Nectarines and Peaches Grown in California; Revision of Handling Requirements for Fresh Nectarines and Peaches

SUMMARY: The Department of Agriculture (Department) is adopting as a

final rule, with appropriate modifications, the provisions of an

interim final rule which revised the handling requirements for

California nectarines and peaches by modifying the size, maturity,

container, and pack requirements for fresh shipments of these fruits,

beginning with 1995 season shipments. This rule enabled handlers to

continue shipping fresh nectarines and peaches meeting consumer needs

in the interest of producers, handlers, and consumers of these fruits.

EFFECTIVE DATE: June 12, 1995.

FOR FURTHER INFORMATION CONTACT: Kenneth Johnson, Marketing Specialist,

Marketing Order Administration Branch, Fruit and Vegetable Division,

AMS, USDA, P.O. Box 96456, Room 2523-S, Washington, DC 20090-6456;

telephone: (202) 720-2861; or Terry Vawter, California Marketing Field

Office, Marketing Order Administration Branch, Fruit and Vegetable

Division, AMS, USDA, 2202 Monterey Street, Suite 102B, Fresno,

California, 93721; telephone: (209) 487-5901.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing

Agreement and Marketing Order Nos. 916 and 917 [7 CFR parts 916 and

917] regulating the handling of nectarines and peaches grown in

California, hereinafter referred to as the orders. The orders are

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 is issuing this rule in conformance with Executive

Order 12866.

This rule has been reviewed under Executive Order 12778, 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 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.

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 about 300 California nectarine and peach handlers subject

to regulation under the orders covering nectarines and peaches grown in

California, and about 1,800 producers of these fruits in California.

All of the handlers sell peaches, while three out of four handlers sell

nectarines. Small agricultural service firms have been defined by the

Small Business Administration [13 CFR 121.601] as those whose annual

receipts from all sources are less than $5,000,000 and small

agricultural producers are defined as those whose annual receipts are

less than $500,000. The majority of handlers have sales of less than

$5,000,000 and may be classified as small entities. In recent seasons,

only about ten handlers had combined peach and nectarine sales of

$5,000,000 or more. In recent years, average combined sales of peaches

and nectarines per handler have been about $600,000. Typically, about

three-fourths of peach and nectarine handlers have sales of less than

the average for the industry.

The Nectarine Administrative Committee (NAC) and the Peach

Commodity Committee (PCC) met on December 7, 1994, and unanimously

recommended that the handling requirements for California nectarines

and peaches be revised, respectively. These committees meet prior to

and during each season to review the rules and regulations effective on

a continuous basis for California nectarines and peaches under the

orders. Committee meetings are open to the public, and interested

persons may express their views at these meetings. The Department

reviews committee recommendations and information, as well as

information from other sources, and determines whether modification,

suspension, or termination of the rules and regulations would tend to

effectuate the declared policy of the Act.

Container and Pack Requirements (Nectarines)

Section 916.350 specifies container and pack requirements for fresh

nectarine shipments. Paragraph (a)(4)(iv) of Sec. 916.350 specifies the

tray-pack size designations which must be marked on loose-filled or

tight-filled containers, depending on the size of the fruit. The size

designations specify the maximum number of nectarines in a 16-pound

sample for each tray-pack size designation. This rule revises paragraph

(a)(4)(iv) of Sec. 916.350 by modifying two size designations for the

weight-count standards in Column B of TABLE I for early-season and mid-

season nectarine varieties. This table was added prior to the 1994

season. Research conducted by the NAC indicated that early-season and

mid-season fruit weigh less than late-season fruit and therefore

different weight-count standards were established for late-season

fruit. Results from further research during the 1994 season suggest

that some minor modifications of TABLE I are necessary to provide for

more accurate weight-count standards for early-season and mid-season

nectarines.

The NAC unanimously recommended these revised weight-count

standards for nectarines after a comprehensive review of the

relationships between the tray-pack containers and loose-filled or

tight-filled containers for early-season and mid-season nectarine

varieties. Specifically, the NAC's recommendation provides that the

maximum number of nectarines of size 80 in a 16-pound sample of early-

season and mid-season fruit is more appropriately 75 rather than 76.

Also, the maximum number of nectarines of size 64 in a 16-pound sample

of early-season and mid-season fruit is more appropriately 55 rather

than 56.

Pack regulations provide for uniform packing practices. In

particular, weight- [[Page 30995]] count standards provide for

comparability between fruit packed in loose-filled or tight-filled

containers and fruit packed in tray-pack containers.

According to the NAC, packers occasionally moved fruit from tray-

pack containers to loose-filled or tight-filled containers. This

activity has led to an awareness, in regard to early-season and mid-

season varieties, that fruit which was of proper size when tray-packed

exceeded the maximum number of nectarines for the 16-pound sample for

corresponding loose-filled or tight-filled containers. In some

instances, these samples would need additional pieces of fruit to meet

the 16-pound weight requirement, thus causing the pack to be marked

smaller than its equivalent tray-pack size. When packs are marked with

a smaller size, the container is generally sold for a lower price.

Revised and refined weight-count standards for early-season and mid-

season varieties should provide for more accurate marking of size when

packed in loose-filled or tight-filled containers compared to

equivalent sizes that are tray packed. These regulations provide for

uniformly packed containers of nectarines. The NAC's recommendations

were also thoroughly discussed at a nectarine size subcommittee meeting

held on November 22, 1994, that involved members of the industry and

USDA staff.

Currently, under the marketing order the minimum maturity

requirement for nectarines grown in California is U.S. Mature, which

means that the nectarine has reached the stage of growth which will

insure a proper completion of the ripening process. A higher maturity

standard is defined as California ``Well Matured,'' which is a

condition distinctly more advanced than mature.

This rule adds a definition of ``tree ripe'' to paragraph (b) of

section 916.350. According to the NAC, ``tree ripe'' is an optional

marking without regard to maturity that is stamped on containers of

nectarines. Currently there is no definition of ``tree ripe''. As a

result of inquiries from the industry and the trade, the NAC

recommended defining ``tree ripe'' so that it has a standard meaning.

In the past, there has been no definition of ``tree ripe'' although

fruit boxes marked ``tree ripe'' had to meet the minimum marketing

order maturity standard of U.S. Mature. Handlers have been able to

stamp any maturity level, including U.S. Mature, as ``tree ripe'' due

to a lack of any definition for this nomenclature. The NAC stated that

in some instances, handlers have stamped ``tree ripe'' on every box of

fruit they packed all season. There is growing concern within the

industry that fruit packed at the lower level of acceptable maturity do

not represent what is most commonly perceived as tree ripe. By

requiring that fruit must be at a minimum California Well Matured

maturity standard in order to be marked ``tree ripe'' will help ensure

that buyer expectations are met.

Maturity Requirements (Nectarines)

Section 916.356 specifies maturity requirements for fresh

nectarines in paragraph (a)(1)(i), including TABLE I, for fruit being

inspected and certified as meeting the maturity requirements for ``well

matured'' fruit. Such maturity requirements are based on maturity

measurements which are generally recognized in terms of maturity guides

(e.g., color chips) specified in paragraph (a)(1)(i) and TABLE I of

Sec. 916.356 for nectarines. This rule revises TABLE I of paragraph

(a)(1)(i) of Sec. 916.356 for nectarines to change the maturity guide

for one nectarine variety.

Specifically, a change in color standard was recommended for Alshir

Red from L to J. In a corresponding action, the tolerance for the

Alshir Red variety that states ``except not less than an aggregate area

of 95% of fruit surface shall meet the color standard established for

the variety'' is deleted.

These changes for this nectarine variety are based on a continuing

review of its individual maturity characteristics, and the

identification of the appropriate color chip corresponding to the

``well matured'' level of maturity for such variety.

Size Requirements (Nectarines)

Section 916.356 specifies size requirements for fresh nectarines in

paragraphs (a)(2) through (a)(9). This rule revises Sec. 916.356 to

establish variety-specific size requirements for fourteen nectarine

varieties that were produced in commercially significant quantities of

more than 10,000 packages for the first time during the 1994 season.

Size regulations are put in place to improve fruit quality by

allowing fruit to stay on the tree for a greater length of time which

not only improves maturity and therefore the quality of the product but

also size and increases the number of packed boxes of nectarines per

acre. This provides greater consumer satisfaction, more repeat

purchases and therefore increases returns to growers. Varieties

recommended for specific size regulation have been reviewed and

recommendations are based on the characteristics of the variety to

attain minimum size. Paragraph (a)(4) is revised to include the Arctic

Glo, May Jim, Red Glo, and Royal Glo varieties; and paragraph (a)(6) of

Sec. 916.356 is revised to include the Arctic Queen, How Red, La Pinta,

Red Fred, Royal Red, Ruby Diamond, Spring Bright, Summer Blush, 424-

195, and Nectarine 23 varieties.

This rule also revises Sec. 916.356 to remove six nectarine

varieties from the variety-specific size requirements specified in the

section because less than 5,000 packages of each of these varieties

were produced during the 1994 season. Paragraph (a)(2) of that section

is revised to remove the Aurelio Grand and Maybelle nectarine

varieties; paragraph (a)(4) is revised to remove the Grand Stan

variety; and paragraph (a)(6) is revised to remove the Autumn Grand, Le

Grand, and Super Red nectarine varieties. Nectarine varieties removed

from the nectarine variety-specific list become subject to the non-

listed variety size requirements specified in paragraphs (a)(7),

(a)(8), and (a)(9) of Sec. 916.356.

The NAC recommended these changes in the minimum size requirements

based on a continuing review of the sizing and maturity relationships

for these nectarine varieties, and consumer acceptance levels for

various sizes of fruit. This rule is designed to establish minimum size

requirements for fresh nectarines consistent with expected crop and

market conditions.

This rule also corrects an error in the minimum size requirements

for Royal Glo variety nectarines from size 80 to size 88. The 1995

seasonal regulations list a minimum size of 80 for the Royal Glo

nectarine variety. Royal Glo variety nectarines are an early season

variety and are usually harvested in mid to late May. Nectarines are

assigned minimum sizes, based on the time of harvest and size

characteristics of specific nectarine varieties. Nectarines harvested

in mid to late May are usually smaller, therefore the minimum size 88

category is more responsive to market needs. Based on this criterion,

the Royal Glo variety nectarine should have been in the minimum size 88

category. As such, the reference to the Royal Glo variety nectarine is

added to Sec. 916.356 paragraph (a)(4) and removed from paragraph

(a)(6) under that section.

Container and Pack Requirements (Peaches)

Section 917.442 currently specifies container and pack requirements

for fresh peach shipments. Paragraph (a)(4) (iv) of Sec. 917.442

specifies the tray-pack size designations which must be marked on

loose-filled or tight-filled containers, depending on the size of the

fruit. The [[Page 30996]] size designations specify the maximum number

of peaches in a 16-pound sample for each tray pack size designation.

This rule revises paragraph (a)(4)(iv) of Sec. 917.442 by modifying

three size designations for the weight-count standards in Column B of

TABLE I for early-season and mid-season peach varieties. Research

conducted by the PCC indicated that early-season and mid-season fruit

weighs less than late-season fruit and the weight-count standards were,

therefore, modified based on that consideration. Results from the 1994

season suggest that some minor modifications of TABLE I are necessary

to further correct the weight-count differences between early-season

and mid-season peaches, and late-season peaches.

The PCC unanimously recommended the revised container marking

requirement changes for peaches after a comprehensive review of the

appropriate size pack-count relationships between the tray-pack

containers and loose-filled or tight-filled containers for early-season

and mid-season peach varieties prior to the 1995 season. Specifically,

the PCC's recommendation provides that the maximum number of peaches of

size 84 in a 16-pound sample of early-season and mid-season fruit is

more appropriately 83 rather than 85. Also, the maximum number of

peaches of size 70 in a 16-pound sample of early-season and mid-season

fruit is more appropriately 64 rather than 66. The maximum number of

peaches of size 60 in a 16-pound sample of early-season to mid-season

fruit is more appropriately 50 rather than 47.

In making this revision, a conforming change is required in

Sec. 917.459 (a)(4)(iii) which is referenced in TABLE I. Section

917.459 (a)(4)(iii) currently provides a maximum number of 85 peaches

in a 16-pound sample of early-season and mid-season fruit. This

revision will modify the maximum number of peaches in a 16-pound sample

of early-season and mid-season fruit to 83 pieces of fruit from the

current 85 pieces of fruit.

Pack regulations provide for uniform packing practices. In

particular, weight-count standards provide for equality between packs

of loose-filled or tight-filled sizes to fruit sizes packed in tray-

pack styles. Varieties harvested early in the season and packed in

loose-filled or tight-filled pack styles have had more difficulty being

equal in size to tray-pack style of packing.

According to the PCC, packers occasionally moved fruit from tray-

pack styles of pack to loose-filled or tight-filled pack styles. This

activity has led to an awareness, especially in regard to early-season

varieties, that fruit which was of proper size when tray-packed

exceeded the maximum number of nectarines for the 16-pound sample for

corresponding loose-filled or tight-filled pack size. In some

instances, these samples would need as many as 10 additional pieces of

fruit to meet the 16-pound weight requirement, thus causing the pack to

be ``marked'' smaller than its equivalent tray-pack size. When packs

are ``marked'' smaller this causes the container to be sold for a lower

price. During the 1994 season new weight-count assignments for early

varieties were in place. Research continued with the purpose of

possible refinement of those weight-count assignments.

Revised and refined weight-count standards for early varieties

should provide for more accurate marking size when packed in loose-

filled or tight-filled pack styles compared to equivalent sizes that

are tray packed. These regulations provide for uniformly packed

containers of peaches. The PCC's recommendations were also thoroughly

discussed at a peach size subcommittee meeting held on November 22,

1994, that involved members of the industry and USDA staff.

Currently, under the marketing order the minimum maturity

requirement for peaches grown in California is U.S. Mature, which means

that the peach has reached the stage of growth which will insure a

proper completion of the ripening process. A higher maturity standard

is defined as California ``Well Matured,'' which is a condition

distinctly more advanced than mature.

This rule adds a definition of ``tree ripe'' to section 917.442

paragraph (b). According to the PCC, ``tree ripe'' is an optional

marking without regard to maturity that is stamped on containers of

peaches. Currently there is no definition of ``tree ripe''. As a result

of inquiries from the industry and the trade, the PCC wants to define

``tree ripe'' so that its interpretation is consistent with other

descriptive markings. In the past there has been no definition of tree

ripe although fruit boxes marked ``tree ripe'' had to meet minimum

marketing order standards. Handlers have been able to stamp any

maturity level, including U.S. Mature, as ``tree ripe'' due to a lack

of any definition for this nomenclature. The PCC states that in some

instances in the past, it is known that some handlers have stamped

``tree ripe'' on every box of fruit they packed all season. There is

growing concern among the industry that fruit packed at the lowest

levels of maturity do not represent what is most commonly perceived as

tree ripe. By requiring fruit be at a minimum California ``Well

Matured'' maturity standard in order to be marked ``tree ripe'' will

help ensure that buyer expectations are met.

Maturity Requirements (Peaches)

Section 917.459 specifies maturity requirements for fresh peaches

in paragraphs (a)(1)(i) and (ii), including TABLE I, for fruit being

inspected and certified as meeting the maturity requirements for ``well

matured'' fruit. Such maturity requirements are based on maturity

measurements which are generally recognized in terms of maturity guides

(e.g., color chips) specified in paragraphs (a)(1)(i) and (ii),

including TABLE I of Sec. 917.459 for peaches. This rule revises TABLE

I of paragraph (a)(1)(ii) of Sec. 917.459 for peaches to change the

maturity guide for the David Sun, King's Red, Crimson Lady and Johnny's

White peach varieties. The reference to TABLE I of paragraph (a)(1)(ii)

is a change from the interim final rule which incorrectly cited the

revisions in TABLE I under paragraph (a)(2)(ii).

The SPI recommended these changes for these peach varieties based

on a continuing review of their individual maturity characteristics,

and the identification of the appropriate color chip corresponding to

the ``well matured'' level of maturity for such varieties.

Size Requirements (Peaches)

Section 917.459 specifies size requirements for fresh peaches in

paragraphs (a)(2) through (a)(6), and paragraphs (b) and (c). This rule

revises Sec. 917.459 to establish variety-specific size requirements

for eight peach varieties that were produced in commercially

significant quantities of more than 10,000 packages for the first time

during the 1994 season.

Size regulations are put in place to improve fruit quality by

allowing fruit to stay on the tree for a greater length of time which

not only improves maturity and therefore the quality of the product but

also size and increases the number of packed boxes of peaches per acre.

This provides greater consumer satisfaction, more repeat purchases and

therefore increases returns to growers. Varieties recommended for

specific size regulation have been reviewed and recommendations are

based on the characteristics of the variety to attain minimum size. In

Sec. 917.459 paragraph (a)(5) is revised to include the Snow Brite and

Sugar May peach varieties; and paragraph (a)(6) is revised to include

the August Delight, Autumn [[Page 30997]] Rose, Red Boy, Royal Lady,

September Snow, and Summer Sweet peach varieties.

This rule also revises Sec. 917.459 to remove two peach varieties

from the variety-specific size requirements specified in that section,

because less than 5,000 packages of each of these varieties were

produced during the 1994 season. In Sec. 917.459 paragraph (a)(4) is

revised to remove the Morning Sun peach variety; and paragraph (a)(6)

is revised to remove the Golden Lady peach variety. Peach varieties

removed from the variety-specific list become subject to the non-listed

variety size requirements specified in paragraphs (b) and (c) of

Sec. 917.459.

The removal of the Morning Sun variety from paragraph (a)(4)

results in there being no varieties regulated within size 84 for the

1995 season. Since the variety-specific list is subject to change from

one season to another, the Department wishes to reserve paragraph

number Sec. 916.459 (a)(4) for future regulation of peaches at size 84.

The PCC unanimously recommended these changes in the minimum size

requirements based on a continuing review of the sizing and maturity

relationships for these peach varieties, and the consumer acceptance

levels for various sizes of fruit. This rule is designed to establish

minimum size requirements for fresh peaches consistent with expected

crop and market conditions. This rule reflects the committees' and the

Department's appraisal of the need to revise the handling requirements

for California nectarines and peaches, as specified. The Department's

determination is that this rule will have a beneficial impact on

producers, handlers, and consumers of California nectarines and

peaches.

This rule establishes handling requirements for fresh California

nectarines and peaches consistent with expected crop and market

conditions, and will help ensure that all shipments of these fruits

made each season will meet acceptable handling requirements established

under each of these orders. This rule will also help the California

nectarine and peach industries provide fruit desired by consumers. This

rule is designed to establish and maintain orderly marketing conditions

for these fruits in the interest of producers, handlers, and consumers.

The interim final rule concerning this action was published in the

March 21, 1995, Federal Register (60 FR 14891), with a 30-day comment

period ending April 20, 1995. Two comments were received.

One comment was received from Mr. Jonathan Field, manager of the

NAC and PCC, in support of the committees' recommendations. Another

comment was received from Chief Counsel for Advocacy of the United

States Small Business Administration (SBA). The SBA contended that the

Department failed to follow its own procedures for informal rulemaking

by not publishing the votes on the committees' recommendations. The SBA

further stated that the interim final rule does not relate how the

committees determined what the impact of the rule would be on growers,

handlers and consumers. SBA further stated that the interim final rule

provides no evidence of the impact that these rule changes will have on

small businesses.

In response to the SBA concerns, the Department followed its

informal rulemaking procedures in reviewing the committees'

recommendations. The Department reviewed and considered the information

received from the NAC and PCC as it relates to alternative

recommendations and the impact of this rule on small businesses (i.e.,

growers and handlers).

The Department disagrees with SBA's assertion that the interim

final rule fails to follow the Department's informal rulemaking

procedures and the requirements for the Regulatory Flexibility Act. The

SBA's concerns regarding this action have been properly addressed in

this document and the interim final rule.

The revision of the handling requirements for fresh peaches and

nectarines adopted by this final rule will apply uniformly to all

handlers in the industry, whether small or large, and there are no

known additional costs incurred by small handlers. The stabilizing

effects of the handling regulation impact both small and large handlers

positively by helping them maintain their markets by meeting consumer

demand.

Based on the above, the Administrator of the AMS has determined

that this rule will not have a significant economic impact on a

substantial number of small entities.

After consideration of all relevant matters presented, the

information and recommendations submitted by the committees, and other

information, it is found that the rule, as hereinafter set forth, will

tend to effectuate the declared policy of the Act.

List of Subjects

7 CFR Part 916

Marketing agreements, Nectarines, Reporting and recordkeeping

requirements.

7 CFR Part 917

Marketing agreements, Peaches, Pears, Reporting and recordkeeping

requirements.

For the reasons set forth in the preamble, 7 CFR parts 916 and 917

are amended as follows:

1. The authority citation for 7 CFR parts 916 and 917 continues to

read as follows:

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

PART 916--NECTARINES GROWN IN CALIFORNIA

The interim amendments to 7 CFR part 916 which were published at 60

FR 14891 on March 21, 1995, are adopted as a final rule with the

following change:

Sec. 916.356 [Amended]

2. In Sec. 916.356, paragraph (a)(4) is amended by adding the name

``Royal Glo,'' immediately following the name ``Rose Diamond,'' and

paragraph (a)(6) is amended by removing the name ``Royal Glo,''.

* * * * *

PART 917--FRESH PEARS AND PEACHES GROWN IN CALIFORNIA

The interim amendments to 7 CFR part 917 which were published at 60

FR 14891 on March 21, 1995, are adopted as a final rule with the

following change:

Sec. 917.459 [Corrected]

3. On page 14896, first column, in the amendatory instruction

number 5, the reference to paragraph ``(a)(2)(ii)'' is corrected to

``(a)(1)(ii)'' and in the second column, under paragraph designated

Sec. 917.459, the reference to ``(a)(2)(ii)'' is corrected to read

``(a)(1)(ii)''.

Dated: June 6, 1995.

Sharon Bomer Lauritsen,

Deputy Director, Fruit and Vegetable Division.

[FR Doc. 95-14276 Filed 6-9-95; 8:45 am]

BILLING CODE 3410-02-P