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[Federal Register Volume 76, Number 112 (Friday, June 10, 2011)]
[Rules and Regulations]
[Pages 33969-33970]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-14430]

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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 985

[Docket Nos. AMS-FV-09-0082; FV10-985-1A FIR]

Marketing Order Regulating the Handling of Spearmint Oil Produced 
in the Far West; Revision of the Salable Quantity and Allotment 
Percentage for Class 3 (Native) Spearmint Oil for the 2010-2011 
Marketing Year

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Affirmation of interim rule as final rule.

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SUMMARY: The Department of Agriculture (USDA) is adopting, as a final 
rule, without change, an interim rule that revised the quantity of 
Class 3 (Native) spearmint oil that handlers may purchase from, or 
handle on behalf of, producers during the 2010-2011 marketing year. The 
interim rule increased the Native spearmint oil salable quantity from 
980,220 pounds to 1,118,639 pounds, and the allotment percentage from 
43 percent to 50 percent. This change is expected to balance the supply 
of Native spearmint oil produced in the Far West with market needs and 
to promote market stability.

DATES: Effective June 13, 2011.

FOR FURTHER INFORMATION CONTACT: Barry Broadbent, Marketing Specialist 
or Gary Olson, Regional Manager, Northwest Marketing Field Office, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA; Telephone: (503) 326-2724, Fax: (503) 326-7440, or E-mail: 
Barry.Broadbent@ams.usda.gov or GaryD.Olson@ams.usda.gov.
    Small businesses may obtain information on complying with this and 
other marketing order regulations by viewing a guide at the following 
Web site: http://www.ams.usda.gov/MarketingOrdersSmallBusinessGuide; or 
by contacting Laurel May, 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: Laurel.May@ams.usda.gov.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing Order 
No. 985 (7 CFR part 985), as amended, regulating the handling of 
spearmint oil produced in the Far West (Washington, Idaho, Oregon, and 
designated parts of Nevada and Utah), 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.''
    USDA is issuing this rule in conformance with Executive Order 
12866.
    Salable quantities and allotment percentages for Scotch and Native 
spearmint oil for the 2010-2011 marketing year were established in a 
final rule published in the Federal Register on May 18, 2010 (75 FR 
27631). The rule set salable quantities of 566,962 pounds and 980,265 
pounds, and allotment percentages of 28 percent and 43 percent, 
respectively, for Scotch and Native spearmint oil. The salable 
quantities and allotment percentages were established prior to the 
start of the marketing year and were based on the Committee's 
projection of the supply and demand for spearmint oil for the 
forthcoming year.
    Early in the 2010-2011 marketing year, however, the spearmint 
industry reported to the Committee that the real demand for Native 
spearmint oil was greater than the level that was initially projected. 
The Committee subsequently recommended revising the salable quantity 
and allotment percentage for Native spearmint to allow the market to 
satisfy the increased demand.
    In an interim rule published in the Federal Register on January 25, 
2011, and effective June 1, 2010, through May 31, 2011, (76 FR 4204, 
Doc. No. AMS-FV-09-0082, FV10-985-1A IR), the salable quantity and 
allotment percentage for Class 3 (Native) spearmint oil for the 2010-
2011 marketing year was increased 138,419 pounds and 7 percent, 
respectively. The aforementioned rule contains an extensive discussion 
of the volume regulation process.
    This final rule continues in effect the action that revised the 
quantity of Native spearmint oil that handlers may purchase from, or 
handle on behalf of, producers during the 2010-2011 marketing year, 
which ends on May 31, 2011. Therefore, the Native spearmint oil salable 
quantity of 1,118,639 pounds and the allotment percentage of 50 percent 
remains in effect through the end of the 2010-2011 marketing year.

Final Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), 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.

[[Page 33970]]

    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 8 spearmint oil handlers subject to regulation under the 
order, and approximately 38 producers of Scotch spearmint oil and 
approximately 84 producers of Native spearmint oil in the regulated 
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.
    Based on the SBA's definition of small entities, the Committee 
estimates that two of the eight handlers regulated by the order could 
be considered small entities. Most of the handlers are large 
corporations involved in the international trading of essential oils 
and the products of essential oils. In addition, the Committee 
estimates that 19 of the 38 Scotch spearmint oil producers and 29 of 
the 84 Native spearmint oil producers could be classified as small 
entities under the SBA definition. Thus, a majority of handlers and 
producers of Far West spearmint oil may not be classified as small 
entities.
    The Far West spearmint oil industry is characterized by producers 
whose farming operations generally involve more than one commodity, and 
whose income from farming operations is not exclusively dependent on 
the production of spearmint oil. A typical spearmint oil-producing 
operation has enough acreage for rotation such that the total acreage 
required to produce the crop is about one-third spearmint and two-
thirds rotational crops. Thus, the typical spearmint oil producer has 
to have considerably more acreage than is planted to spearmint during 
any given season. Crop rotation is an essential cultural practice in 
the production of spearmint oil for weed, insect, and disease control. 
To remain economically viable with the added costs associated with 
spearmint oil production, most spearmint oil-producing farms fall into 
the SBA category of large businesses.
    Small spearmint oil producers generally are not as extensively 
diversified as larger ones and as such are more at risk to market 
fluctuations. Such small producers generally need to market their 
entire annual crop and do not have the luxury of having other crops to 
cushion seasons with poor spearmint oil returns. Conversely, large 
diversified producers have the potential to endure one or more seasons 
of poor spearmint oil markets because income from alternate crops could 
support the operation for a period of time. Being reasonably assured of 
a stable price and market provides small producing entities with the 
ability to maintain proper cash flow and to meet annual expenses. Thus, 
the market and price stability provided by the order potentially 
benefit the small producer more than such provisions benefit large 
producers. Even though a majority of handlers and producers of 
spearmint oil may not be classified as small entities, the volume 
control feature of this order has small entity orientation.
    This rule continues in effect the action that revised the quantity 
of Native spearmint oil that handlers may purchase from, or handle on 
behalf of, producers during the 2010-2011 marketing year, which ends on 
May 31, 2011. The Native spearmint oil salable quantity and allotment 
percentage is increased to 1,118,639 pounds and 50 percent, 
respectively, for the 2010-2011 marketing year.
    The use of volume control regulation allows the industry to fully 
supply spearmint oil markets while avoiding the negative consequences 
of over-supplying these markets. Volume control is believed to have 
little or no effect on consumer prices of products containing spearmint 
oil and likely does not result in fewer retail sales of such products. 
The marketing order's volume control provisions have been successfully 
implemented in the domestic spearmint oil industry for nearly three 
decades and provide benefits for producers, handlers, manufacturers, 
and consumers.
    This rule will not impose any additional reporting or recordkeeping 
requirements on either small or large spearmint oil 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. In addition, USDA 
has not identified any relevant Federal rules that duplicate, overlap 
or conflict with this rule.
    Further, the Committee's meeting was widely publicized throughout 
the spearmint industry and all interested persons were invited to 
attend the meeting and participate in Committee deliberations. Like all 
Committee meetings, the November 19, 2010, meeting was a public meeting 
and all entities, both large and small, were able to express their 
views on this issue.
    Comments on the interim rule were required to be received on or 
before March 28, 2011. No comments were received. Therefore, for the 
reasons given in the interim rule, we are adopting the interim rule as 
a final rule, without change. To view the interim rule, go to: http://www.regulations.gov/#!documentDetail;D=AMS-FV-09-0082-0002.
    This action also affirms information contained in the interim rule 
concerning Executive Orders 12866 and 12988, the Paperwork Reduction 
Act (44 U.S.C. Chapter 35), and the E-Gov Act (44 U.S.C. 101).
    After consideration of all relevant material presented, it is found 
that finalizing the interim rule, without change, as published in the 
Federal Register (76 FR 4204, January 25, 2011) will tend to effectuate 
the declared policy of the Act.

List of Subjects in 7 CFR Part 985

    Marketing agreements, Oils and fats, Reporting and recordkeeping 
requirements, Spearmint oil.

PART 985--[AMENDED]

0
Accordingly, the interim rule amending 7 CFR part 985 that was 
published at 76 FR 4204 on January 25, 2011, is adopted as a final 
rule, without change.

    [Note: The affected section of part 985 does not appear in the 
Code of Federal Regulations.]

    Dated: June 6, 2011.
Ellen King,
Acting Administrator,Agricultural Marketing Service.
[FR Doc. 2011-14430 Filed 6-9-11; 8:45 am]
BILLING CODE 3410-02-P
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