Milk in the Southwest Plains Marketing Area; Suspension of Certain Provisions of the Order

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1106

[DA-94-08]

Milk in the Southwest Plains Marketing Area; Suspension of

Certain Provisions of the Order

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Suspension of rule.

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SUMMARY: This document suspends, for the months of February 1, 1994

through August 31, 1996, a portion of the supply plant shipping

requirement and the producer delivery requirement of the Southwest

Plains Federal milk marketing order (Order 106). The suspension was

requested by Kraft General Foods (Kraft), which contends the suspension

is necessary to prevent the uneconomical and inefficient movement of

milk and to ensure that producers historically associated with the

market will continue to have their milk pooled under Order 106.

EFFECTIVE DATE: February 1, 1994, through August 31, 1996.

FOR FURTHER INFORMATION CONTACT: Nicholas Memoli, Marketing Specialist,

USDA/AMS/Dairy Division, Order Formulation Branch, Room 2971, South

Building, P.O. Box 96456, Washington, DC 20090-6456, (202) 690-1932.

SUPPLEMENTARY INFORMATION: Prior document in this proceeding:

Notice of Proposed Suspension: Issued February 7, 1994; published

February 14, 1994 (59 FR 6915).

The Regulatory Flexibility Act (5 U.S.C. 601-612) requires the

Agency to examine the impact of a proposed rule on small entities.

Pursuant to 5 U.S.C. 605(b), the Administrator of the Agricultural

Marketing Service has certified that this rule will not have a

significant economic impact on a substantial number of small entities.

This rule lessens the regulatory impact of the order on certain milk

handlers and tends to ensure that dairy farmers will continue to have

their milk priced under the order and thereby receive the benefits that

accrue from such pricing.

The Department is issuing this rule in conformance with Executive

Order 12866.

This final rule has been reviewed under Executive Order 12778,

Civil Justice Reform. This rule is not intended to have a 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 Agricultural Marketing Agreement Act of 1937, as amended (7

U.S.C. 601-674), 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 provisions of the

order, or any obligation imposed in connection with the order is not in

accordance with the law and requesting a modification of an order or to

be exempted from the order. A handler is afforded the opportunity for a

hearing on the petition. After a 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

its 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 the date of the entry of the ruling.

This order of suspension is issued pursuant to the provisions of

the Agricultural Marketing Agreement Act and of the order regulating

the handling of milk in the Southwest Plains marketing area.

Notice of proposed rulemaking was published in the Federal Register

on February 14, 1994 (59 FR 6915) concerning a proposed suspension of

certain provisions of the order. Interested persons were afforded

opportunity to file written data, views, and arguments thereon. One

comment was received in support of the suspension.

After consideration of all relevant material, including the

proposal in the notice, the comment received, and other available

information, it is hereby found and determined that for the months of

February through August of 1994 through 1996, the following provisions

of the order do not tend to effectuate the declared policy of the Act:

1. In Sec. 1106.6, the words ``during the month''.

2. In Sec. 1106.7(b)(1), beginning with the words ``of February

through August'' and continuing to the end of the paragraph.

3. In Sec. 1106.13, paragraph (d)(1) in its entirety.

Statement of Consideration

This suspension order temporarily removes the requirement that

producers ``touch-base'' at a pool plant with at least one day's

production during the month before their milk is eligible for diversion

to a nonpool plant. By suspending the touch-base provision, producer

milk will not be required to be delivered to pool plants before going

to unregulated manufacturing plants.

Additionally, the suspension allows a supply plant that has been

associated with the Southwest Plains order during the months of

September through January of each year to qualify as a pool plant--

without shipping any milk to a pool distributing plant--during the

following months of February through August. Without the suspension, a

supply plant would be required to ship 20 percent of its producer

receipts to pool distributing plants to qualify as a pool plant during

each of the months of February through August.

According to Kraft's letter requesting the suspension, supplemental

milk supplies from supply plants will not be needed to meet the fluid

needs of distributing plants because there will be an adequate supply

of direct-ship producer milk located in the general area of

distributing plants to meet the fluid needs of the market.

Consequently, it states, there is no need to require supply plants to

uneconomically ship milk to distributing plants, nor is there any

reason to require producers located some distance from pool

distributing plants to deliver their milk to those plants simply for

qualifying purposes when it can more economically be diverted directly

to manufacturing plants in the production area.

One comment letter was received in support of the suspension

request; none were received in opposition to it. A letter submitted by

Mid-America Dairymen, Inc. (Mid-Am), stated that Mid-Am and Associated

Milk Producers, Inc., two cooperative associations with a substantial

number of producers on the market, were in support of the action.

A similar suspension of the supply plant shipping requirements and

touch-base requirements has been effective for the past two years

during the months of February through August. In both years, there

were, in fact, adequate supplies of milk within direct-ship distance of

pool distributing plants to meet the fluids needs of the market during

these months. Producer milk deliveries in recent months indicate that a

similar pattern will hold true for 1994.

For the reasons discussed above, it is appropriate to suspend the

touch-base requirement and the specified supply plant shipping

requirements for the months of February through August of 1994 through

1996. This suspension period, while unusually long, will preclude the

necessity of similar suspensions in each of the next two years. In the

event that the market experiences a reduction of direct-ship milk

supplies and a need for supplemental milk from supply plants in 1995 or

1996, the suspended provisions can be easily reinstated by terminating

this suspension order.

It is hereby found and determined that thirty days' notice of the

effective date hereof is impractical, unnecessary, and contrary to the

public interest in that:

(a) The suspension is necessary to reflect current marketing

conditions and to assure orderly marketing conditions in the marketing

area, in that such rule is necessary to permit the continued pooling of

the milk of dairy farmers who have historically supplied the market

without the need for making costly and inefficient movements of milk;

(b) This suspension does not require of persons affected

substantial or extensive preparation prior to the effective date; and

(c) Notice of proposed rulemaking was given interested parties and

they were afforded opportunity to file written data, views or arguments

concerning this suspension.

Therefore, good cause exists for making this order effective less

than 30 days from the date of publication in the Federal Register.

List of Subjects in 7 CFR Part 1106

Milk marketing orders.

For the reasons set forth in the preamble, title 7, part 1106, is

amended as follows effective February 1, 1994, through August 31, 1996:

PART 1106--MILK IN THE SOUTHWEST PLAINS MARKETING AREA

1. The authority citation for 7 CFR part 1106 is revised to read as

follows:

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

Sec. 1106.6 [Suspended in part]

2. In Sec. 1106.6, the words ``during the month'' are suspended.

Sec. 1106.7 [Suspended in part]

3. In Sec. 1106.7(b)(1), the words beginning with ``of February

through August'' and continuing to the end of the paragraph are

suspended.

Sec. 1106.13 [Suspended in part]

4. In Sec. 1106.13, paragraph (d)(1) in its entirety is suspended.

Dated: March 1, 1994.

Patricia Jensen,

Acting Assistant Secretary, Marketing and Inspection Services.

[FR Doc. 94-5489 Filed 3-9-94; 8:45 am]

BILLING CODE 3410-02-P