Spearmint Oil Produced in the Far West; Revision of the Salable Quantity and Allotment Percentage for ``Class 3'' Native Spearmint Oil for the 1993-94 Marketing Year

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 985

[FV94-985-2IFR]

Spearmint Oil Produced in the Far West; Revision of the Salable

Quantity and Allotment Percentage for ``Class 3'' Native Spearmint Oil

for the 1993-94 Marketing Year

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

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SUMMARY: This interim final rule increases the quantity of Class 3

(Native) spearmint oil produced in the Far West that handlers may

purchase from, or handle for, producers during the 1993-94 marketing

year. This rule was recommended by the Spearmint Oil Administrative

Committee (Committee), the agency responsible for local administration

of the marketing order for spearmint oil produced in the Far West. This

rule was recommended in order to avoid extreme fluctuations in supplies

and prices and thus help to maintain stability in the spearmint oil

market.

DATES: Effective on April 28, 1994; comments received by May 31, 1994,

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 in triplicate to the Docket

Clerk, Fruit and Vegetable Division, AMS, USDA, room 2525, South

Building, P.O. Box 96456, Washington, DC 20090-6456, Fax: (202) 720-

5698. All comments should reference the docket 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.

FOR FURTHER INFORMATION CONTACT: Robert J. Curry, Northwest Marketing

Field Office, Marketing Order Administration Branch, Fruit and

Vegetable Division, AMS, USDA, 1220 SW. Third Avenue, room 369,

Portland, Oregon 97204; telephone: (503) 326-2724; or Christian D.

Nissen, Marketing Order Administration Branch, Fruit and Vegetable

Division, AMS, USDA, room 2525, South Building, P.O. Box 96456,

Washington, DC 20090-6456; telephone: (202) 720-5127.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing Order

No. 985 [7 CFR part 985], regulating the handling of spearmint oil

produced in the Far West (Washington, Idaho, Oregon, and designated

parts of California, Nevada, Montana, and Utah), hereinafter referred

to as the ``order.'' This 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 (Department) is issuing this rule in

conformance with Executive Order 12866.

This rule has been reviewed under Executive Order 12778, Civil

Justice Reform. Under the provisions of the marketing order now in

effect, salable quantities and allotment percentages may be established

for classes of spearmint oil produced in the Far West. This rule

increases the quantity of Class 3 spearmint oil produced in the Far

West that may be purchased from or handled for producers by handlers

during the 1993-94 marketing year, which ends on May 31, 1994. 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 in equity to review the

Secretary's ruling on the petition, provided a bill in equity is filed

not later than 20 days after date of the entry of the ruling.

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 action on small

entities.

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.

There are eight spearmint oil handlers subject to regulation under

the order and approximately 260 producers of spearmint oil in the

regulated production area. Of the 260 producers, approximately 160

producers hold ``Class 1'' (Scotch) oil allotment base, and 145

producers hold ``Class 3'' (Native) oil allotment base. Small

agricultural service firms have been defined by the Small Business

Administration [13 CFR 121.601] as those having annual receipts of less

than $3,500,000, and small agricultural producers are defined as those

whose annual receipts are less than $500,000. A minority of handlers

and producers of Far West spearmint oil may be classified as small

entities.

The Far West spearmint oil industry is characterized by producers

whose farming operations generally involve more than one commodity and

whose income from farming operations is not exclusively dependent on

the production of spearmint oil. The U.S. production of spearmint oil

is concentrated in the Far West, primarily Washington, Idaho, and

Oregon (part of the area covered by the order). Spearmint oil is also

produced in the Midwest. The production area covered by the order

normally accounts for 75 percent of the annual U.S. production of

spearmint oil.

This rule increases the salable quantity and allotment percentage

of Native spearmint oil that handlers may purchase from, or handle for,

producers during the 1993-94 marketing year, which ends on May 31,

1994. This rule increases the salable quantity from 714,665 pounds to

772,611 pounds and the allotment percentage from 37 percent to 40

percent for Native spearmint oil.

The salable quantity is the total quantity of each class of oil

which handlers may purchase from, or handle on behalf of, producers

during a marketing year. Each producer is allotted a share of the

salable quantity by applying the allotment percentage to the producer's

allotment base for the applicable class of spearmint oil.

The initial salable quantities and allotment percentages for both

Native and Scotch spearmint oils for the 1993-94 marketing year were

recommended by the Committee at its October 15, 1992, meeting. The

Committee recommended salable quantities of 714,665 pounds and 716,164

pounds for Native and Scotch oils, respectively, and allotment

percentages of 37 percent and 41 percent for Native and Scotch oils,

respectively.

A proposed rule incorporating the Committee's October 15, 1992,

recommendation was published in the December 7, 1992, issue of the

Federal Register [57 FR 57695]. Comments on the proposed rule were

solicited from interested persons until January 6, 1993. No comments

were received. Accordingly, based upon analysis of available

information, a final rule establishing the Committee's recommendation

as the salable quantities and allotment percentages for the 1993-94

marketing year was published in the May 13, 1993, issue of the Federal

Register [58 FR 28340].

Pursuant to authority contained in sections 985.50, 985.51, and

985.52 of the order, at its February 23, 1994, meeting in Pasco,

Washington, the Committee recommended that the salable quantity and

allotment percentage for Native spearmint oil for the 1993-94 marketing

year be increased. The Committee vote resulted in seven members in

favor and one member opposed to the recommendation. The member voting

in opposition believes current demand for Native spearmint oil is not

adequate enough to warrant an increase in the salable quantity and

allotment percentage.

The Committee's recommendation to increase the allotment percentage

for Native spearmint oil by three percent results in a 57,946 pound

increase in the salable quantity, from 714,665 to 772,611 pounds.

Growers currently hold in reserve 1,436,020 pounds of Native oil and

948,063 pounds of Scotch oil. However, the Committee states that not

all producers have reserve oil available to fill their increase in the

salable quantity. In those cases, no additional oil is made available

to the market. Therefore, this rule provides an actual increase of

55,553 pounds of additional base rather than the calculated amount.

This small difference between the calculated and actual amounts of

released oil will not have a significant impact on the availability of

marketable oil.

The Committee, in reaching its decision to recommend an increase in

the 1993-94 salable quantity and allotment percentage for Native

spearmint oil, took into consideration the current supply and

anticipated demand for both Native and Scotch spearmint oils. The

available supply of Native and Scotch spearmint oil as of February 23,

1994, is 59,599 pounds and 175,000 pounds, respectively. When

considering its initial recommendation for the 1993-94 season, the

Committee estimated that the recommended salable quantity and allotment

percentage would result in an approximate carryover of 90,000 pounds of

Native oil. This places the current available supply of Native oil

below the expected carryover.

Over the past five years, the average utilization of Native oil

between March 1 and May 31 is 91,375 pounds. This figure is

considerably more than the existing available supply. In addition, a

majority of spearmint oil buyers indicated they will be in a position

to buy additional Native spearmint oil if it is made available. By

increasing the Native spearmint oil allotment percentage by three

percent, the available supply (as of February 23, 1994), will increase

by 55,553 pounds, from 59,599 pounds to 115,152 pounds.

In its deliberations on how best to meet the anticipated demand,

Committee members and other industry participants indicated that the

available Native spearmint oil supply should be increased by three to

seven percent. The majority of the individuals recommending some level

of increase favored three percent, indicating a higher level may push

Native oil supply into a surplus situation before the end of the

marketing year. The Committee did not recommend an increase in the

supply of Scotch spearmint oil since it is anticipated that there will

be a surplus supply of this type of oil by the end of the marketing

year.

The Department, based on its analysis of available information, has

determined that an allotment percentage of 40 percent should be

established for Native spearmint oil for the 1993-94 marketing year.

This percentage will provide an increase in the salable quantity of

Native spearmint oil from 714,665 pounds to 772,611 pounds.

Based on available information, the Administrator of the AMS has

determined that the issuance of this interim final rule will not have a

significant economic impact on a substantial number of small entities.

After consideration of all relevant matter presented, including

that contained in the prior proposed and final rules in connection with

the establishment of the salable quantities and allotment percentages

for Native and Scotch spearmint oils for the 1993-94 marketing year,

the Committee's recommendation and other available information, it is

found that to revise Sec. 985.212 [58 FR 28340] to change the salable

quantity and allotment percentage for Native spearmint oil, 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 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 final action increases the quantity of Native

spearmint oil that may be marketed immediately; (2) The Committee

recommended this rule at a public meeting and all interested persons

had an opportunity to provide input; (3) Handlers and producers should

be apprised as soon as possible of the salable quantity and allotment

percentage of Native oil contained in this interim final rule; and (4)

This rule provides a 30-day comment period and any comments received

will be considered prior to finalization of this rule.

List of Subjects in 7 CFR Part 985

Marketing agreements, Oils and fats, Reporting and recordkeeping

requirements, Spearmint oil.

For the reasons set forth in the preamble, 7 CFR part 985 is

amended as follows:

PART 985--SPEARMINT OIL PRODUCED IN THE FAR WEST

1. The authority citation for 7 CFR part 985 continues to read as

follows:

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

2. Section 985.212 is amended by revising the introductory text and

paragraph (b) to read as follows:

Note: This section will not appear in the annual Code of Federal

Regulations.

Sec. 985.212 Salable quantities and allotment percentages--1993-94

marketing year.

The salable quantity and allotment percentage for each class of

spearmint oil during the marketing year beginning on June 1, 1993,

shall be as follows:

* * * * *

(b) ``Class 3'' (Native) oil--a salable quantity of 772,611 pounds

and an allotment percentage of 40 percent.

Dated: April 20, 1994.

Robert C. Keeney,

Deputy Director, Fruit and Vegetable Division.

[FR Doc. 94-10224 Filed 4-26-94; 8:45 am]

BILLING CODE 3410-02-P