### United States

Department of Agriculture
Anim al and Plant Health Inspection Service June 2011 Final Regulatory Flexibility Analysis

Final Rule APHIS - 2010 - 0127 RIN 0579 - AD34
Host status of ‘Hass’ avocados to Mediterranean fruit fly, Ceratitis capitata (Wiedemann) and South American fruit fly, Anastrepha fraterculus

Policy & Program Development Policy Analysis & Developmenti



### Summary

APHI S has concluded that the Hass avocado is a limited host for Medfly and South American fruit fl y. Consequently, cold treatment, methyl bromide fumigation, or production in a Medfly

- free and South American fruit fl y - free area will no longer be necessa ry for commerciall y produced avocadoes imported from countries where either of these pests is known to occur, such as Mexico and Peru. APHIS will continue to require fruit to be commercially produced , harvested from the tree and not picked up from the gro und , and safeguarded after harvest until arrival at the port of entry in the United States to prevent infestation by Medfl y or the South American fruit fly

. Within the United States, avocado fruit is primarily produced in California, Hawaii, and Florida. There were approximately 8,200 farms producing avocados in those states in 2007. About 180,000 MT of avocados were produced annually in the United States over a 20 y ear period beginning in the 1990/91 season. There is an occasional fluctuation with an occ asional higher or lower production amount than other years; the variance in avocado production can be attributed to various circumstances including inclement weather and drought. Currently , the costs associated with the Mediterranean fruit fl y mitigation m easures o n Hass avocados from Mexico and Peru have increased the cost of imported avocados for

consumers. Removing requirements for treatment, trapping, and origin restrictions for Hass avocados from Mexico, Chile, and Peru due to Mediterranean fruit fly and South American fruit fly will reduce the cost associated with mitigation for producers, and in conseque nce, likel y lower the cost of imported avocados for U.S. consumer s
. The impact of the rule on Hass avocado fruit operations in California, Hawaii, and Florida w ill depend on the volume and season of increased Hass avocado imports from Mexico and Peru, the volume and season of continental U.S. production, the volume and season of imports from other countries, a s well as U.S. consumption and export levels. Consumer demand for avocados has increased greatl y in the past decade. Imports of Hass avocados incre ased from 56,000 MT in 2001 to a high of 420,000 MT in 2009. The countries affected b y the mitigation treatment changes in this rule already export Hass avocados to the United States. I t is worth noting that the increase in imports of Hass avocados has o ccurred over the last 10 ye ars while U.S. domestic avocado production quantitiesii

and values have remained relativel y stable. It would appear that the domestic market for avocados continues to expand to absorb both increasing imports and existing domestic production rather than new avocado imports displacing either domestic production or existing imports . I t therefore does not appear that the current increasing level of imports has had a significant impact on a substantial number of small avocado producers or importers.iii



### Table of Contents Summary

................................ ................................ ................................ .............................. i
Introduction

................................ ................................ ................................ ......................... 1 Final Regulatory

Fle xibility

Anal ys is

................................ ................................ ................. 1 Need for and Objectives of the Rule

................................ ................................ ............... 1 Significant Issues raised by Public Comment in response to the Initial Regulatory Flexibility

Anal ys is

................................ ................................ ................................ ........ 2 Significant Issues raised by the Small Business Administration in response to the Initial Regulatory

Flexibility

Anal ys is

................................ ................................ ........... 2 Potentially

Affected Small Entities

................................ ................................ ................. 2 Projected Reporting, Recordkeeping, and Other Compliance Requirements

................. 5 Steps taken by

APHI S to minimize Significant Economic I mpacts on Small Entities

.. 51



### Introduction
Under current regulations, APHI S recognizes the Hass avocado as a host plant to the Mediterranean fruit fly (Medfly ) and the South American fruit fly , and requires that avocado imports be either cold treated or fumigated with methy l bromide unless the fruit originates from an area free of Medfl y and the South American fruit fly

. In light of recent research and available evidence, APHI S has concluded that the Hass avocado is a limited host for these two pests

. Consequently , cold treatment , methy l bromide fumigation, or production in a Medfl y - free and South American fruit fl y - free area will no longer be necessary for commercially

produced avocadoes imported from countries where either of these pests is known to occur, such as Mexico and Peru. APHI S will continue to require the following risk miti gation measures for the import ation of Hass avocado from regions where Medfly or the South American fruit fl y is known to occur : the fruit must be commerciall y produced , harvested from the tree and not picked up from the ground , and safeguarded after harve st until arrival at the port of entry in the United States to prevent infestation by Medfly or the South American fruit fl y. The rule also amends domestic regulations to provide for the interstate movement under certificate of Hass avocado from areas in th e United States quarantined for Medfly when such quarantines may

occur, if the fruit is accordingl y s afeguarded after harvest. 

### Final 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. Section 60 4 of the Act requires agencies to prepare and make available for public comment a final regulatory flexibility

analy sis that describes expec ted impacts of a rule on small entities. Need for and Objectives of the Rule The rule follows determination of the limited host status of Hass avocado for Medfl y and the South American fruit fly

. The regulatory change is in accordance with International Plant Protection Convention standards that call for countries to require the least restrictive risk mitigation measures that are consistent with ensuring ph yt osanitary securit y. The objective of2

the rule is to revise and harmonize APHI S’ foreign quarantine and domestic movement requirements for Hass avocado in accordance with scientific evidence.
Significant Issues raised by Public Comment in response to the Initial Regulatory Flexibility Analysi s
Significant issues raised by commenters regarding the initial regulatory flexibility anal ys is are discussed in detail in the final rule.
Significant Issues raised by the Small Business Administration in response to the Initial Regulatory Flexibility An alysis
No significant issues were raised b y the Small B usiness Administration in response to the Initial Regulatory

Flexibility

Anal ys is.
Potentially Affected Small Entities Potentially

affected entities include U.S. producers and importers of Hass avoca do fruit. The Small Business Administration has established guidelines for determining which entities are to be considered small. Entities producing Hass avocado fruit are classified within NAI CS 111339, other non

- citrus fruit farming. The small

- entity standard for farms is annual receipts of not more than $750,000. 1 Im porters of Hass avocado fruit are a part of the wholesaling sector, and are classified within NAI CS 424480, fresh fruit and vegetable merchant wholesalers. The small

- entity

standard is not more than 100 employees. The average market value of crops sold by farms within the other non

- citrus fruit farming classification in 2007 was approximately $111,000. 2 About 95 percent of fruit and vegetable wholesalers were considered small in 2002

. 3 From this it can be infer

red that the majority of affected producers and importers of Hass avocado fruit are likel y t o be considered small

.

1 Source: 2007 Census of Agriculture (NASS) and SBA 2 2007 Census of Agriculture , Table 32

. Selected Characteristics of Farms by North American Industry Classification System: 2007 , http://www.agcensus.usda.gov/Publications/2007/Full_Report/Volume_1,_Chapter_1_US/usv1.pdf 3 U.S. Census Bureau, 2002 Economic Census. Data from the 2007 Economic Census are not yet availa ble for this industry category.3

Within the United States, avocado fruit is primarily produced in California, Hawaii, and Florida. The total nu mber of farms recorded in 2007 was 8,245; California had a total of 6,230 farms, Hawaii had 1,047 farms, and Florida had 951 farms. 4 Table 1 shows the production amount of avocados in the United States for seasons beginning in 1990 until 2010; it consists of the production amount of the two highest avocado producing states along with the total production amount for the United States. The table depicts a steady production rate of avocadoes over an approximately

20 y ear period ; the average production rate w as 160,438 MT in California, 19,058 MT in Florida, and 179,823 MT in the entire United States. There is an occasional fluctuation with an occasional higher or lower production amount than other y ears; the variance in avocado production can be attributed t o various circumstances including inc lement weather and drought

.

Table 1 . U.S. , California, and Florida avocado production and value, seasons 1990

- 20 10

4 2007 Census of Agriculture , Table 32

. Selected Characteristics of Farms by North American Industry Classification System: 200 7 , http://www.agcensus.usda.gov/Publications/2007/Full_Report/Volume_1,_Chapter_1_US/usv1.pdf Season California Florida United States

Production (metric tons) Value

(million dollars) Production

(metric tons) Value

(million dollars) Production

(metric tons) Value

(million dollars) 1990/1991 123 , 379 191.8 17 , 781 13.4 141 , 569 205.6 1991/1992 141 , 523 182.5 25 , 674 13.5 167 , 578 196.4 1992/1993 257 , 645 113.6 6 , 532 4.2 264 , 494 118.1 1993/1994 126 , 101 251.6 3 , 992 3.6 130 , 319 255.4 1994/1995 140 , 616 229.9 18 , 144 12.3 158 , 987 242.5 1995/1996 155 , 131 234.8 17 , 237 11.3 172 , 595 246.4 1996/1997 151 , 502 260.2 21 , 319 12.4 173 , 003 272.8 1997/1998 139 , 709 263.5 21 , 773 14.0 161 , 708 277.8 1998/1999 123 , 379 327.0 20 , 866 16.5 144 , 472 343.7 1999/2000 146 , 059 339.6 19 , 958 16.5 166 , 290 356.4 2000/2001 193 , 234 315.8 23 , 587 15.2 217 , 111 331.4 2001/2002 181 , 440 358.0 20 , 866 15.5 202 , 578 373.9 2002/2003 152 , 410 364.6 28 , 123 17.2 180 , 850 382.2 2003/2004 195 , 955 380.2 15 , 422 13.7 211 , 722 394.4 2004/2005 136 , 987 276.3 25 , 402 14.4 162 , 724 291.2 2005/2006 272 , 160 342.0 10 , 886 11.3 283 , 409 353.84

*Season beginning November 1 to November 30 (follow ing year) for California and June 20 to February 28 for Florida

. Source: USDA, National Agricultural Statistics Service, Noncitrus Fruits and Nuts Summary, various issues Currently , the costs associated with the Mediterranean fruit fl y mitigation measures o n Hass avocados from Mexico and Peru have increased the cost of imported avocados for

consumers. Removing requirements for treatment, trapping, and origin restrictions for Hass avocados from Mexico and Peru due to Medfl y and South American fruit fly will reduce the cost associated with mitigation for producers, and in consequence, likel y lower the cost of imported avocado s for U.S. consumer s
. The impact of the rule on Hass avocado fruit operations in California, Hawaii, and Florida w ill depend on the volume and season of increased Hass avocado imports from Mexico and Peru, the volume and season of continental U.S. product ion, the volume and season of imports from other countries, a s well as U.S. consumption and export levels. Co nsumer demand for avocados has increased greatl y in the past decade. Imports of Hass avocados increased from 56,000 MT in 2001 to a high of 420,0 00 MT in 2009 (table 2). Table 2. U.S. Imports of Hass Avocados, 2001

- 2010.
Partner Country 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 1,000 MT
World 55.8 108.8 127.4 136.6 251.8 182.3 336.7 302.7 419.9 332.7
Chile 45.6 78.0 90.3 93.6 134.2 108.9 219.4 234.5 300.6 266.6
Mexico 6.6 26.7 34.9 38.7 114.8 71.2 111.7 64.6 116.6 63.4
New Zealand 2.1 1.8 0.1 0.1 0.1

- 2.4 0.0 0.3

- Dominican Republic 1.3 2.3 2.1 4.2 2.7 2.2 3.2 3.6 2.4 2.5
Cook Islands 0.1

- - - - - - - - - Ecuador

- 0.0 0.1

- - - - - - - Brazil

- 0.0

- - 0.1

- - - - - Peru 2006/2007 119 , 750 249.5 12 , 701 12.8 132 , 914 262.9 2007/2008 149 , 688 328.4 24 , 948 12.1 175 , 162 341.2 2008/2009 79 , 834 200.6 24 , 903 13.2 105 , 190 214.5 2009/2010 222 , 264 330.8 21 , 047 13.9 243 , 783 345.45 - - - - - - - - 0.0 0.1 Source: Global Trade Information Services, Inc. T he countries affected b y the mitigation treatment changes in this rule already ex port Hass avocados to the United States. It is worth noting that th e increase in imports of Hass avocados has occurred over the last ten y ears occurred while U.S. domestic avocado production quantities and values have remained relativel y stable. It would appear that the domestic market for avocados continues to expand to absorb both increasing imports and existing domes tic production rather than displacement. It therefore does not appear that the current increasing level of imports has had a significant impact on a substantial number of small avocado producers or importers.
Projected Reporting, Recordkeeping, and Oth er Compliance Requirements APHI S has concluded that the Hass avocado can be considered a non

- host for these two pests. Consequently , cold treatment, methy l bromide fumigation, or production in a Medfly

- free and South American fruit fly

- free area will no longer be necessary for commerciall y produced avocadoes imported from countries where either of these pests is known to occur, such as Mexico and Peru. APHI S will continue to require fruit to be commercially produced , harvested from the tree and not picked up from the ground , and safeguarded after harvest until arrival at the port of entry in the United States to prevent reinfestation by Medfly or the South American fruit fl y
. Reporting and recordkeeping requirements associated with the final rule are discussed in the rule under the heading "Paperwork Reduction Act."
Steps taken by APHIS to minimize Significant Economic Impacts on Small Entities APHI S has read and reviewed all the comments provided to us by the general public and acknowledges all the concerns and interests. C oncerns raised during public comment have been addressed to the best of our ability . A fter careful consideration, APHI S has concluded that the provisions set forth in the rule will remain unchanged

. .6

Based on our review of availa ble information, APH IS does not expect the rule to have a significant economic impact on small entities. I n the absence of significant economic impacts, we have not identified alternatives that would minimize such impacts.