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[Federal Register Volume 75, Number 141 (Friday, July 23, 2010)]
[Rules and Regulations]
[Pages 43045-43049]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-18089]

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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 983

[Doc. No. AMS-FV-10-0031; FV10-983-1 IR]

Pistachios Grown in California, Arizona, and New Mexico; 
Modification of the Aflatoxin Regulations

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim rule with request for comments.

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SUMMARY: This rule modifies the aflatoxin sampling and testing 
regulations currently prescribed under the California, Arizona, and New

[[Page 43046]]

Mexico pistachio marketing order (order). The order regulates the 
handling of pistachios grown in California, Arizona, and New Mexico and 
is administered locally by the Administrative Committee for Pistachios 
(Committee). This rule streamlines the aflatoxin sampling and testing 
procedures under the order's rules and regulations for pistachios to be 
shipped for domestic human consumption while maintaining sufficient 
aflatoxin controls. It is expected to reduce handler operating costs by 
providing a uniform and consistent aflatoxin sampling and testing 
procedure for pistachios shipped to all market destinations.

DATES: Effective July 24, 2010; comments received by September 21, 2010 
will be considered prior to confirmation as a final rule.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent to the Docket Clerk, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA, 1400 Independence Avenue SW., STOP 0237, Washington, DC 
20250-0237; Fax: (202) 720-8938; or Internet: http://www.regulations.gov. All comments should reference the document number 
and the date and page number of this issue of the Federal Register and 
will be made available for public inspection in the Office of the 
Docket Clerk during regular business hours, or can be viewed at: http://www.regulations.gov. All comments submitted in response to this rule 
will be included in the record and will be made available to the 
public. Please be advised that the identity of the individuals or 
entities submitting the comments will be made public on the Internet at 
the address provided above.

FOR FURTHER INFORMATION CONTACT: Maria Stobbe, 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: 
Maria.Stobbe@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 rule is issued under Marketing 
Agreement and Order No. 983, as amended (7 CFR part 983), regulating 
the handling of pistachios grown in California, Arizona, and New 
Mexico, 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 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 rule modifies the aflatoxin sampling and testing regulations 
currently prescribed under the order. It streamlines the aflatoxin 
sampling and testing procedures under the order's rules and regulations 
for pistachios to be shipped for domestic human consumption, while 
maintaining sufficient aflatoxin controls. It is expected to reduce 
handler operating costs by providing a uniform and consistent aflatoxin 
sampling and testing procedure for pistachios shipped to all market 
destinations. The Committee unanimously approved the recommended 
modifications at its meeting on April 6, 2010.
    Section 983.50 of the pistachio marketing order provides authority 
for aflatoxin regulations that require pistachios to be sampled and 
tested for aflatoxin prior to being shipped for domestic human 
consumption.
    Section 983.150 of the order's rules and regulations contains 
specific aflatoxin sampling and testing requirements and currently 
specifies that three test samples be drawn and prepared for all lots of 
inshell and shelled pistachios, regardless of lot size. The samples are 
then sent to USDA approved laboratories for analysis of aflatoxin 
content. Depending upon the analytical results of the first sample, up 
to two additional tests and averaging the results of all tests may be 
required to determine whether any lot may be certified as ``negative'' 
for aflatoxin. Handlers have the option to rework the lot prior to 
subsequent testing in order to meet the aflatoxin requirements.
    When the order was promulgated in 2004, the aflatoxin sampling and 
testing regulations provided sufficient sampling and testing procedures 
for determining aflatoxin controls for pistachios shipped for domestic 
human consumption. These aflatoxin sampling and testing procedures 
allowed handlers to use similar operating procedures for both domestic 
and export shipments.
    In March 2010, the European Commission (EC), the regulatory body of 
the European Union (EU), adopted a revised Codex Alimentarius 
Commission's (Codex) sampling plan as its regulation for the 
importation of tree nuts. Over the past few years, the percentage of 
U.S. pistachio crop being exported has increased significantly. 
Currently, more than 60 percent of the annual crop is exported, with 
slightly more than half of exports being shipped to the EU and 
requiring special testing and handling procedures. As a result, 
handlers face inconsistent operating procedures and increased operating 
costs as it has become necessary to use two different sampling and 
testing procedures: One for pistachios shipped for domestic human 
consumption and another for pistachios shipped to the EU.
    In an effort to streamline operating procedures, while maintaining 
sufficient aflatoxin level controls, the Committee, at its April 6, 
2010, meeting recommended decreasing the total weight of lot samples 
and increasing the weight of the test samples as specified in Table 1 
for inshell pistachios and Table 2 for shelled pistachios under the 
order's administrative rules and regulations:

[[Page 43047]]

                 Table 1--Inshell Pistachio Lot Sampling Increments for Aflatoxin Certification
----------------------------------------------------------------------------------------------------------------
                                                      Minimum number  of
                                                          incremental       Total weight of     Weight of test
                 Lot weight  (lbs.)                     samples for the       lot sample            sample
                                                          lot sample          (kilograms)         (kilograms)
----------------------------------------------------------------------------------------------------------------
220 or less.........................................                  10                 2.0                 2.0
221-440.............................................                  15                 3.0                 3.0
441-1,100...........................................                  20                 4.0                 4.0
1,101-2,200.........................................                  30                 6.0                 6.0
2,201-4,400.........................................                  40                 8.0                 8.0
4,401-11,000........................................                  60                12.0                 6.0
11,001-22,000.......................................                  80                16.0                 8.0
22,001-150,000......................................                 100                20.0                10.0
----------------------------------------------------------------------------------------------------------------

              Table 2--Shelled Pistachio Kernel Lot Sampling Increments for Aflatoxin Certification
----------------------------------------------------------------------------------------------------------------
                                                      Minimum number  of
                                                          incremental       Total weight of     Weight of test
                 Lot weight  (lbs.)                     samples for the       lot sample            sample
                                                          lot sample          (kilograms)         (kilograms)
----------------------------------------------------------------------------------------------------------------
220 or less.........................................                  10                 1.0                 1.0
221-440.............................................                  15                 1.5                 1.5
441-1,100...........................................                  20                 2.0                 2.0
1,101-2,200.........................................                  30                 3.0                 3.0
2,201-4,400.........................................                  40                 4.0                 4.0
4,401-11,000........................................                  60                 6.0                 3.0
11,001-22,000.......................................                  80                 8.0                 4.0
22,001-150,000......................................                 100                10.0                 5.0
----------------------------------------------------------------------------------------------------------------

    The Committee also recommended changing Sec.  983.150 to specify 
that for pistachio lots of up to 4,400 pounds, one test sample will be 
created from a minimum number of incremental samples and analyzed. For 
lots exceeding 4,400 pounds, two test samples will be created from a 
minimum number of incremental samples and analyzed. If the aflatoxin 
level in the first sample is 10 parts per billion (ppb) or less, the 
lot may be certified ``negative'' for aflatoxin and may be shipped. If 
the aflatoxin level is 20 ppb or less, the handler may either rework 
the lot and draw new samples for analysis, or direct that the second 
sample be analyzed. If the averaged results of the two analyses are 15 
ppb or less, the lot may be certified ``negative'' for aflatoxin and 
may be shipped. Any lots exceeding the specified aflatoxin levels fail, 
and must be reported to the Committee. Failing lots may be reworked or 
destroyed or disposed of as described in Sec.  983.152.
    Further, the Committee recommended removing unnecessary language 
from Sec.  983.150(a). In addition, the Committee also recommended 
changing the term Chromatograph in Sec.  983.150(d)(3) to correctly 
read as Chromatography.

Initial 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 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 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 approximately 29 handlers and 875 producers of pistachios 
in California, Arizona and New Mexico. Small business firms, which 
include handlers regulated under the order, have been defined by the 
Small Business Administration (SBA) (13 CFR 121.201) as those having 
annual receipts of less than $7,000,000. Small agricultural producers 
have been defined as those with annual receipts of less than $750,000.
    Currently, about 72 percent of the California handlers ship less 
than $7,000,000 worth of pistachios on an annual basis and would 
therefore be considered small business firms under the SBA definition. 
Based on acreage, production, and grower prices reported by the 
Committee, the average annual revenue for small handlers is 
approximately $1,721,911. The industry has estimated that one of the 
Arizona handlers and all three New Mexico handlers would also be 
considered small businesses.
    Data provided by the Committee regarding the size of the 2009 
California crop indicates that approximately 630 California growers had 
350,000 pounds or less of assessable dry weight of pistachios. Using 
the most recent grower price of $2.04 per pound for pistachios, it is 
estimated that 81 percent of California producers had receipts of 
approximately $714,000, which is less than $750,000, and thus would be 
considered small business according to the SBA definition. Although 
there is no official data available to date, as these states were 
recently added to the order and have not completed one full crop year 
for reporting purposes, the industry estimates that the majority of 
producers in Arizona and New Mexico would also be considered small 
businesses.
    This rule modifies the aflatoxin sampling and testing regulations 
currently prescribed under the California, Arizona and New Mexico 
pistachio order. It streamlines the aflatoxin sampling and testing 
procedures under the order's rules and regulations for pistachios to be 
shipped for domestic human consumption while maintaining sufficient 
aflatoxin controls. It is expected to reduce handler operating costs by 
providing a uniform and consistent aflatoxin sampling and testing 
procedure for

[[Page 43048]]

pistachios shipped to all market destinations.
    The impact of this regulatory modification was discussed by the 
Committee at its April 6, 2010, meeting. It is anticipated that all 
producers and handlers will benefit from this action regardless of size 
and regardless of the market they ship into, as it streamlines handler 
operations and increases marketing flexibility. Reducing the number of 
required samples, the number of aflatoxin analyses, and the total 
weight of the lot samples, while increasing the weight of the test 
samples for each lot is expected to result in an estimated annual 
savings to the industry of approximately $18,000, including reductions 
of $900 for sampling, $1,400 for testing, $12,750 for labor, and $3,750 
in shipping costs for those small handlers that do not do testing on 
site.
    The Committee discussed alternatives to this action at their April 
6, 2010, meeting, including continuing to operate under the current 
aflatoxin regulations. However, the Committee unanimously agreed that 
operating with the current multiple sampling and testing procedures 
based upon shipping destination would continue to be confusing to the 
industry and would continue to generate higher handler operating costs. 
The recommended modification is expected to eliminate any confusion 
with regard to operating procedures, streamline handling operations, 
and lower handler operating costs.
    This action will not impose any additional reporting or 
recordkeeping requirements on either small or large pistachio 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.
    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 pistachio industry and all interested persons were invited to 
attend the meeting and participate in Committee deliberations. Like all 
Committee meetings, the April 6, 2010, meeting was a public meeting and 
all entities, both large and small, were able to express their views on 
this issue. Finally, interested persons are invited to submit comments 
on this interim rule, including the regulatory and informational 
impacts of this action on small businesses.
    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.fetchTemplateData.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.
    This rule invites comments on modifications to the aflatoxin 
regulations currently prescribed under the pistachio marketing order. 
Any comments received will be considered prior to finalization of this 
rule.
    After consideration of all relevant material presented, including 
the Committee's recommendation, and other information, it is found that 
this interim 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) These changes are necessary to provide consistency in 
handler operating procedures and to reduce handler operating costs; (2) 
handlers are aware of these changes, which were unanimously recommended 
by the Committee at a public meeting where interested parties had an 
opportunity to provide input; and (3) this rule provides a 60-day 
comment period, and any comments received will be considered prior to 
finalization of this rule.

List of Subjects in 7 CFR Part 983

    Marketing agreements and orders, Pistachios, Reporting and 
recordkeeping requirements.

0
For the reasons set forth in the preamble, 7 CFR part 983 is amended as 
follows:

PART 983--PISTACHIOS GROWN IN CALIFORNIA, ARIZONA, AND NEW MEXICO

0
1. The authority citation for 7 CFR part 983 continues to read as 
follows:

    Authority:  7 U.S.C. 601-674.

0
2. Amend Sec.  983.150 by revising paragraphs (a), (d)(2), (d)(3), 
(d)(4), and (d)(6) to read as follows:

Sec.  983.150  Aflatoxin regulations.

    (a) Maximum level. No handler shall ship for domestic human 
consumption, pistachios that exceed an aflatoxin level of 15 ppb. All 
shipments must also be covered by an aflatoxin inspection certificate. 
Pistachios that fail to meet the aflatoxin requirements shall be 
disposed in such manner as described in Failed lots/rework procedure of 
this part.
* * * * *
    (d) * * *
    (1) * * *
    (2) Test samples for aflatoxin. Prior to submission of samples to 
an accredited laboratory for aflatoxin analysis, one sample (``test 
sample'') shall be created from the pistachios designated for aflatoxin 
testing in compliance with Tables 1 and 2 of this paragraph for inshell 
and kernel pistachio lots that weigh up to and including 4,400 pounds. 
For lot sizes larger than 4,400 pounds, two samples (``test samples'') 
shall be created equally from the pistachios designated for aflatoxin 
testing in compliance with the requirements to Tables 1 and 2 of this 
paragraph. The test samples shall be prepared by, or under the 
supervision of an inspector, or as approved under an alternative USDA-
recognized inspection program. The test samples shall be designated by 
an inspector as Test Sample 1 and Test Sample 2. Each 
sample shall be placed in a suitable container, with the lot number 
clearly identified, and then submitted to an accredited laboratory. The 
gross weight of the inshell lot sample for aflatoxin testing and the 
minimum number of incremental samples required are shown in Table 1 of 
this paragraph. The gross weight of the kernel lot sample for aflatoxin 
testing and the minimum number of incremental samples required is shown 
in the Table 2 of this paragraph.

[[Page 43049]]

     Table 1 to Sec.   983.150(d)(2)--Inshell Pistachio Lot Sampling Increments for Aflatoxin Certification
----------------------------------------------------------------------------------------------------------------
                                                      Minimum number  of
                                                          incremental       Total weight of     Weight of test
                 Lot weight  (lbs.)                     samples for the       lot sample            sample
                                                          lot sample          (kilograms)         (kilograms)
----------------------------------------------------------------------------------------------------------------
220 or less.........................................                  10                 2.0                 2.0
221-440.............................................                  15                 3.0                 3.0
441-1,100...........................................                  20                 4.0                 4.0
1,101-2,200.........................................                  30                 6.0                 6.0
2,201-4,400.........................................                  40                 8.0                 8.0
4,401-11,000........................................                  60                12.0                 6.0
11,001-22,000.......................................                  80                16.0                 8.0
22,001-150,000......................................                 100                20.0                10.0
----------------------------------------------------------------------------------------------------------------

  Table 2 to Sec.   983.150(d)(2)--Shelled Pistachio Kernel Lot Sampling Increments for Aflatoxin Certification
----------------------------------------------------------------------------------------------------------------
                                                      Minimum number  of
                                                          incremental       Total weight of     Weight of test
                 Lot weight  (lbs.)                     samples for the       lot sample            sample
                                                          lot sample          (kilograms)         (kilograms)
----------------------------------------------------------------------------------------------------------------
220 or less.........................................                  10                 1.0                 1.0
221-440.............................................                  15                 1.5                 1.5
441-1,100...........................................                  20                 2.0                 2.0
1,101-2,200.........................................                  30                 3.0                 3.0
2,201-4,400.........................................                  40                 4.0                 4.0
4,401-11,000........................................                  60                 6.0                 3.0
11,001-22,000.......................................                  80                 8.0                 4.0
22,001-150,000......................................                 100                10.0                 5.0
----------------------------------------------------------------------------------------------------------------

     (3) Testing of pistachios. Test samples shall be received and 
logged by an accredited laboratory and each test sample shall be 
prepared and analyzed using High Pressure Liquid Chromatography (HPLC), 
Vicam Method (Aflatest), or other methods as recommended by not fewer 
than eight members of the committee and approved by the Secretary. The 
aflatoxin level shall be calculated on a kernel weight basis.
    (4) Certification of lots ``negative'' as to aflatoxin. (i) Lots 
which require a single test sample will be certified as ``negative'' on 
the aflatoxin certificate if the sample has an aflatoxin level at or 
below 15 ppb. If the aflatoxin level is above 15 ppb, the lot fails and 
the accredited laboratory shall fill out a failed lot notification 
report as specified in Sec. Sec.  983.52 and 983.152.
    (ii) Lots which require two test samples will be certified as 
``negative'' on the aflatoxin inspection certificate if Test Sample 
1 has an aflatoxin level at or below 10 ppb. If the aflatoxin 
level of Test Sample 1 is above 20 ppb, the lot fails and the 
accredited laboratory shall fill out a failed lot notification report 
as specified in Sec. Sec.  983.52 and 983.152. If the aflatoxin level 
of Test Sample 1 is above 10 ppb and at or below 20 ppb, the 
accredited laboratory may at the handler's discretion analyze Test 
Sample 2 and the test results of Test Samples 1 and 
2 will be averaged. Alternately, the handler may elect to 
withdraw the lot from testing, rework the lot, and resubmit it for 
testing after reworking. If the handler directs the laboratory to 
proceed with the analysis of Test Sample 2, a lot will be 
certified as negative to aflatoxin and the laboratory shall issue an 
aflatoxin inspection certificate if the averaged results of Test Sample 
1 and Test Sample 2 is at or below 15 ppb. If the 
averaged aflatoxin level of Test Samples 1 and 2 is 
above 15 ppb, the lot fails and the accredited laboratory shall fill 
out a failed lot notification report as specified in Sec. Sec.  983.52 
and 983.152.
    (iii) The accredited laboratory shall send a copy of the failed lot 
notification report to the Committee and to the failed lot's owner 
within 10 working days of any failure described in this section. If the 
lot is certified as negative as described in this section, the 
aflatoxin inspection certificate shall certify the lot using a 
certification form identifying each lot by weight, grade, and date. The 
certification expires for the lot or remainder of the lot after 12 
months.
* * * * *
    (6) Test samples that are not used for analysis. If a handler does 
not elect to use Test Sample 2 for certification purposes, the 
handler may request that the laboratory return it to the handler.

    Dated: July 20, 2010.
Rayne Pegg,
Administrator, Agricultural Marketing Service.
[FR Doc. 2010-18089 Filed 7-22-10; 8:45 am]
BILLING CODE 3410-02-P
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