Source: https://www.federalregister.gov/articles/2000/10/30/00-27716/2000-marketing-quotas-and-price-support-levels-for-fire-cured-type-21-fire-cured-types-22-23-dark
Timestamp: 2015-02-28 23:05:02
Document Index: 555951806

Matched Legal Cases: ['arts 723', 'ART 723', 'art 723', '§ 723', '§ 723', '§ 723', '§ 723', '§ 723', 'ART 1464', 'art 1464', '§ 1464', '§ 1464', '§ 1464', '§ 1464', '§ 1464']

Federal Register | 2000 Marketing Quotas and Price Support Levels for Fire-Cured (Type 21), Fire-Cured (Types 22-23), Dark Air-Cured (Types 35-36), Virginia Sun-Cured (Type 37), and Cigar-Filler and Binder (Types 42-44 and 53-55) Tobacco
Publication Date: Monday, October 30, 2000
Dates: March 1, 2000.
Effective Date: 03/01/2000
65 FR 64589
-64594 (6 pages)
0560-AF86
Document Number: 00-27716
Shorter URL: https://federalregister.gov/a/00-27716 Related Topics
The purpose of this rule is to codify the national marketing quotas and price support levels for the 2000 crops for several kinds of tobacco announced by press release on March 1, 2000.
2000-Crop Marketing Quotas and Price Support Levels for Five Kinds of Tobacco 2 actions from January 2000 to May 2000
Discussion of Comments Received From Press Release
(6) Referendum Results for Fire-Cured (Types 21-23) and Dark Air-cured (Types 35-36) Tobaccos
This rule has been determined to be significant and was reviewed by OMB under Executive Order 12866.
Unfunded Federal Mandates Back to Top
Statutory Background Back to Top
In accordance with section 312 of the 1938 Act, for tobaccos other than flue-cured tobacco and burley tobacco, the Secretary of Agriculture is required to proclaim not later than March 1 of any marketing year (MY) a national marketing quota for those tobaccos for which marketing quotas have been approved in the prior 3 years. A referendum on quotas for each kind is held every 3 years.
On March 1, 2000, the Secretary determined and announced the national marketing quotas and price support levels for the 2000 crops of fire-cured (type 21), fire-cured (types 22-23), dark air-cured (types 35-36), Virginia sun-cured (type 37), and cigar-filler and binder (types 42-44 and 53-55) tobaccos. A number of related determinations were made at the same time which this final rule affirms. And, because the 1999 MY was the last of 3 consecutive years of quota for fire-cured (types 22-23) and dark air-cured (types 35-36) tobacco, the Secretary also announced that referenda would be conducted by mail with respect to those tobaccos.
During the period March 20-24, 2000, eligible producers of fire-cured (types 21-23) and dark air-cured (types 35-36) tobaccos voted in separate referenda to determine whether such producers approved marketing quotas for the 2000, 2001, and 2002 MYs for these tobaccos. Of the producers voting, 92.0 percent favored marketing quotas for fire-cured (types 21-23) tobacco and 90.4 percent favored quotas for dark air-cured (types 35-36) tobaccos. Accordingly, quotas and price support for both fire-cured (types 21-23) and dark air-cured (types 35-36) tobaccos are in effect for the 2000 though 2002 MYs.
Quotas for the other tobaccos covered by this notice were approved in referenda and are still in effect.
Under the 1949 Act, price support is required to be made available for each crop of a kind of tobacco for which marketing quotas are in effect or for which marketing quotas have not been disapproved by producers. With respect to the 2000 crops of the kinds of tobacco that are the subject of this notice, the respective maximum levels of price support for these kinds of tobacco is determined in accordance with section 106 of the 1949 Act. Announcement of the price support levels for these five kinds of tobacco are normally made before the planting seasons. Under the provisions of Section 1108 (c), of 99, the price support level announcements do not require prior rulemaking. For the 2000 crops, the price support announcements were made on March 1, 2000, at the same time the quota announcements were made. Quota and price support determinations for burley and flue-cured tobacco are made separately and are the subject of separate notices.
Statutory Provisions Back to Top
Section 313(g) of the 1938 Act provides that the Secretary may convert the national marketing quota into a national acreage allotment for apportionment to individual farms. Since producers of these kinds of tobacco generally produce considerably less than their respective national acreage allotments allow, a larger quota is necessary to make available production equal to the reserve supply level. Further, under section 312(b) of the 1938 Act, the amount of the national marketing quota may, not later than the following March 1, be increased by not more than 20 percent over the straight formula amount if the Secretary determines that such increase is necessary in order to meet market demands or to avoid undue restriction of marketings in adjusting the total supply to the reserve supply level.
On February 14, 2000, a press release was issued in which interested persons were requested to comment with respect to setting quotas for the kinds of tobacco addressed in this rule.
Discussion of Comments Received From Press Release Back to Top
Fifteen written responses were received during the comment period which ended March 1, 2000. A summary of these comments by kinds of tobacco follows:
(1) Fire-cured (type 21) tobacco. One comment was received, recommending a 15-percent reduction in 2000 quotas.
(2) Fire-cured (types 22-23) tobacco. Five comments were received.
Recommendations ranged from a 5-percent to a 71/2-percent increase in MY 2000 quotas.
(3) Dark air-cured (types 35-36) tobacco. Six comments were received. All recommended a 5-percent increase in the quota.
(4) Virginia sun-cured (type 37) tobacco. One comment was received, recommending no change in quota.
(5) Cigar-filler and binder (types 42-44 and 53-55) tobacco. Two comments were received. One recommended a 15-percent reduction in quotas, while the other recommended a 20-percent reduction.
Quota and Related Determinations Back to Top
The tobacco program is, through assessments, operated at no net cost to taxpayers other than the costs common to all price support operations. Accordingly, producer comments are given considerable weight in this review. Based on a review of the comments received and the latest available statistics of the Federal Government, which are the most reliable data available, the following determinations were made for the five kinds of tobacco.
The average annual quantity of fire-cured (type 21) tobacco produced in the United States that is estimated to have been consumed in the United States during the 10 MYs preceding the 1999 MY was approximately 1.0 million pounds (farm sales weight basis). The average annual quantity produced in the United States and exported from the United States during the 10 MYs preceding the 1999 MY was 1.7 million pounds (farm sales weight basis). Both domestic use and exports have trended downward. Because of these considerations, a normal year's domestic consumption has been determined to be 0.7 million pounds, and a normal year's exports have been determined to be 1.62 million pounds. Application of the formula prescribed by section 301(b)(14)(B) of the 1938 Act results in a reserve supply level of 4.8 million pounds (farm sales weight basis).
Manufacturers and dealers reported stocks held on October 1, 1999, of 2.7 million pounds. The 1999 crop is estimated to be 2.5 million pounds. Therefore, total supply for the 1999 MY is 5.2 million pounds. During the 1999 MY, it is estimated that disappearance will total approximately 2.1 million pounds. Deducting this disappearance from total supply results in a 2000 MY beginning stock estimate of 3.1 million pounds.
The difference between the reserve supply level and the estimated carryover on October 1, 2000, is 1.7 million pounds. This represents the quantity that may be marketed which will make available during the 2000 MY a supply equal to the reserve supply level. More than 95 percent of the announced national marketing quota is expected to be produced. Accordingly, it has been determined that a 2000 national marketing quota of 1.782 million pounds is necessary to make available production of 1.7 million pounds. As permitted by section 312(b) of the 1938 Act, it was further determined that the 2000 national marketing quota should be increased by 20 percent over the normal formula amount in order to avoid undue restriction of marketings. This determination took into account the size of last year's quota, the comments, the long storage time for aging purposes for this tobacco, and the possibility of changes in demand over expected demand. Thus, the national marketing quota for the 2000 crop is 2.138 million pounds.
In accordance with section 313(g) of the 1938 Act, dividing the 2000 national marketing quota of 2.138 million pounds by the 1995-99, 5-year national average yield of 1,566 pounds per acre results in a 2000 national acreage allotment of 1,365.26 acres.
Pursuant to the provisions of section 313(g) of the 1938 Act, a national acreage factor of 0.85 is determined by dividing the national acreage allotment for the 2000 MY, less a national reserve of 5.58 acres, by the total of the 2000 preliminary farm acreage allotments (previous year's allotments). The preliminary farm acreage allotments reflect the factors specified in section 313(g) of the 1938 Act for apportioning the national acreage allotment, less the national reserve, to old farms.
The average annual quantity of fire-cured (types 22-23) tobacco produced in the United States that is estimated to have been consumed in the United States during the 10 MYs preceding the 1999 MY was approximately 19.8 million pounds (farm sales weight basis). The average annual quantity produced in the United States and exported during the 10 MYs preceding the 1999 MY was 15.6 million pounds (farm sales weight basis). Domestic use has trended upward while exports have varied. Because of these considerations, a normal year's domestic consumption has been determined to be 29.9 million pounds, and a normal year's exports have been determined to be 19.0 million pounds. Application of the formula prescribed by section 301(b)(14)(B) of the 1938 Act results in a reserve supply level of 119.3 million pounds (farm sales weight basis).
Manufacturers and dealers reported stocks held on October 1, 1999, of 86.8 million pounds. The 1999 crop is estimated to be 34.0 million pounds. Therefore, total supply for the 1999 MY is 120.8 million pounds. During the 1999 MY, it is estimated that disappearance will total approximately 40.0 million pounds. Deducting this disappearance from total supply results in a 2000 MY beginning stock estimate of 86.8 million pounds.
The difference between the reserve supply level and the estimated carryover on October 1, 2000, is 32.5 million pounds. This represents the quantity that may be marketed that will make available during the 2000 MY a supply equal to the reserve supply level. Over 90 percent of the announced national marketing quota is expected to be produced. Accordingly, it has been determined that a 2000 national marketing quota of 35.75 million pounds is necessary to make available production of 32.5 million pounds.
Utilizing section 312(b) of the 1938 Act, it was further determined for the same reason as with fire-cured (type 21) tobacco, that the 2000 national marketing quota should be increased by 20 percent over the normal formula amount in order to avoid undue restriction of marketings. Thus, the national marketing quota for the 2000 crop is 42.9 million pounds.
In accordance with section 313(g) of the 1938 Act, dividing the 2000 national marketing quota of 42.9 million pounds by the 1995-99, 5-year average yield of 2,494 pounds per acre results in a 2000 national acreage allotment of 17,201.28 acres.
Pursuant to the provisions of section 313(g) of the 1938 Act, a national acreage factor of 1.075 is determined by dividing the national acreage allotment for the 2000 MY, less a national reserve of 37.49 acres, by the total of the 2000 preliminary farm acreage allotments (previous year's allotments). The preliminary farm acreage allotments reflect the factors specified in section 313(g) of the 1938 Act for apportioning the national acreage allotment, less the national reserve, to old farms.
The average annual quantity of dark air-cured (types 35-36) tobacco produced in the United States that is estimated to have been consumed in the United States during the 10 MYs preceding the 1999 MY was approximately 9.1 million pounds. The average annual quantity produced in the United States and exported from the United States during the 10 MYs preceding the 1999 MY was 1.2 million pounds (farm sales weight basis). Both domestic use and exports have been erratic. Because of these considerations, a normal year's domestic consumption has been determined to be 11.3 million pounds, and a normal year's exports have been determined to be 1.5 million pounds. Application of the formula prescribed by section 301(b)(14)(B) of the 1938 Act results in a reserve supply level of 35.3 million pounds.
Manufacturers and dealers reported stocks held on October 1, 1999, of 24.0 million pounds. The 1999 crop is estimated to be 10.6 million pounds. Therefore, total supply for the 1999 MY is 34.6 million pounds. During the 1999 MY, it is estimated that disappearance will total approximately 9.2 million pounds. Deducting this disappearance from total supply results in a 2000 MY beginning stock estimate of 25.4 million pounds.
The difference between the reserve supply level and the estimated carryover on October 1, 2000, is 9.9 million pounds. This represents the quantity that may be marketed that will make available during the 2000 MY a supply equal to the reserve supply level. Over 90 percent of the announced national marketing quota is expected to be produced. Accordingly, it has been determined that a national marketing quota of 10.625 million pounds is necessary to make available production of 9.9 million pounds. In accordance with section 312(b) of the 1938 Act, it has been further determined that the 2000 national marketing quota should be increased by 20 percent over the normal formula amount in order to avoid undue restriction of marketings. This determination took into account the same factors as with fire-cured (type 21) tobacco and industry preferences. This results in a national marketing quota for the 2000 MY of 12.75 million pounds.
In accordance with section 313(g) of the 1938 Act, dividing the 2000 national marketing quota of 12.75 million pounds by the 1995-99, 5-year average yield of 2,187 pounds per acre results in a 2000 national acreage allotment of 5,829.90 acres.
Pursuant to the provisions of section 313(g) of the 1938 Act, a national acreage factor of 1.05 is determined by dividing the national acreage allotment for the 1999 MY, less a national reserve of 28.61 acres, by the total of the 2000 preliminary farm acreage allotments (previous year's allotments). The preliminary farm acreage allotments reflect the factors specified in section 313(g) of the 1938 Act for apportioning the national acreage allotment, less the national reserve, to old farms.
The average annual quantity of Virginia sun-cured (type 37) tobacco produced in the United States that is estimated to have been consumed in the United States during the 10 MYs preceding the 1999 MY was approximately 60,000 pounds. The average annual quantity produced in the United States and exported from the United States during the 10 MYs preceding the 1999 MY was approximately 100,000 pounds (farm sales weight basis). Both domestic use and exports are erratic. Because of these considerations, a normal year's domestic consumption has been determined to be 79,000 pounds, and a normal year's exports have been determined to be 17,850 pounds. Application of the formula prescribed by section 301(b)(14)(B) of the 1938 Act results in a reserve supply level of 259,000 pounds.
Manufacturers and dealers reported stocks held on October 1, 1999, of 50,000 pounds. The 1999 crop is estimated to be 160,000 pounds. Therefore, total supply for the 1999 MY is 210,000 pounds. During the 1999 MY, it is estimated that disappearance will total approximately 80,000 pounds. Deducting this disappearance from total supply results in a 2000 MY beginning stock estimate of 130,000 pounds.
The difference between the reserve supply level and the estimated carryover on October 1, 1999, is 129,000 pounds. This represents the quantity that may be marketed that will make available during the 1999 MY a supply equal to the reserve supply level. About three-quarters of the announced national marketing quota is expected to be produced. Accordingly, it has been determined that a 2000 national marketing quota of 171,000 pounds is necessary to make available production of 129,000 pounds. Thus, the national marketing quota for the 2000 crop is 171,000 pounds.
In accordance with section 313(g) of the 1938 Act, dividing the 2000 national marketing quota of 171,000 pounds by the 1995-99, 5-year average yield of 1,407 pounds per acre results in a 2000 national acreage allotment of 121.54 acres.
Pursuant to the provisions of section 313(g) of the 1938 Act, a national acreage factor of 1.0 is determined by dividing the national acreage allotment for the 2000 MY, less a national reserve of 0.58 acres, by the total of the 2000 preliminary farm acreage allotments (previous year's allotments). The preliminary farm acreage allotments reflect the factors specified in section 313(g) of the 1938 Act for apportioning the national acreage allotment, less the national reserve, to old farms.
The average annual quantity of cigar-filler and binder (types 42-44 and 53-55) tobacco produced in the United States that is estimated to have been consumed in the United States during the 10 MYs preceding the 1999 MY was approximately 10.3 million pounds. The average annual quantity produced in the United States and exported from the United States during the 10 MYs preceding the 1999 MY was less than 100,000 pounds (farm sales weight). Domestic use has trended downward and exports are very small. Thus, a normal year's domestic consumption has been determined to be 5.2 million pounds, and a normal year's exports have been determined to be 70,000 pounds. Application of the formula prescribed by section 301(b)(14)(B) of the 1938 Act results in a reserve supply level of 15.1 million pounds.
Manufacturers and dealers reported stocks held on October 1, 1999, of 14.3 million pounds. The 1999 crop is estimated to be 2.8 million pounds. Therefore, total supply for the 1999 MY is 17.1 million pounds. During the 1999 MY, it is estimated that disappearance will total about 5.0 million pounds. Deducting this disappearance from total supply results in a 2000 MY beginning stock estimate of 12.1 million pounds.
The difference between the reserve supply level and the estimated carryover on October 1, 2000, is 3.0 million pounds. This represents the quantity that may be marketed that will make available during the 2000 MY a supply equal to the reserve supply level. About 80 percent of the announced national marketing quota is expected to be produced. Accordingly, it has been determined that a 2000 national marketing quota of 3.64 million pounds is necessary to make available production of 3.0 million pounds. This results in a 2000 national marketing quota of 3.64 million pounds. This determination reflects that there are short reserve supplies and takes into account possible changes in expected demand and the fact that even with this adjustment the 2000 quota will be less than the 1999 crop quota.
In accordance with section 313(g) of the 1938 Act, dividing the 2000 national marketing quota of 3.64 million pounds by the 1995-99, 5-year average yield of 2,139 pounds per acre results in a 2000 national acreage allotment of 1,701.73 acres.
Pursuant to the provisions of section 313(g), of the 1938 Act, a national factor of 0.825 is determined by dividing the national acreage allotment for the 2000 MY, less a national reserve of 6.57 acres, by the total of the 2000 preliminary farm acreage allotments (previous year's allotments). The preliminary farm acreage allotments reflect the factors specified in section 313(g) of the 1938 Act for apportioning the national acreage allotment, less the national reserve, to old farms.
Because of the results of the producer referendum, marketing quotas shall be in effect for the 2000 MY for both fire-cured (types 21-23) and dark air-cured (types 35-36) tobaccos. In separate referenda held March 20-24, 2000, 92.0 percent of fire-cured producers and 90.4 percent of dark air-cured producers voted in favor of quotas.
Referendum Data Back to Top
Fire-cured (types 21-23)
Dark Air-cured (types 35-36)
Price Support Back to Top
Section 106(f)(6)(A) of the 1949 Act provides that the level of support for the 2000 crop of a kind of tobacco (other than flue-cured and burley) shall be the level in cents per pound at which the 1999 crop of such kind of tobacco was supported, plus or minus, as appropriate, the amount by which the basic support level for the 2000 crop, as it would otherwise be determined under section 106(b) of the 1949 Act, is greater or less than the support level for the 1999 crop, as it would otherwise be determined under section 106(b). To the extent that the price support level would be increased as a result of that comparison, section 106(f) provides that the increase may be modified using the provisions of 106(d). Under 106(d), the Secretary may reduce the level of support for grades the Secretary determines will likely be in excess supply so long as the weighted level of support for all grades maintains at least 65 percent of the increase in the price support (from the previous year). The Secretary must consult with the appropriate tobacco associations and take into consideration the supply, and anticipated demand for the tobacco, including the effect of the action on other kinds of quota tobacco. In determining whether the supply of any grade of any kind of tobacco of a crop will be excessive, the Secretary is required to consider the domestic supply, including domestic inventories, the amount of such tobacco pledged as security for price support loans, and anticipated domestic and export demand, based on the maturity, uniformity, and stalk position of such tobacco.
Price Support Determinations Back to Top
The following levels of price support for the 1999 crops of various kinds of tobacco, which were determined in accordance with section 106(f)(6)(A) of the 1949 Act, are as follows:
Fire-cured (type 21)
Fire-cured (types 22-23)
Virginia sun-cured (type 37)
Cigar-filler and binder (types 42-44 and 53-55)
For the 2000 crop year:
(1) Average parity indexes for calendar year periods 1996-1998 and 1997-1999 are as follows:
(3) 1999 ratio of 1,546 to 298 = 5.19; 2000 ratio of 1,548 to 298 = 5.19.
(4) Ratios times 1959 support levels are as follows:
Basic support level1
Increase from 1999 to 2000
2000 (¢/lb.)
11999 ratio is 5.19, 2000 ratio is 5.19.
Cigar-filler and binder (types 42-44, 53-55)
Accordingly, the following price support determinations were announced on March 1, 2000, for the 2000 crops of the tobaccos which are the subject of this notice:
Cigar-filler and binder (types 42-44and 53-55)
Accordingly, 7 CFR parts 723 and 1464 are amended to read as follows:
PART 723—TOBACCO Back to Top
1.The authority citation for 7 CFR part 723 continues to read as follows: Authority:
7 U.S.C. 1301, 1311-1314, 1314-1, 1314b, 1314b-1, 1314b-2, 1314c, 1314d, 1314e, 1314f, 1314i, 1315, 1316, 1362, 1363, 1372-75, 1421, 1445-1, and 1445-2.
2.Section 723.113 is amended by adding paragraph (h) to read as follows: § 723.113 Fire-cured (type 21) tobacco.
(h) The 2000-crop national marketing quota is 2.138 million pounds.
3.Section 723.114 is amended by adding paragraph (h) to read as follows: § 723.114 Fire-cured (types 22-23) tobacco.
(h) The 2000-crop national marketing quota is 42.9 million pounds.
4.Section 723.115 is amended by adding paragraph (h) to read as follows: § 723.115 Dark air-cured (types 35-36) tobacco.
(h) The 2000-crop national marketing quota is 12.75 million pounds.
5.Section 723.116 is amended by adding paragraph (h) to read as follows: § 723.116 Sun-cured (type 37) tobacco.
(h) The 2000-crop national marketing quota is 171,000 pounds.
6.Section 723.117 is amended by adding paragraph (h) to read as follows: § 723.117 Cigar-filler and binder (types 42-44 and 53-55) tobacco.
(h) The 2000-crop national marketing quota is 3.64 million pounds.
PART 1464—TOBACCO Back to Top
7.The authority citation for 7 CFR part 1464 continues to read as follows: Authority:
7 U.S.C. 1421, 1423, 1441, 1445, and 1445-1; 15 U.S.C. 714b and 714c.
8.Section 1464.13 is amended by adding paragraph (h) to read as follows: § 1464.13 Fire-cured (type 21) tobacco.
(h) The 2000-crop national price support level is 155.9 cents per pound.
9.Section 1464.14 is amended by adding paragraph (h) to read as follows: § 1464.14 Fire-cured (types 22-23) tobacco.
(h) The 2000-crop national price support level is 171.6 cents per pound.
10.Section 1464.15 is amended by adding paragraph (h) to read as follows: § 1464.15 Dark air-cured (types 35-36) tobacco.
(h) The 2000-crop national price support level is 148.1 cents per pound.
11.Section 1464.16 is amended by adding paragraph (h) to read as follows: § 1464.16 Virginia sun-cured (type 37) tobacco.
(h) The 2000-crop national price support level is 138.0 cents per pound.
12.Section 1464.17 is amended by adding paragraph (h) to read as follows: § 1464.17 Cigar-filler and binder (types 42-44 and 53-55) tobacco.
(h) The 2000-crop national price support level is 123.8 cents per pound.
Signed at Washington, DC, on October 20, 2000.
[FR Doc. 00-27716 Filed 10-27-00; 8:45 am]