Kiwifruit Grown in California; Proposed Revision of Inspection Requirements

SUMMARY: This proposed rule would extend the period of validation for

initial inspection certificates issued for California kiwifruit. The

proposed revision would extend the validation period for initial

inspection certificates from December 15 to December 31 or 21 days from

the date of inspection, whichever is later. The current period does not

allow sufficient time between the initial inspection, which may occur

between October and December, and reinspection which must occur after

December 15. This rule would reduce costs to the industry because of

the increase in time between the initial inspection and reinspection.

DATES: Comments must be received by September 25, 1995.

ADDRESSES: Interested persons are invited to submit written comments

concerning this rule. Comments must be submitted in triplicate to the

Docket Clerk, Fruit and Vegetable Division, AMS, USDA, P.O. Box 96456,

Room 2523-S, Washington, DC 20090-6456, or by facsimile at (202) 720-

5698. Comments should reference this 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: Charles L. Rush, Marketing Order

Administration Branch, Fruit and Vegetable Division, AMS, USDA, P.O.

Box 96456, room 2526-S, Washington, DC 20090-6456, telephone (202) 690-

3670; or Rose Aguayo, 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 proposed rule is issued under Marketing

Order No. 920 (7 CFR part 920), as amended, regulating the handling of

kiwifruit grown in California, 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 (Department) is issuing this proposed

rule in conformance with Executive Order 12866.

This proposed rule has been reviewed under Executive Order 12778,

Civil Justice Reform. This action is not intended to have retroactive

effect. This proposed rule would 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

principle 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 rule 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 approximately 65 handlers of California kiwifruit subject

to regulation under the order and approximately 600 kiwifruit producers

in the production area. Small agricultural service firms are defined by

the Small Business Administration (13 CFR 121.601) as those whose

annual receipts are less than $5,000,000, and small agricultural

producers have been defined as those having annual receipts of less

than $500,000. A majority of handlers and producers of California

kiwifruit may be classified as small entities.

This proposal is in accordance with Sec. 920.55(b)of the order.

This section authorizes the committee to establish a period prior to

shipment, when inspections must be performed.

Currently, pursuant to Sec. 920.155 of the marketing order,

certification of any kiwifruit which is inspected and certified as

meeting grade, size, quality, or maturity requirements in effect

pursuant to Sec. 920.52 or Sec. 920.53 during each fiscal year shall be

valid until December 15 of each year or 21 days from the date of

inspection, whichever is later.

The Kiwifruit Administrative Committee (KAC), the agency

responsible for local administration of the marketing order, met on

June 14, 1995, and unanimously recommended revising the current

inspection requirements. The revision would extend the validation

period for the initial inspection certificate, from the current

December 15 expiration date to December 31 of each year.

Kiwifruit grown in California is typically harvested in mid-

October. The fruit is packed shortly after harvest and placed into

storage until shipment. The shipping season generally extends

throughout the year.

About 55 percent of the harvested fruit is inspected as it is being

packed, prior to storage. While the majority of fruit is inspected

prior to storage, some handlers have their fruit inspected after

storage just prior to shipment.

When kiwifruit is stored, a black sooty mold sometimes appears on

the

[[Page 44283]]

fruit's surface. This mold, caused by fruit juice on the surface of the

fruit, usually begins to show after the kiwifruit has been in storage

for over a month. In order to control this problem, a time limit on the

validity of inspection certificates was established. The time limit

initially established in 1985 was valid until January 15 or 21 days

from the date of inspection, whichever was later.

In 1985, it appeared that kiwifruit harvested in October maintained

its quality through the following mid January. However, during the

1988/89 season, problems with black sooty mold once again resulted in

the KAC reevaluating this position, and as a result the date was

changed to December 1, to reduce the likelihood of moldy fruit entering

commercial channels.

Again in 1991, the KAC changed the expiration date for initial

inspection certificates from December 1 to the current expiration date

of December 15. The KAC believed that the December 1 expiration date

required shippers to have their fruit reinspected too soon after the

initial inspection. Shippers who had their fruit inspected closer to

the certificate expiration date of December 1, did not receive the

benefit of 21 days between the initial inspection and reinspection. For

many shippers this was a financial burden.

The current period does not allow sufficient time to determine if

damage from mold may develop. Sufficient time would need to elapse

between the initial inspection, which may occur between October and

December, and reinspection, which occurs after December 15. This

revision would change the current December 15 inspection certificate

expiration date. It would provide that a certificate remains valid

until December 31 or 21 days from the date of inspection, whichever is

later. Thus, the 21-day limitation would be in effect for all inspected

kiwifruit regardless of the date on which it was inspected. This would

mean that kiwifruit inspected and packed less than 21 days prior to

December 31 would not have to be reinspected until 21 days later.

The KAC estimates that, annually, approximately 25 percent of the

crop is reinspected. The reinspection rate is expected to be reduced

slightly by making inspection certificates valid until December 31 or

21 days from the date of inspection. Extending the inspection

certificate validation from December 15 to December 31 is not expected

to have adverse affects on fruit quality.

Over the last five years, the harvest of California kiwifruit has

begun later and later. In years past, the kiwifruit harvest began near

the beginning of October, with a few starting dates recorded in late

September. In recent years, kiwifruit harvests have begun in mid-

October due to natural conditions as well as increased grower

consciousness about fruit maturity. Fruit that is mature tends to have

higher sugar content and is of higher quality. Because of the later

harvest dates, the time lapse from harvest to reinspection has

decreased over the years.

This two-week change to the reinspection date is not expected to

harm the industry's reputation for shipping quality California

kiwifruit. Because of research done in the past five years, California

growers understand the benefits of harvesting kiwifruit with a higher

soluble solids content, which means harvesting at a later date. This,

coupled with natural conditions that have also contributed to a delay

in harvest, have reduced the number of days from harvest until

reinspection.

The KAC also discussed the elimination of reinspection requirements

as an alternative. There is however, strong support throughout the

industry for maintaining reinspection as a means of assuring fruit

quality. The KAC also discussed the use of a sliding reinspection date.

This would allow fruit harvested later to be reinspected at a later

date. However, it was determined that this would present enforcement

problems as it would be difficult to track the harvest date of the

entire California crop. The recommendataion to establish the

reinspection date at December 31 was a compromise agreed to unanimously

by the KAC.

This proposal would adjust the time between harvest and

reinspection. There would be a slight reduction in cost to the industry

due to the additional amount of fruit that would not have to be

reinspected.

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

that this action would not have a significant economic impact on a

substantial number of small entities.

A 30-day comment period is provided to allow interested persons an

opportunity to respond to this proposal. All written comments timely

received will be considered before a final determination is made on

this matter.

List of Subjects in 7 CFR Part 920

Kiwifruit, Marketing agreements.

For the reasons set forth in the preamble, it is proposed that 7

CFR part 920 be amended as follows:

PART 920--KIWIFRUIT GROWN IN CALIFORNIA

1. The authority citation for 7 CFR part 920 continues to read as

follows:

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

2. Section 920.155 is revised to read as follows:

Sec. 920.155 Inspection requirement.

Certification of any kiwifruit which is inspected and certified as

meeting grade, size, quality, or maturity requirements in effect

pursuant to Sec. 920.52 or Sec. 920.53 during each fiscal year shall be

valid until December 31 of such year or 21 days from the date of

inspection, whichever is later.

Dated: August 21, 1995.

Terry C. Long,

Acting Deputy Director, Fruit and Vegetable Division.

[FR Doc. 95-21179 Filed 8-24-95; 8:45 am]

BILLING CODE 3410-02-P