Projected Reporting, Recordkeeping, and Other Compliance Requirement s This proposed rule contains no mandatory reporting, recordkeeping, or other compliance requirements for U.S. entities. Duplication, Overlap , or Conflict with Existing Rules and Regulations APHIS has not identified any duplication, overlap, or conflict of this proposed rule with other Federal rules.

11 Source: Robert Griesbach (ARS). 12 Source: 1998 Census of Horticultural Specia l ties (NASS). 13 Source: 2007 Census of Agriculture (NASS) and SBA.8

Alternatives to Minimize S ignificant Economic Impacts of the Rule APH IS does not expect the proposed rule to have a significant economic impact on a substantial number of small entities , if for no other reason than there are believed to be relatively few U.S. producers of Bromeliad plants, the entities who stand to be affected most by the rule. This is not to suggest, however, that some Bromeliad producers might not be significantly affected by the proposal, especially any who grow Bromeliads exclusively.
W e have not identified a ny alternatives to the proposed rule that accomplish the stated objectives of applicable statutes and that minimize the rule’s potentially significant economic impact on Bromeliad producers. Given APHIS’ obligations under the Plant Protection Act and
inte rnational trade agreements, we do not believe continuing to prohibit the importation of Bromeliad plants in growing media is justified, since we have determined that Bromeliads from Belgium, Denmark, and the Netherlands can be imported in growing media wi thout introducing plant pests or noxious weeds or diseases into the United States. Under international trade agreements that the United States has entered into, we are bound to allow the importation of agricultural products if those products can be import ed safely, i.e., without introducing pests or diseases into the United States.