This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by

the Superintendent of Documents. Prices of

new books are listed in the first FEDERAL

REGISTER issue of each week.

Rules and Regulations Federal Register

28475

Vol. 63, No. 100

Tuesday, May 26, 1998

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 925 and 944

[Docket No. FV98–925–3 IFR]

Grapes Grown in a Designated Area of

Southeastern California and Imported

Table Grapes; Revision in Minimum

Grade, Container, and Pack

Requirements

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Interim final rule with request

for comments.

SUMMARY: This rule revises minimum

grade requirements for grapes grown in

southeastern California and for grapes

imported into the United States. It also

revises container and pack requirements

currently prescribed for California

grapes. This rule allows California grape

handlers to market consumer packages

of grapes more economically by

increasing the range of allowable bunch

sizes for a portion of the 1998 season.

Master containers of consumer grape

packages could be marketed if the grape

clusters/bunches in the packages consist

of at least 2 berry clusters and the

clusters/bunches are not greater than 19

ounces in weight. The increased bunch

size range also applies to imported

grapes. This action is in the interest of

handlers, producers, importers, and

consumers.

DATES: Effective June 1, 1998; comments

must be received by June 25, 1998 and

will be considered prior to issuance of

a final rule.

ADDRESSES: Interested persons are

invited to submit written comments

concerning this rule. Comments must be

sent to the Docket Clerk, Fruit and

Vegetable Programs, AMS, USDA, room

2525–S, P.O. Box 96456, Washington,

DC 20090–6456; Fax: (202) 205–6632.

All comments should reference the

docket number and the date and page

number of this issue of the Federal

Register and will be available for public

inspection in the Office of the Docket

Clerk during regular business hours.

FOR FURTHER INFORMATION CONTACT: Rose

M. Aguayo, Marketing Specialist,

California Marketing Field Office,

Marketing Order Administration

Branch, F&V, AMS, USDA, 2202

Monterey Street, suite 102B, Fresno,

California 93721; telephone: (209) 487–

5901, Fax: (209) 487–5906; or Anne M.

Dec, Team Leader, Marketing Order

Administration Branch, F&V, AMS,

USDA, room 2525–S, P.O. Box 96456,

Washington, DC 20090–6456; telephone:

(202) 720–2491, Fax: (202) 205–6632.

Small businesses may request

information on compliance with this

regulation by contacting Jay Guerber,

Marketing Order Administration

Branch, F&V, AMS, USDA, room 2525–

S, P.O. Box 96456, Washington, DC

20090–6456; telephone: (202) 720–2491,

Fax: (202) 205–6632.

SUPPLEMENTARY INFORMATION: This rule

is issued under Marketing Order No.

925 (7 CFR Part 925), regulating the

handling of grapes grown in a

designated area of southeastern

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.’’

This rule is also issued under section

8e of the Act, which provides that

whenever certain specified

commodities, including table grapes, are

regulated under a Federal marketing

order, imports of these commodities

into the United States are prohibited

unless they meet the same or

comparable grade, size, quality, or

maturity requirements as those in effect

for the domestically produced

commodities.

The Department of Agriculture

(Department) is issuing this rule in

conformance with Executive Order

12866.

This rule has been reviewed under

Executive Order 12988, Civil Justice

Reform. This rule is not intended to

have retroactive effect. This rule will

not preempt any State or local laws,

regulations, or policies, unless they

present an irreconcilable conflict with

this rule.

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 the Secretary 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 the Secretary 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 the Secretary’s ruling on the

petition, provided an action is filed not

later than 20 days after date of the entry

of the ruling.

There are no administrative

procedures which must be exhausted

prior to any judicial challenge to the

provisions of import regulations issued

under section 8e of the Act.

This rule increases the range of

allowable sizes of grape bunches that

California handlers can pack in certain

containers during the period June 1,

1998, through August 15, 1998. Master

containers of consumer grape packages

can be marketed if the grape clusters/

bunches in the packages consist of at

least 2 berry clusters and the clusters/

bunches are not greater than 19 ounces

in weight. The increased bunch size

range also applies to imported grapes,

but no container specifications apply.

The changes in domestic requirements

were recommended by the California

Desert Grape Administrative Committee

(Committee), the agency responsible for

local administration of the order.

Under the terms of the order, fresh

market shipments of grapes grown in

southeastern California are required to

be inspected and meet grade, size,

maturity, pack, and container

requirements. Current requirements

include minimum grade and net weight

requirements. Grapes must also be

packed in authorized containers, and

such containers must be marked with

the minimum net weight of the grapes

contained therein, the variety of the

grapes, the name of the shipper, and the

lot stamp number corresponding to the

lot inspection conducted by an

authorized inspector.

Section 925.52(a)(2) of the grape order

provides authority to limit the handling
28476 Federal Register / Vol. 63, No. 100 /Tuesday, May 26, 1998 /Rules and Regulations

of any grade, size, quality, maturity, or

pack of grapes for different varieties, or

any combination of the foregoing during

any period or periods.

Section 925.304(a) of the order’s

administrative rules and regulations

requires grapes to meet the minimum

grade requirements of U.S. No. 1 Table,

or U.S. No. 1 Institutional, or to meet all

the requirements of U.S. No. 1

Institutional, except that a tolerance of

33 percent is provided for off-size

bunches. Grapes meeting U.S. No. 1

Institutional requirements are required

to be marked ‘‘U.S. No. 1 Institutional.’’

Grapes meeting the modified U.S. No. 1

Institutional requirements may be

marked ‘‘DGAC No. 1 Institutional.’’

The requirements for the U.S. No. 1

Table and U.S. No. 1 Institutional grades

are set forth in the United States

Standards for Grades of Table Grapes

(European or Vinifera Type) (7 CFR

51.880 through 51.914) (Standards).

Section 925.52(a)(4) of the order

provides authority to regulate the size,

capacity, weight, dimensions, markings,

materials, and pack of containers which

may be used in the handling of grapes.

Section 925.304(b)(1) of the order’s

administrative rules and regulations

requires grapes to be packed in new and

clean boxes which meet the

requirements of sections 1380.14,

1380.19, 1436.37, and 1436.38 of Title 3:

California Code of Regulations (CCR).

That section also authorizes nine

containers that can be used for domestic

and export shipments and specifies

dimensions for each such container. An

additional container, defined in terms of

a net weight of 5 kilograms, is

authorized for export shipments only.

All 10 of the authorized containers may

be used for export shipments. Only the

first nine can be used for domestic

shipments.

Finally, § 925.304(b)(1) authorizes the

Committee to approve other containers

for experimental or research purposes.

Section 925.304(b)(2) of the order’s

administrative rules and regulations

provides that grapes in any containers

weigh at least 20 pounds based on the

average net weight of grapes in a

representative sample of containers. An

exception is provided for grapes packed

in experimental containers, or packed in

bags or wrapped in plastic or paper.

Containers of grapes packed in bags or

wrapped in plastic or paper prior to

being placed in these containers must

meet a minimum net weight

requirement of 18 pounds. There are no

weight requirements specified for

experimental containers.

The Committee met on March 24,

1998, and unanimously recommended

modifying § 925.304 of the order’s

administrative rules and regulations to

make the following changes:

(1) Revise the minimum grade

requirement for the period June 1, 1998,

through August 15, 1998, to allow a

pilot test for the marketing of grapes

which meet all the requirements of U.S.

No. 1 Institutional except for the weight

of clusters/bunches. The revision allows

clusters/bunches as small as a 2 berry

cluster and as large as 19 ounces in

weight. Grapes meeting these quality

requirements are to be marked ‘‘DGAC

Consumer No. 1 Institutional’’ but

cannot be marked ‘‘Institutional Pack.’’

(2) Authorize an experimental master

container, containing individual

consumer packages of grapes which

weigh 11⁄2 pounds or less, net weight,

for use during the pilot test period of

June 1, 1998, to August 15, 1998. Grapes

meeting the ‘‘DGAC Consumer No. 1

Institutional’’ requirements must be

packed in this container and this master

container can only be used for packing

the ‘‘DGAC Consumer No. 1

Institutional’’ grade.

(3) Update or remove certain obsolete

references appearing in the regulation.

Revision in Minimum Grade

Requirements

Until 1993, the minimum grade

requirement under the order was U.S.

No. 1 Table. One requirement of that

grade is that grape bunches weigh at

least 4 ounces.

In 1991, a new U.S. No. 1 Institutional

grade was added to the Standards. This

grade—used primarily for sales to

restaurants and other food service

firms—provides for grape lots which

have very small bunches. At the request

of the table grape industry, this grade

was added to meet market demand for

individual consumer sized servings of

grapes. The Standards were further

revised in 1996 to lower the minimum

bunch size to a two berry cluster and

specify a separate 4 percent tolerance

for off-size bunches.

The minimum grade requirements

under the order were changed in 1993

to allow California grape handlers to

pack the newly established U.S. No. 1

Institutional grade. Because handlers

experienced difficulties in packing this

grade, these requirements were further

revised in 1994 to provide a tolerance of

33 percent for off-size bunches. This

modified U.S. No. 1 Institutional grade

is referred to as DGAC No. 1

Institutional.

Currently, during the period April 20

through August 15 each year, California

grape handlers can ship grapes meeting

at least U.S. No. 1 Table, U.S. No. 1

Institutional, or DGAC No. 1

Institutional.

The requirements of the U.S. No. 1

Institutional are essentially the same as

those of the U.S. No. 1 Table grade, with

three major exceptions. The first

difference relates to bunch size. Under

the U.S. No. 1 Table grade, there is a

minimum bunch size requirement of 4

ounces and no maximum bunch size.

Under the U.S. No. 1 Institutional grade,

grapes are to consist of at least a two

berry cluster ranging to clusters and/or

bunches of grapes not greater than five

ounces in weight. A cluster is two or

more berries sharing a common point of

attachment.

The second difference is that at least

95 percent of the containers in a lot of

grapes grading U.S. No. 1 Institutional

must be legibly marked ‘‘Institutional

Pack.’’ There are no marking

requirements under the U.S. No. 1 Table

grade.

The third difference relates to the

tolerances for off-size bunches. For

grapes grading U.S. No. 1 Table, an 8

percent tolerance is established for all

grade requirements, including off-size

bunches. The U.S. No. 1 Institutional

grade has a separate tolerance of 4

percent for off-size clusters/bunches and

an 8 percent tolerance for the remaining

grade requirements.

Requirements for the DGAC No. 1

Institutional are the same as for the U.S.

No. 1 Institutional, except that the

tolerance for off-size bunches is 33

percent. Because grapes meeting these

requirements do not meet the U.S. No.

1 Institutional grade requirements, they

cannot be marked ‘‘Institutional Pack.’’

They may, however, be marked ‘‘DGAC

No. 1 Institutional.’’

Recently, there has been interest in

packing grapes in individual consumer

packages known as ‘‘punits’’ or

‘‘clamshells.’’ These containers, used

most commonly to pack strawberries,

are made of a clear, hard rigid plastic

and typically hold a half pound or a

pound of fruit. Some retailers prefer

these containers because they are of the

same net weight, and can be scanned at

check-out. This is particularly

convenient for retailers that do not have

facilities for weighing produce, such as

convenience stores and fast food outlets.

Some consumers also prefer the

convenience of prepackaged individual

portions of fruit.

To meet changing market

requirements, California grape handlers

would like to be able to pack these

consumer packages. Current bunch size

requirements make it difficult however.

Grape bunches normally range in weight

from 1⁄4 pound to 3 pounds. Thus,

portions of bunches have to be used to

fill the new packages to the weights

desired by buyers. Handlers have
Federal Register / Vol. 63, No. 100 /Tuesday, May 26, 1998 /Rules and Regulations 28477

determined that increasing the range of

permissible bunch sizes to allow for

clusters/bunches of two berries to 19

ounces will provide handlers the

flexibility needed to pack grapes in the

desired consumer containers.

This rule revises § 925.304(a) of the

order’s rules and regulations to allow

handlers to ship a new grade of grapes

to be known as DGAC Consumer No. 1

Institutional. The name recognizes that

such grapes will be packed in consumer

packages and that the grapes are not

packed to the minimum requirements of

the U.S. No. 1 Table grade. Grapes

meeting this requirement must meet the

requirements of the U.S. No. 1

Institutional grade, except for the

cluster/bunch size requirements.

Specifically, these modified

requirements allow shipments with

clusters/bunches ranging from 2 berry

clusters to clusters/bunches of grapes up

to 19 ounces in weight.

Container Requirements

The Committee recommended that

grapes packed in accordance with the

new DGAC Consumer No. 1

Institutional requirements be packed in

a certain way. These grapes must be

packed in individual consumer

packages. The consumer packages must

then be packed in a master container.

Typically, the individual consumer

packages hold either 1⁄2 or 1 pound of

fruit. To allow for normal shrinkage

during handling, handlers generally

pack a slightly greater weight than is

desired at retail. Section 925.304(b) is

revised to provide that DGAC Consumer

No. 1 Institutional grade grapes be

packed in master containers containing

individual consumer packages weighing

11⁄2 pounds or less.

Additionally, these master containers

are required to be marked ‘‘DGAC

Consumer No. 1 Institutional’’ to

accurately reflect their contents. The

individual consumer packages do not

need to be so marked. Other container

marking requirements appearing in the

regulation apply to the master

containers as well.

The master containers used for these

grapes will typically hold 10 consumer

packages weighing 1 pound each or 20

packages weighing 1⁄2 pound each.

Thus, these containers are exempt from

the net weight requirements of 18 or 20

pounds specified in § 925.304(b)(2).

Application to Imports

Section 8e of the Act specifies that

whenever certain commodities, like

grapes, are regulated under a Federal

order, imports of those commodities

must meet the same or comparable

grade, size, quality, and maturity

requirements as those in effect for the

domestically produced commodity.

Pack and container requirements are not

authorized by section 8e. Thus, the

revised grade requirements

implemented by this rule apply to

imported grapes; none of the container

or container marking requirements

apply, however. If desired, importers

may label containers of grapes meeting

the modified U.S. No. 1 Institutional

requirements as ‘‘DGAC Consumer No.

1 Institutional.’’ Specifically, this rule

modifies language in § 944.503(a)(1) of

the Table Grape Import Regulation 4 for

fresh grapes imported into the United

States.

Clarification/Removal of Obsolete

Language

This rule removes language in the

introductory text of § 925.304 by

removing a proviso that applies to the

1987 season and is no longer necessary.

This rule makes several other

corrections in both the order’s

administrative rules and regulations and

the import regulation. Specifically, the

tolerance percentage of ‘‘8 percent’’ is

changed to ‘‘4 percent’’ in §§ 925.304(a)

of the order’s administrative rules and

regulations and in 944.503(a)(1) of the

import regulation. This corrects those

sections to accurately specify the

current tolerance for off-size bunches in

the U.S. No. 1 Institutional grade. This

rule corrects a reference to the

Standards from section number

‘‘51.913’’ to section number ‘‘51.914’’ in

§§ 925.304(a) of the order and in

944.503(a)(1) of the import regulation;

and changes a California Department of

Food and Agriculture reference from

‘‘California Administrative Code (Title

3)’’ to ‘‘Title 3: California Code of

Regulations’’ in paragraph (a)(1)(ii) of

§ 944.503 of the import regulation.

Initial Regulatory Flexibility Analysis

Pursuant to requirements set forth in

the Regulatory Flexibility Act (RFA), the

Administrator of the Agricultural

Marketing Service (AMS) has

considered the economic impact of this

rule on small entities. Accordingly,

AMS has prepared this initial 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 rules issued thereunder, are

unique in that they are brought about

through group action of essentially

small entities acting on their own

behalf. Thus, both statutes have small

entity orientation and compatibility.

Import regulations issued under the Act

are based on those established under

Federal marketing orders.

There are approximately 27 handlers

of California grapes who are subject to

regulation under the order and

approximately 80 grape producers in the

production area. In addition, there are

approximately 127 importers of grapes.

Small agricultural service firms have

been defined by the Small Business

Administration (13 CFR 121.601) as

those having annual receipts of less than

$5,000,000, and small agricultural

producers have been defined as those

having annual receipts of less than

$500,000. Ten of the 27 handlers subject

to regulation have annual grape sales of

at least $5,000,000, excluding receipts

from any other sources. In addition, 70

of the 80 producers subject to regulation

have annual sales of at least $500,000,

and the remaining 10 producers have

annual sales less than $500,000,

excluding receipts from any other

sources. Therefore, a majority of

handlers and a minority of producers

are classified as small entities. The

average importer receives $2.8 million

in grape revenue, excluding receipts

from other sources. Therefore, we

believe that the majority of these

importers are small entities.

This rule increases the range of

allowable sizes of grape bunches that

California handlers can pack in certain

containers during the period June 1,

1998, through August 15, 1998. Master

containers of consumer grape packages

can be marketed if the grape clusters/

bunches in the packages consist of at

least 2 berry clusters and the clusters/

bunches are not greater than 19 ounces

in weight. The increased bunch size

range also applies to imported grapes,

but no container specifications apply.

The changes in domestic requirements

were recommended by the California

Desert Grape Administrative Committee

(Committee), the agency responsible for

local administration of the order.

Under the terms of the order, fresh

market shipments of grapes grown in

southeastern California are required to

be inspected and meet grade, size,

maturity, pack, and container

requirements. Current requirements

include minimum grade and net weight

requirements. Grapes must also be

packed in authorized containers, and

such containers must be marked with

the minimum net weight of the grapes

contained therein, the variety of the

grapes, the name of the shipper, and the

lot stamp number corresponding to the

lot inspection conducted by an

authorized inspector.

Section 925.52(a)(2) of the grape order

provides authority to limit the handling
28478 Federal Register / Vol. 63, No. 100 /Tuesday, May 26, 1998 /Rules and Regulations

of any grade, size, quality, maturity, or

pack of grapes for different varieties, or

any combination of the foregoing during

any period or periods.

Section 925.304(a) of the order’s

administrative rules and regulations

requires grapes to meet the minimum

grade requirements of U.S. No. 1 Table,

or U. S. No. 1 Institutional, or to meet

all the requirements of U.S. No. 1

Institutional, except that a tolerance of

33 percent is provided for off-size

bunches. Grapes meeting U.S. No. 1

Institutional requirements are required

to be marked ‘‘U.S. No. 1 Institutional.’’

Grapes meeting the modified U.S. No. 1

Institutional requirements may be

marked ‘‘DGAC No. 1 Institutional.’’

The requirements for the U.S. No. 1

Table and U.S. No. 1 Institutional grades

are set forth in the United States

Standards for Grades of Table Grapes

(European or Vinifera Type) (7 CFR

51.880 through 51.914) (Standards).

Section 925.52(a)(4) of the order

provides authority to regulate the size,

capacity, weight, dimensions, markings,

materials, and pack of containers which

may be used in the handling of grapes.

Section 925.304(b)(1) of the order’s

administrative rules and regulations

requires grapes to be packed in new and

clean boxes which meet the

requirements of sections 1380.14,

1380.19, 1436.37, and 1436.38 of Title 3:

California Code of Regulations (CCR).

That section also authorizes nine

containers that can be used for domestic

and export shipments, and specifies

dimensions for each such container. An

additional container, defined in terms of

a net weight of 5 kilograms, is

authorized for export shipments only.

All 10 authorized containers may be

used for export shipments. Only the first

nine can be used for domestic

shipments.

Finally, § 925.304(b)(1) authorizes the

Committee to approve other containers

for experimental or research purposes.

Section 925.304(b)(2) of the order’s

administrative rules and regulations

provides that grapes in any containers

weigh at least 20 pounds based on the

average net weight of grapes in a

representative sample of containers. An

exception is provided for grapes packed

in experimental containers, or packed in

bags or wrapped in plastic or paper.

Containers of grapes packed in bags or

wrapped in plastic or paper prior to

being placed in these containers must

meet a minimum net weight

requirement of 18 pounds.

There are no weight requirements

specified for experimental containers.

The Committee met on March 24,

1998, and unanimously recommended

modifying § 925.304 of the order’s

administrative rules and regulations to

make the following changes:

(1) Revise the minimum grade

requirement for the period June 1, 1998,

through August 15, 1998, to allow a

pilot test for the marketing of grapes

which meet all the requirements of U.S.

No. 1 Institutional except for the weight

of clusters/bunches. The revision allows

clusters/bunches as small as a 2 berry

cluster and as large as 19 ounces in

weight. Grapes meeting these quality

requirements are to be marked ‘‘DGAC

Consumer No. 1 Institutional’’ but

cannot be marked ‘‘Institutional Pack.’’

(2) Authorize an experimental master

container, containing individual

consumer packages of grapes which

weigh 11⁄2 pounds or less, net weight,

for use during the pilot test period of

June 1, 1998, to August 15, 1998. Grapes

meeting the ‘‘DGAC Consumer No. 1

Institutional’’ requirements must be

packed in this container and this master

container can only be used for packing

the ‘‘DGAC Consumer No. 1

Institutional’’ grade.

Currently, during the period April 20

through August 15 each year, California

grape handlers can ship grapes meeting

at least U.S. No. 1 Table, U.S. No. 1

Institutional, or DGAC No. 1

Institutional.

The requirements of the U.S. No. 1

Institutional are essentially the same as

those of the U.S. No. 1 Table grade, with

three major exceptions. The first

difference relates to bunch size. Under

the U.S. No. 1 Table grade, there is a

minimum bunch size requirement of 4

ounces and no maximum bunch size.

Under the U.S. No. 1 Institutional grade,

grapes are to consist of at least a two

berry cluster ranging to clusters and/or

bunches of grapes not greater than five

ounces in weight. A cluster is two or

more berries sharing a common point of

attachment.

The second difference is that at least

95 percent of the containers in a lot of

grapes grading U.S. No. 1 Institutional

must be legibly marked ‘‘Institutional

Pack.’’ There are no marking

requirements under the U.S. No. 1 Table

grade.

The third difference relates to the

tolerances for off-size bunches. For

grapes grading U.S. No. 1 Table, an 8

percent tolerance is established for all

grade requirements, including off-size

bunches. The U.S. No. 1 Institutional

grade has a separate tolerance of 4

percent for off-size clusters/bunches and

an 8 percent tolerance for the remaining

grade requirements.

Requirements for the DGAC No. 1

Institutional are the same as for the U.S.

No. 1 Institutional, except that the

tolerance for off-size bunches is 33

percent. Because grapes meeting these

requirements do not meet the U.S. No.

1 Institutional grade requirements, they

cannot be marked ‘‘Institutional Pack.’’

They may, however, be marked ‘‘DGAC

No. 1 Institutional.’’

Recently, there has been interest in

packing grapes in individual consumer

packages known as ‘‘punits’’ or

‘‘clamshells.’’ These containers, used

most commonly to pack strawberries,

are made of a clear, hard rigid plastic

and typically hold a half pound or a

pound of fruit. Some retailers prefer

these containers because they are of the

same net weight, and can be scanned at

check-out. This is particularly

convenient for retailers that do not have

facilities for weighing produce, such as

convenience stores and fast food outlets.

Some consumers also prefer the

convenience of prepackaged individual

portions of fruit.

To meet changing market

requirements, California grape handlers

would like to be able to pack these

consumer packages. Current bunch size

requirements make it difficult however.

Grape bunches normally range in weight

from 1/4 pound to 3 pounds. Thus,

portions of bunches have to be used to

fill the new packages to the weights

desired by buyers. Handlers have

determined that increasing the range of

permissible bunch sizes to allow for

clusters/bunches of two berries to 19

ounces will provide handlers the

flexibility needed to pack grapes in the

desired consumer containers.

This rule revises § 925.304(a) of the

order’s rules and regulations to allow

handlers to ship a new grade of grapes

to be known as DGAC Consumer No. 1

Institutional. The name recognizes that

such grapes will be packed in consumer

packages and that the grapes are not

packed to the minimum requirements of

the U.S. No. 1 Table grade. Grapes

meeting this requirement must meet the

requirements of the U.S. No. 1

Institutional grade, except for the

cluster/bunch size requirements.

Specifically, these modified

requirements allow shipments with

clusters/bunches ranging from 2 berry

clusters to clusters/bunches of grapes up

to 19 ounces in weight.

The Committee recommended that

grapes packed in accordance with the

new DGAC Consumer No. 1

Institutional requirements be packed in

a certain way. These grapes must be

packed in individual consumer

packages. The consumer packages must

then be packed in a master container.

Typically, the individual consumer

packages hold either 1⁄2 or 1 pound of

fruit. To allow for normal shrinkage

during handling, handlers generally
Federal Register / Vol. 63, No. 100 /Tuesday, May 26, 1998 /Rules and Regulations 28479

pack a slightly greater weight than is

desired at retail. Section 925.304(b) is

revised to provide that DGAC Consumer

No. 1 Institutional grade grapes be

packed in master containers containing

individual consumer packages weighing

11⁄2 pounds or less.

Additionally, these master containers

are required to be marked ‘‘DGAC

Consumer No. 1 Institutional’’ to

accurately reflect their contents. The

individual consumer packages do not

need to be so marked. Other container

marking requirements appearing in the

regulation apply to the master

containers as well.

The master containers used for these

grapes will typically hold 10 consumer

packages weighing 1 pound each or 20

packages weighing 1⁄2 pound each.

Thus, these containers are exempt from

the net weight requirements of 18 or 20

pounds specified in § 925.304(b)(2).

Section 8e of the Act specifies that

whenever certain commodities, like

grapes, are regulated under a Federal

order, imports of those commodities

must meet the same or comparable

grade, size, quality, and maturity

requirements as those in effect for the

domestically produced commodity.

Pack and container requirements are not

authorized by section 8e. Thus, the

revised grade requirements

implemented by this rule apply to

imported grapes; none of the container

or container marking requirements

apply, however. If desired, importers

may label containers of grapes meeting

the modified U.S. No. 1 Institutional

requirements as ‘‘DGAC Consumer No.

1 Institutional.’’ Specifically, this rule

modifies language in § 944.503(a)(1) of

the Table Grape Import Regulation 4 for

fresh grapes imported into the United

States.

This regulation provides handlers and

importers more marketing flexibility, is

estimated to result in increased

shipments of consumer-sized grape

packs, and is expected to have positive

impact on California grape handlers and

importers of grapes. The changes

address the marketing and shipping

needs of the grape industry, and are in

the interest of handlers, producers,

importers, and consumers.

During the last several seasons,

Mexico has been the largest exporter of

grapes to the United States during the

June 1 through August 15 period. Chile

and Italy have exported small quantities

of grapes to the U.S. during this same

period. Chile is the dominant exporting

country from December through May

each year.

During the pilot test period of June 1,

1998, through August 15, 1998, imports

are estimated to total 5.5 million lugs

from Mexico, 33 thousand lugs from

Chile, and approximately 4 thousand

lugs from Italy. These estimates are

based upon lug weights of 18 pounds.

According to Department inspection

officials, minimal quantities of grapes

meeting the institutional grades have

been imported since the ‘‘Institutional

Pack’’ was implemented. Based on

historical data, it is estimated that

approximately .5 percent to 1 percent of

the imported lugs will meet the

requirements of either the ‘‘U.S. No. 1

Institutional’’ or the ‘‘DGAC No. 1

Institutional’’ grades. It is further

estimated that less than 1 percent of the

imported lugs will meet the

requirements of the ‘‘DGAC Consumer

No. 1 Institutional’’ grade. The majority

of imported grapes meet the higher

grade requirements of U.S. No. 1 Table,

U.S. Fancy Table, or U.S. Extra Fancy

Table.

The Committee estimates the 1998

domestic crop will be approximately 8

million lugs. Domestic handlers in

southeastern California, regulated under

the order, are expected to ship

approximately 6.2 million lugs during

the test period. It is estimated that

approximately .5 percent (31,000 lugs)

to 1 percent (62,000 lugs) of the crop

will be packed as U.S. No. 1

Institutional or DGAC No. 1

Institutional and that less than 1 percent

(62,000 lugs) of the crop will be packed

as ‘‘DGAC Consumer No. 1

Institutional’’ during the test period.

The estimates for the DGAC Consumer

No. 1 Institutional are based upon a lug

weight of 10 pounds. The Committee

estimated that handlers will receive

approximately $0.60 to $1.00 per pound

for a total estimated value of $372,000

to $620,000 for this new individual

consumer pack. Handlers will receive

approximately $0.10 more for the new

consumer packages than for bagged

grapes. Consumers will benefit by being

able to purchase grapes in preferred

containers.

The Committee requested that this

rule be effective by June 1, 1998. The

California grape shipping season is

expected to begin shortly, and continue

until August 15, 1998. Therefore, an

effective date of June 1 will allow

handlers and importers approximately

10 weeks to test the market.

At the meeting, the Committee

discussed the potential impact of this

rule and determined that this action will

not require any changes in grape

handling practices. Those who choose

to pack to this new grade could achieve

additional sales which will be a benefit

to the grape industry as a whole.

The benefits of this rule are not

expected to be disproportionately

greater or smaller for small handlers or

producers than for larger entities.

The Committee discussed alternatives

to this revision, including not having a

pilot test, but determined that handlers,

producers, importers and consumers

should benefit from this pilot test.

The Committee also discussed adding

a percentage tolerance for off-size

bunches of 33 percent similar to the

additional percentage tolerance allowed

for the DGAC No. 1 Institutional grade,

but determined that the 4 percent

tolerance, as contained in the Standards,

was adequate to facilitate packaging of

the ‘‘punits’’ or ‘‘clamshells’’.

This action will not impose any

additional reporting or recordkeeping

requirements on either small or large

grape handlers or importers. 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, the Department 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 grape

industry and all interested persons were

invited to attend the meeting and

participate in Committee deliberations

on all issues. Like all Committee

meetings, the March 24, 1998, meeting

was a public meeting and all entities,

both large and small, were able to

express their views on this issue. The

Committee itself is composed of 12

members: 8 are handlers and producers,

1 is a producer only, and 2 are handlers

only. The twelfth Committee member is

the public member. In addition, the

embassies of Mexico, Chile, and Italy

were notified of the anticipated action.

Finally, interested persons are invited to

submit information on the regulatory

and informational impacts of this action

on small businesses.

After consideration of all relevant

material presented, including the

Committee’s recommendation, and

other available information, it is found

that this interim final 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, upon good

cause, that it is impracticable,

unnecessary and contrary to the public

interest to give preliminary notice prior

to putting this rule into effect, and that

good cause exists for not postponing the

effective date of this rule until 30 days

after publication in the Federal Register

because: (1) This action revises

minimum grade requirements currently

in effect for grapes grown in designated
28480 Federal Register / Vol. 63, No. 100 /Tuesday, May 26, 1998 /Rules and Regulations

areas of southeastern California and for

grapes imported into the United States

and offers handlers and importers more

marketing flexibility; (2) California

grape handlers are aware of this action

which was unanimously recommended

by the Committee at a public meeting.

In addition, the embassies of Mexico,

Chile, and Italy were notified of the

anticipated action; (3) no changes in

packing procedures are required by this

rule for either California handlers or

importers, and they will need no

additional time to comply with the

revised requirements; (4) California

grape shipments are expected to begin

soon, and this rule needs to be in effect

by June 1, 1998, so handlers can test

market acceptance for the remainder of

the season; and (5) this rule provides a

30-day comment period and any

comments received will be considered

prior to finalization of this rule. For the

same reasons, a 30-day comment period

is deemed appropriate to provide for

comments from interested persons.

Further, the end of the 1998 season is

August 15.

In accordance with section 8e of the

Act, the United States Trade

Representative has concurred with the

issuance of this rule.

List of Subjects

7 CFR Part 925

Grapes, Marketing agreements,

Reporting and recordkeeping

requirements.

7 CFR Part 944

Avocados, Food grades and standards,

Grapefruit, Grapes, Imports, Kiwifruit,

Limes, Olives, Oranges.

For the reasons set forth in the

preamble, 7 CFR parts 925 and 944 are

amended as follows:

1. The authority citation for 7 CFR

parts 925 and 944 continues to read as

follows:

Authority: 7 U.S.C. 601–674.

PART 925—GRAPES GROWN IN A

DESIGNATED AREA OF

SOUTHEASTERN CALIFORNIA

2. Section 925.304 is amended by

revising the introductory text, paragraph

(a) introductory text, paragraph

(b)(1)(iii) and the first sentence of

paragraph (b)(2) to read as follows:

§ 925.304 California Desert Grape

Regulation 6.

During the period April 20 through

August 15 each year, no person shall

pack or repack any variety of grapes

except Emperor, Almeria, Calmeria, and

Ribier varieties, on any Saturday,

Sunday, Memorial Day, or the observed

Independence Day holiday, unless

approved in accordance with paragraph

(e) of this section, nor handle any

variety of grapes except Emperor,

Calmeria, Almeria, and Ribier varieties,

unless such grapes meet the

requirements specified in this section.

(a) Grade, size, and maturity. Except

as provided in paragraphs (a)(1) and

(a)(2) of this section, such grapes shall

meet the minimum grade and size

requirements of U.S. No. 1 Table, as set

forth in the United States Standards for

Grades of Table Grapes (European or

Vinifera Type 7 CFR 51.880 through

51.914), or shall meet all the

requirements of U.S. No. 1 Institutional

with the exception of the tolerance

percentage for bunch size. Such

tolerance shall be 33 percent instead of

4 percent as is required to meet U.S. No.

1 Institutional grade. Grapes meeting

these quality requirements may be

marked ‘‘DGAC No. 1 Institutional’’ but

shall not be marked ‘‘Institutional

Pack.’’ In addition, during the period

June 1, 1998, through August 15, 1998,

grapes may be handled that meet all the

requirements of U.S. No. 1 Institutional,

except that clusters/bunches must

consist of at least a 2 berry cluster

ranging to clusters and/or bunches of

grapes not greater than 19 ounces in

weight. Such grapes must be marked

‘‘DGAC Consumer No. 1 Institutional’’

and meet the container requirements in

paragraph (b)(1)(iii) of this section.

* * * * *

(b) * * *

(1) * * *

(iii) Such other types and sizes of

containers as may be approved by the

Committee for experimental or research

purposes: Provided, That for the period

June 1, 1998, through August 15, 1998,

master containers may be used if they

are packed with individual consumer

packs of grapes that weigh 11⁄2 pounds

or less, net weight, and meet the

requirements of the ‘‘DGAC Consumer

No. 1 Institutional.’’ Provided further,

That grapes meeting the requirements of

‘‘DGAC Consumer No. 1 Institutional’’

shall be packed only in this container,

and this master container shall be

marked ‘‘DGAC Consumer No. 1

Institutional.’’

(2) The minimum net weight of grapes

in any such containers, except for

containers containing grapes packed in

sawdust, cork, excelsior or similar

packing material, or packed in bags or

wrapped in plastic or paper, and

containers authorized in paragraph

(b)(1)(iii) of this section, shall be 20

pounds based on the average net weight

of grapes in a representative sample of

containers. * * *

* * * * *

PART 944—FRUITS; IMPORT

REQUIREMENTS

3. In § 944.503, paragraphs (a)(1)

introductory text and (a)(1)(ii) are

revised to read as follows:

§ 944.503 Table Grape Import Regulation

4.

(a)(1) Pursuant to section 8e of the Act

and Part 944—Fruits, Import

Regulations, the importation into the

United States of any variety of Vinifera

species table grapes, except Emperor,

Calmeria, Almeria, and Ribier varieties,

is prohibited unless such grapes meet

the minimum grade and size

requirements specified in 7 CFR 51.884

for U.S. No. 1 Table, as set forth in the

United States Standards for Grades of

Table Grapes (European or Vinifera

Type, 7 CFR 51.880 through 51.914), or

shall meet all the requirements of U.S.

No. 1 Institutional with the exception of

the tolerance for bunch size. Such

tolerance shall be 33 percent instead of

4 percent as is required to meet U.S. No.

1 Institutional grade. Grapes meeting

these quality requirements shall not be

marked ‘‘Institutional Pack’’, but may be

marked ‘‘DGAC No. 1 Institutional.’’ In

addition, during the period June 1,

1998, through August 15, 1998, grapes

may be imported if they meet all the

requirements of U.S. No. 1 Institutional,

except that clusters/bunches must

consist of at least a 2 berry cluster

ranging to clusters and/or bunches of

grapes not greater than 19 ounces (0.532

kilograms) in weight. Such grapes may

be marked ‘‘DGAC Consumer No. 1

Institutional’’ but shall not be marked

‘‘Institutional Pack.’’

* * * * *

(ii) Grapes of the Flame Seedless

variety shall meet the minimum berry

size requirement of ten-sixteenths of an

inch (1.5875 centimeters) and shall be

considered mature if the juice contains

not less than 15 percent soluble solids

and the soluble solids are equal to or in

excess of 20 parts to every part acid

contained in the juice in accordance

with applicable sampling and testing

procedures specified in sections 1463.3,

1436.5, 1436.6, 1436.7, 1436.12, and

1436.17 of Article 25 of Title 3:

California Code of Regulations (CCR).

* * * * *

Dated: May 19, 1998.

Robert C. Keeny,

Deputy Administrator, Fruit and Vegetable

Programs.

[FR Doc. 98–13881 Filed 5–22–98; 8:45 am]

BILLING CODE 3410–02–P