Karnal Bunt Status of the Mexicali Valley of Mexico

DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection Service

7 CFR Part 319

[Docket No. 97-060-2]

RIN 0579-AA88

Karnal Bunt Status of the Mexicali Valley of Mexico

AGENCY: Animal and Plant Health Inspection Service, USDA.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: We are amending the wheat diseases regulations by recognizing

a wheat-growing area within the Mexicali Valley of Mexico as being free

from the wheat disease Karnal bunt. Surveys conducted by Mexican plant

health authorities in that area of the Mexicali Valley since 1990 have

shown the area to be free from Karnal bunt, and Mexican authorities are

enforcing restrictions designed to protect the area from the

introduction of Karnal bunt. This change will have the effect of

removing certain restrictions on the importation into the United States

of wheat seed, straw, and other wheat products from the Karnal bunt

free area of the Mexicali Valley.

EFFECTIVE DATE: June 8, 1998.

FOR FURTHER INFORMATION CONTACT: Mr. Peter M. Grosser, Senior Import

Specialist, Phytosanitary Issues Management Team, PPQ, APHIS, USDA,

4700 River Road Unit 140, Riverdale, MD 20737-1236; (301) 734-6799; fax

(301) 734-5786; e-mail: [email protected].

SUPPLEMENTARY INFORMATION:

Background

The regulations in ``Subpart--Wheat Diseases'' (7 CFR 319.59

through 319.59-2, referred to below as the regulations) restrict the

importation into the United States of certain seeds, plants, and plant

products from certain countries or localities in order to prevent the

introduction of foreign strains of flag smut and Karnal bunt, two

fungal diseases of wheat (Triticum spp.). Specific provisions relating

to foreign strains of flag smut are located in paragraph (a) of

Sec. 319.59-2 of the regulations, and specific provisions concerning

Karnal bunt are found in paragraph (b) of that section.

Under Sec. 319.59-2(b) of the regulations, wheat seeds, plants,

straw (except straw without heads that has been processed or

manufactured into articles such as decorative wall hangings, clothing,

or toys), chaff, and products of the milling process other than flour

(i.e., bran, thistle sharps, and pollards) are designated as prohibited

articles if they are from Afghanistan, India, Iraq, Mexico, or

Pakistan, which are countries in which Karnal bunt is considered to

exist. Prohibited articles may be imported into the United States only

by the U.S. Department of Agriculture for experimental or scientific

purposes in accordance with Sec. 319.59-2(c).

On January 27, 1998, we published in the Federal Register (63 FR

3844-3848, Docket No. 97-060-1) a proposal to amend the regulations to

recognize a wheat-growing area within the Mexicali Valley of Mexico as

being free from the wheat disease Karnal bunt. We also proposed to make

several other changes in the regulations for the sake of clarity or

accuracy.

We solicited comments concerning our proposal rule for 60 days

ending March 30, 1998. We received 10 comments by that date. The

comments were from farmers, seed companies, a State agriculture agency,

and crop improvement, grain promotion, and grain export associations.

Three of the commenters supported the proposed rule, while the

remaining commenters disagreed with the proposed rule or aspects of its

supporting economic analyses. Their comments are discussed below.

Comment: The proposed rule and its establishment of a pest-free

area for Karnal bunt should not proceed on the grounds that it

perpetuates the idea that Karnal bunt is a pest of quarantine

significance. The proposal is at odds with the widening international

recognition that Karnal bunt should be considered only as a wheat

grading factor and not a quarantine-significant pest.

Response: The position that Karnal bunt is a grading issue rather

than a quarantine issue is one that has been discussed in international

trade and scientific circles. However, given the present international

perception of Karnal bunt as a quarantine issue, we do not believe that

it would serve the interests of American agriculture to unilaterally

remove our regulatory restrictions through which we seek to prevent the

introduction and dissemination of Karnal bunt. Therefore, until such

time as our trading partners view the disease as a grading issue, we

believe that it will be necessary to continue our Karnal bunt-related

regulatory activities and restrictions in order to protect our

international agricultural standing.

With that in mind, APHIS and its partners in the North American

Plant Protection Organization have asked the United Nations Food and

Agriculture Organization (FAO) to coordinate the establishment of

guidelines for addressing minor pests such as Karnal bunt that can

cause significant trade disruptions due to their status as regulated

pests. The FAO has agreed to assume that coordination role and plans to

assemble a panel of scientists to begin work on those guidelines in

June 1998.

Comment: APHIS cannot justify declaring the Mexicali Valley free

from Karnal bunt as long as the Agency continues to regulate adjacent

areas of Arizona and California for the same disease. Given that Karnal

bunt can spread by natural, as well as artificial means, one cannot

expect that the Mexicali Valley could escape inoculation by the disease

during the period that contiguous areas became infected.

Response: We believe that it is indeed possible for the Mexicali

Valley to be declared free of Karnal bunt while a regulatory program

for the same disease remains in place across the border in Arizona and

California. While natural spread can certainly occur, it has been shown

that the greatest risk of spreading Karnal bunt is through artificial

means, especially through the movement of infected seed from one area

to another.

If taking measures to prevent the artificial spread of Karnal bunt

was an inadequate response to the disease, as

[[Page 31098]]

the commenter suggests, then it is logical to assume that the disease

would have spread throughout all the agricultural areas of California,

Arizona, New Mexico, and Texas and beyond, and not just into the

Mexicali Valley. However, APHIS and its State cooperators have been

able to confine Karnal bunt to limited pockets of the wheat-producing

areas of the southwestern United States by restricting the movement of

seed, grain, and regulated articles such as cultivating equipment.

Mexico protects the Mexicali Valley's Karnal bunt free status by

employing similar regulatory strategies to prevent the artificial

spread of Karnal bunt. Additionally, the fact that an international

border lies between the regulated areas in the United States and the

Mexicali Valley helped prevent the spread of Karnal bunt into the

Mexicali Valley by eliminating the influence of factors that played a

role in the spread of Karnal bunt through the southwestern United

States, such as the unrestricted movement of seed, grain, and

cultivating and harvesting equipment.

Comment: The proposed rule appears to be supported by available

data, but we are concerned that APHIS would grant Karnal bunt free

status to the Mexicali Valley while Mexico refuses to apply the same

standards and continues to prohibit the importation of wheat from areas

of California that are outside the Karnal bunt regulated areas in that

State.

Response: The proposed rule and this final rule deal with the

Karnal bunt status of the Mexicali Valley. While we acknowledge that

the U.S. Department of Agriculture is working with Mexican plant health

authorities to resolve their remaining questions regarding the Karnal

bunt status of California, the issue of U.S. wheat exports to Mexico is

outside the scope of this rulemaking. In addition, to maintain

restrictions in light of the area's demonstrated freedom from Karnal

bunt would run counter to our obligations under international trade

agreements.

Comment: We are uncertain as to the intensity of the surveys that

were conducted to establish the Mexicali Valley's Karnal bunt status.

In addition, Karnal bunt may spread into the Mexicali Valley by natural

means despite the Mexican regulatory policies designed to exclude the

disease. Therefore, to ensure the Mexicali Valley remains free from

Karnal bunt, there should be continued testing and review of the

program.

Response: There will be continued monitoring and review of the

Karnal bunt status of the Mexicali Valley as called for by the

commenter. The Mexican plant health regulations establishing the

Mexicali Valley as a Karnal bunt free area require the State-level

plant protection organizations in Baja California and Sonora (the

States in which the free area is located) to cooperate with Mexican

Federal plant protection authorities to establish a yearly sampling

program. Samples must be collected in the field during the growing

season, as well as at grain elevators after harvest, and the samples

must be sent to an officially approved laboratory to be examined for

spores. We believe that the required sampling and testing program,

along with the restriction on the movement into the free area of

articles that present a risk of disseminating Karnal bunt, will serve

to protect the Karnal bunt free status of the Mexicali Valley. In the

event that Karnal bunt is detected in the free area, the Mexican plant

health regulations call for the immediate application of phytosanitary

measures to respond to the situation, at which point APHIS would

suspend imports of wheat from the affected area until the extent of the

outbreak is delimited and a determination is made regarding the Karnal

bunt status of the Mexicali Valley.

Comment: The prohibition on the importation of wheat grown in the

Mexicali Valley should remain in place unless there is ``a long term

continuing rigid inspection that could absolutely guarantee'' the

wheat's freedom from Karnal bunt.

Response: As noted in the response to the previous comment, there

will be a program of continued surveillance and monitoring to ensure

that the Mexicali Valley remains free from Karnal bunt. No inspection

system, however well designed and thorough, could ever ``absolutely

guarantee'' that wheat or any other commodity is free from a pest or

disease. To demand an absolute guarantee from Mexico would be to set a

zero risk standard that cannot be attained by Mexico, the United

States, or any other country that exports agricultural products. If

zero tolerance for pest risk were the standard applied to international

trade in agricultural commodities, it is quite likely that no country

would ever be able to export a fresh agricultural commodity to any

other country. There will always be some degree of pest risk associated

with the movement of agricultural products; APHIS' goal is to reduce

that risk to an insignificant level.

Comment: The economic analysis presented in the proposed rule

assumes that the economic impact of the rule would be spread among all

the wheat growers across the United States, resulting in, at worst, a

loss of about $100 per farm. Because growers in the Mexicali Valley

will almost certainly begin producing durum-variety wheat in order to

compete in the same markets as growers in the southwestern United

States, it is much more likely that the economic impact of the rule

will be felt almost exclusively in the southwestern United States, and

far more acutely than predicted in the economic analysis.

Response: As the commenter has noted, our examination of potential

economic impacts in the proposed rule's economic analysis did not focus

on any particular wheat-producing region in the United States. Rather,

our economic analysis considered the potential effects that the

importation of wheat from the Mexicali Valley could have on the

domestic wheat industry as a whole. We took that broader approach

because the available U.S. and Mexicali Valley wheat production data

did not give us any reason to believe that any particular U.S. wheat-

producing region would be disproportionately affected by the proposed

entry of Mexicali Valley wheat.

The commenter's assertion that the economic impact of the rule will

be felt almost exclusively in the southwestern United States is based

on the presumption that growers in the Mexicali Valley will almost

certainly begin producing durum-variety wheat in order to compete in

the same markets as growers in the southwestern United States. Durum

wheat does indeed account for a large share of wheat production in the

southwestern United States--in 1996, approximately 42 percent of the

wheat produced in Arizona and California was durum wheat, with winter

wheat making up the remaining 58 percent. As noted in the proposed

rule, the 1994 through 1996 averages for wheat class, production share,

and use distribution of Mexicali Valley wheat indicate that durum

variety wheat accounted for an average of only 2.23 percent of Mexicali

Valley wheat production. Although we acknowledge the possibility that

growers in the Mexicali Valley may decide to raise more durum wheat in

order to compete with growers in the southwestern United States, we are

unaware of any market or other incentives that would propel a large-

scale increase in durum production. Therefore, we do not believe that

Mexicali Valley growers will increase their durum production from its

current level of 2.23 percent to the levels envisioned by the

commenter. For that reason, we continue to believe that the economic

analysis presented in the

[[Page 31099]]

proposed rule adequately met its stated purpose of considering the

potential effects on the domestic wheat industry of the importation of

wheat from the Mexicali Valley.

Comment: The economic analysis presented in the proposed rule

states that the total economic cost of wheat production in the United

States averages $155 per acre and compares that to an average total

economic cost of $227.60 to $247.50 in Mexico to reach a conclusion

that the costs of production in the Mexicali Valley are much higher

than in the United States. The actual cost of irrigated production in

the southwestern United States--the area that will likely be impacted

almost exclusively by the rule--is approximately $350 per acre, roughly

$100 higher than Mexicali Valley production costs.

Response: As explained in the response to the previous comment, our

economic analysis was based on available data, and not on the

assumption that declaring the Mexicali Valley to be free from Karnal

bunt would lead growers there to shift their choice of wheat variety

almost exclusively to durum. Further, we could not accurately assess

the costs of U.S. durum wheat production by looking exclusively at the

cost of irrigated production in the southwestern United States. To gain

an appreciation for the costs associated with the production of durum

variety wheat in the United States, we need to consider the Northern

Plains region, where approximately three quarters of U.S.-grown durum

wheat is produced, and on the Pacific region, where the remaining

quarter of U.S.-grown durum wheat is produced.

The average costs of wheat production in the United States were

$154.52, $170.03 and $180.48 per acre in 1994, 1995, and 1996,

respectively, but, as the commenter notes, wheat production costs vary

by region. The production costs in the Northern Plains region, which

includes North Dakota, the largest U.S. producer of durum wheat, were

$143.19 per acre/$4.44 per bushel in 1994, $156.66 per acre/$5.74 per

bushel in 1995, and $168.37 per acre/$6.26 per bushel in 1996. For

those same years, the production costs in the Pacific region, which

includes Arizona and California, were $271.07 per acre/$2.93 per

bushel, $303.19 per acre/$3.31 per bushel, and $344.78 per acre/$3.65

per bushel, respectively. The production costs cited for the Northern

Plains and Pacific regions are the full ownership costs and include the

costs of general farm overhead, capital replacement, and land, as well

as the costs of variable inputs such as seed, fertilizer, labor, etc.

The higher per-acre production costs and lower per-bushel production

costs in the Pacific region are attributable in large measure to the

greater use of irrigation, and the resulting higher yields, in that

region. For 1996, the weighted production cost for all U.S. durum-

producing areas was about $211.86 per acre/$4.86 per bushel.

The 1996 average variable input cost for durum wheat production in

the United States ranged from $1.95 per bushel in the Pacific region to

$3.35 per bushel in the Northern Plains region; the weighted average

cost for the two regions was $3.00 per bushel, compared to $2.47 to

$3.54 per bushel in the Mexicali Valley.

It is important to note that the production costs cited for the

Mexicali Valley in the proposed rule were for variable inputs only and

did not include general farm overhead, capital replacement, and land

costs, which we were unable to obtain, so the full average cost of

production in the Mexicali Valley is actually higher than the figures

cited. As a result, growers in the Mexicali Valley would not enjoy the

$100 per acre production cost advantage envisioned by the commenter. In

the unlikely event that the production share of durum wheat in the

Mexicali Valley increased significantly from its current average of

2.23 percent, we consider that the economic impact of the entry of

Mexicali Valley growers into direct competition with U.S. growers for

the domestic durum wheat market would be minimal.

Therefore, based on the rationale set forth in the proposed rule

and in this document, we are adopting the provisions of the proposal as

a final rule without change.

Effective Date

This is a substantive rule that relieves restrictions and, pursuant

to the provisions of 5 U.S.C. 553, may be made effective less than 30

days after publication in the Federal Register. This rule recognizes a

wheat-growing area in the Mexicali Valley of Mexico as being free from

the wheat disease Karnal bunt. This will eliminate certain restrictions

on the importation into the United States of wheat seed, straw, and

other wheat products from the Karnal bunt free area of the Mexicali

Valley. Therefore, the Administrator of the Animal and Plant Health

Inspection Service has determined that this rule should be effective

upon publication in the Federal Register.

Executive Order 12866 and Regulatory Flexibility Act

This rule has been reviewed under Executive Order 12866. The rule

has been determined to be significant for the purposes of Executive

Order 12866 and, therefore, has been reviewed by the Office of

Management and Budget.

This rule amends the wheat diseases regulations by recognizing a

wheat-growing area within the Mexicali Valley of Mexico as being free

from the wheat disease Karnal bunt. This change is based on surveys

conducted by Mexican plant health authorities in that area of the

Mexicali Valley since 1990 that have shown the area to be free from

Karnal bunt, and on the enforcement by Mexican authorities of

restrictions designed to protect the area from the introduction of

Karnal bunt. This change in the regulations will remove certain

restrictions on the importation into the United States of wheat seed,

straw, and other wheat products from the Karnal bunt free area of the

Mexicali Valley.

This rule primarily affects wheat growers in the United States.

There were 292,464 farms growing wheat in the United States in 1992,

and 96 percent of those farms would be considered small entities.

(According to the standard set by the Small Business Administration for

agricultural producers, a producer with less than $0.5 million annually

in sales qualifies as a small entity.) We have, therefore, examined the

potential economic impact of this rule on small entities, as required

by the Regulatory Flexibility Act, and in doing so, have assessed the

anticipated costs and benefits of this rule, as required by Executive

Order 12866.

The United States produced an average of 2,330 million bushels of

wheat per year between 1992 and 1996. Of this amount, hard red winter

wheat (grown primarily in Kansas, Oklahoma, and Texas) accounted for

about 39 percent of production; hard red spring wheat (grown primarily

in North Dakota, Minnesota, and Montana) accounted for about 24 percent

of production; soft red winter wheat (grown primarily in Missouri,

Illinois, and Ohio) accounted for about 19 percent of production; white

wheat (grown primarily in Washington and Oregon) accounted for about 14

percent of production; and durum wheat (grown primarily in North

Dakota, Arizona, California, and Montana) accounted for about 4 percent

of production.

The United States is a net exporter of wheat, accounting for about

11.4 percent of world wheat production and

[[Page 31100]]

approximately 32 percent of world wheat exports. Of the average 2,330

million bushels of wheat produced per year between 1992 and 1996, an

average of 51 percent of that wheat was exported from the United

States, while wheat imports have accounted for less than 1 percent of

the total U.S. wheat supply in recent years.

Mexico produced an average of about 137 million bushels of wheat

per year between 1994 and 1996, most of which was grown in the States

of Baja California, Guanajuato, Sinaloa, and Sonora. Mexico is a net

importer of wheat, having imported in 1996 an amount of wheat equal to

about 53 percent of production while exporting less than 4 percent of

production; imports made up about 35 percent of Mexico's total wheat

supply in 1996.

The Mexicali Valley is located in two of Mexico's leading wheat-

producing States, Baja California and Sonora. The Mexicali Valley

produced 445,967 metric tons of wheat in 1995; about 53 percent

(236,171 metric tons) of that wheat was shipped to markets elsewhere in

Mexico. Nearly all of the Mexicali Valley's wheat is sown in October

and November and harvested from late May to early July. Table 1 shows

the classes of wheat grown in the Mexicali Valley between 1994 and 1996

and the average production share and use distribution of each class.

Table 1: Wheat Class, Production Share, and Use Distribution of Mexicali Valley Wheat; 1994-1996 Averages

----------------------------------------------------------------------------------------------------------------

Production Use distribution (percent)

Wheat class share ------------------------------------------------------

(percent) Food Feed Seed Other

----------------------------------------------------------------------------------------------------------------

Hard Red Winter............................. 61.3 65 25 3.2 6.8

White....................................... 36.2 61.5 24.6 2.6 11.3

Durum....................................... 2.2 38.5 2.1 58.8 0.6

Soft Red Winter............................. 0.3 33.2 13.9 36 16.9

----------------------------------------------------------------------------------------------------------------

Between 1994 and 1997, producers in the Mexicali Valley shipped an

average of 9 million bushels each year to other markets in Mexico; we

have used that amount in Table 2, below, as an estimate of the total

amount of wheat potentially available for export to U.S. markets.

Table 2: Potential Impact in the United States of the Redirection of Mexicali Valley Wheat to U.S. Markets

(Price Elasticity Is -0.63).

----------------------------------------------------------------------------------------------------------------

Percentage of Mexicali Valley-origin wheat shipments diverted from

other (domestic or export) markets to the U.S. market

---------------------------------------------------------------------

20 40 60 80 100

----------------------------------------------------------------------------------------------------------------

Imports (millions of bushels)............. 1.8 3.6 5.4 7.2 9

Percent change in price................... -0.09 -0.17 -0.27 -.036 -0.45

Percent change in quantity................ -0.04 -0.08 -0.13 -0.17 -0.22

Decrease in producer surplus (millions of

dollars)................................. (5.92) (11.83) (17.75) (23.66) (29.56)

Increase in consumer surplus (millions of

dollars)................................. 5.92 11.84 17.77 23.70 29.64

Total surplus (millions of dollars)....... 0.003 0.0119 0.0268 0.0477 0.0745

----------------------------------------------------------------------------------------------------------------

Table 2 summarizes the estimated economic impacts, based on a price

elasticity of -0.63, in the United States of different levels of wheat

exports from the Mexicali Valley and of the estimated producer losses

and consumer gains that would result. For example, a 20 percent

diversion of Mexicali Valley wheat production from markets in other

countries or the domestic Mexican market to the United States would be

expected to result in a price decrease of 0.09 percent in the United

States. U.S. producers would lose about $5.92 million (which, when

distributed among the 292,464 wheat farms noted above, amounts to about

$20.25 per farm), while consumers would gain about the same amount, for

a net benefit in this scenario of about $3,000. At the other end of the

spectrum, a 100 percent diversion of Mexicali Valley wheat production

from other markets to the United States would be expected to result in

a price decrease of 0.45 percent in the United States. U.S. wheat

producers would lose about $29.56 million (or about $101.00 per farm),

while consumers would gain about $29.64 million, for a net benefit in

this scenario of about $74,500. In all cases, consumer gains slightly

outweigh producer losses.

How likely even a 20 percent diversion of Mexicali Valley wheat to

the U.S. market will be, however, is unclear. The production area of

the Mexicali Valley is closer to markets in the United States than it

is to markets in central Mexico, which means that lower transportation

costs may encourage Mexicali Valley producers to ship their wheat to

the United States. However, the Mexican government is considering a

transportation subsidy for growers in northwestern Mexico to offset the

transportation advantage that growers in central Mexico have in

marketing their crops in Mexico City. Such a subsidy may encourage

Mexicali Valley producers to sell their wheat in Mexico.

Prices for Mexicali Valley wheat may well prove to be a determining

factor with regard to the level of exports, as the costs of production

in the Mexicali Valley are much higher than U.S. production costs. The

cost of Mexicali Valley wheat averaged between $2.47 and $3.54 per

bushel, with total economic costs (which include fertilizers,

irrigation, harvest costs, interest on credit, etc.) ranging between

$227.60 to $247.50 per acre. The cost of wheat grown in the United

States, on the other hand, averaged $2.47 per bushel, with total

economic costs averaging $155 per acre. With its higher production

costs and the added cost of transportation across the border into the

United States, it may prove difficult for

[[Page 31101]]

Mexicali Valley wheat to compete in the U.S. market.

The actual extent of any decrease in wheat prices in the United

States resulting from this rule will depend to a great degree upon the

size of the price elasticity of demand, the magnitude of the change in

supply, and the size of the baseline price. For lower price

elasticities, both losses and gains will be higher. We expect that the

amount of wheat exported from the Mexicali Valley will not be large and

will not, therefore, change wheat production and consumption patterns

in the United States. Further, the increase in wheat supplies in the

United States from an increase in imports from Mexico will likely be

offset to some extent by an increase in exports of wheat from the

United States to Mexico. Nevertheless, allowing the importation of

wheat from the Mexicali Valley will likely have a net positive impact

on the overall economy, since consumer benefits at any level of imports

will be slightly higher than producer losses.

The only significant alternative to this rule was to make no

changes in the wheat diseases regulations, i.e., to continue to

prohibit the importation of wheat and wheat products from Mexico. We

rejected that alternative because we believe that Mexico has

demonstrated that the wheat-growing areas of the Mexicali Valley are

free from Karnal bunt, which means that there is no longer any

biological justification for that area of Mexico to be listed with the

countries and localities considered to be affected with Karnal bunt.

Maintaining a prohibition on the importation of wheat and wheat

products from the Mexicali Valley in light of that area's demonstrated

freedom from Karnal bunt would run counter to the United States'

obligations under international trade agreements and would likely be

challenged through the World Trade Organization. Conversely, declaring

the wheat-growing areas of the Mexicali Valley free from Karnal bunt

will likely have a beneficial effect on international trade in general,

and trade between the United States and Mexico in particular, by

reaffirming the United States' continuing commitment to using

scientifically valid principles as the basis for regulation.

Under these circumstances, the Administrator of the Animal and

Plant Health Inspection Service has determined that this action will

not have a significant economic impact on a substantial number of small

entities.

Executive Order 12988

This rule has been reviewed under Executive Order 12988, Civil

Justice Reform. This rule: (1) Preempts all State and local laws and

regulations that are inconsistent with this rule; (2) has no

retroactive effect; and (3) does not require administrative proceedings

before parties may file suit in court challenging this rule.

Paperwork Reduction Act

In accordance with section 3507(d) of the Paperwork Reduction Act

of 1995 (44 U.S.C. 3501 et seq.), the information collection or

recordkeeping requirements included in this final rule have been

approved by the Office of Management and Budget (OMB). The assigned OMB

control number is 0579-0132.

List of Subjects in 7 CFR Part 319

Bees, Coffee, Cotton, Fruits, Honey, Imports, Incorporation by

reference, Nursery Stock, Plant diseases and pests, Quarantine,

Reporting and recordkeeping requirements, Rice, Vegetables.

Accordingly, we are amending 7 CFR part 319 as follows:

PART 319--FOREIGN QUARANTINE NOTICES

1. The authority citation for part 319 continues to read as

follows:

Authority: 7 U.S.C. 150dd, 150ee, 150ff, 151-167, 450, 2803, and

2809; 21 U.S.C. 136 and 136a; 7 CFR 2.22, 2.80, and 371.2(c).

Sec. 319.8-10 [Amended]

2. In Subpart--Foreign Cotton and Covers, Sec. 319.8-10(d) is

amended by removing the words ``Sec. 319.59 (notice of quarantine No.

59 relating to the flag smut disease)'' and adding the words

``Sec. 319.59-2(a)(2) of this part'' in their place, and footnote 5 and

its reference in the text are removed.

Sec. 319.8-11 [Amended]

3. In Subpart--Foreign Cotton and Covers, Sec. 319.8-11(a), in the

introductory text of the paragraph, footnote 6 and its reference in the

text are redesignated as footnote 5.

Sec. 319.8-17 [Amended]

4. In Subpart--Foreign Cotton and Covers, Sec. 319.8-17(d),

footnote 7 and its reference in the text are redesignated as footnote

6.

5. The authority citation for ``Subpart--Wheat Diseases'' is

removed.

Sec. 319.59 [Amended]

6. In Subpart--Wheat Diseases, Sec. 319.59 is amended as follows:

a. In paragraph (a), in the first sentence, the reference

``Sec. 319.59-2(b)'' is removed and the reference ``Sec. 319.59-2(c)''

is added in its place.

b. In paragraph (a), in the last sentence, the reference

``Sec. 319.59-2(a)'' is removed and the reference ``Sec. 319.59-2 (a)

and (b)'' is added in its place, and the reference ``Sec. 319.59-2(b)''

is removed and the reference ``Sec. 319.59-2(c)'' is added in its

place.

c. In paragraph (b), in the first sentence, the words ``abandoned

by the importer for destruction'' are removed and the words ``destroyed

as deemed necessary by an inspector at the expense of the importer''

are added in their place.

d. In paragraph (b), in the last sentence, the words ``abandoned

for destruction by'' are removed and the words ``destroyed as deemed

necessary by an inspector at the expense of'' are added in their place.

7. In Subpart--Wheat Diseases, Sec. 319.59-2 is amended as follows:

a. In the introductory text of paragraph (a), the words ``in

paragraph (b)'' are removed and the words ``in paragraph (c)'' added in

their place.

b. In paragraph (a)(1)(i), the word ``Triticums'' is removed and

the word ``Triticum'' added in its place.

c. Paragraph (a)(2) is revised to read as set forth below.

d. In paragraph (b)(2), the words ``(except for that portion of the

Mexicali Valley described in paragraph (b)(3) of this section),'' are

added after the word ``Mexico''.

e. A new paragraph (b)(3) is added to read as set forth below.

f. In paragraph (c)(2), the reference ``7 CFR 319.37-14(b)'' is

removed and the reference ``Sec. 319.37-14(b) of this part'' added in

its place.

Sec. 319.59-2 Prohibited articles.

(a) * * *

(2) Afghanistan, Algeria, Armenia, Australia, Azerbaijan,

Bangladesh, Belarus, Bulgaria, Chile, China, Cyprus, Egypt, Estonia,

Falkland Islands, Georgia, Greece, Guatemala, Hungary, India, Iran,

Iraq, Israel, Italy, Japan, Kazakstan, Kyrgyzstan, Latvia, Libya,

Lithuania, Moldova, Morocco, Nepal, North Korea, Oman, Pakistan,

Portugal, Romania, Russia, Spain, Tajikistan, Tanzania, Tunisia,

Turkey, Turkmenistan, South Africa, South Korea, Ukraine, Uzbekistan,

and Venezuela.

(b) * * *

(3) The following area of the Mexicali Valley in Mexico has been

determined to be free from Karnal bunt: Those portions of the

municipality of Mexicali, in the State of Baja California, and the

municipality of San Luis Rio Colorado, in the State of Sonora, that are

included in the Distrito de Desarrollo Rural (Rural Development

District) 002 Rio Colorado.

[[Page 31102]]

Except for wheat (Triticum spp.) plants, which are prohibited

importation under Sec. 319.37-2(a) (see Poaceae) of this part, any

articles described in paragraph (b)(1) of this section that are from

that designated area may be imported into the United States subject to

the following conditions:

(i) The articles are offered for entry at the port of Calexico, CA;

and

(ii) The articles offered for entry are made available for

examination by an inspector and remain at the port until released, or

authorized further movement pending release, by an inspector; and

(iii) The articles are accompanied by a phytosanitary certificate

issued by the Mexican national plant protection organization that

certifies that the articles are from the area of the Mexicali Valley

described in this paragraph and remained within that area prior to and

during their movement to the United States.

* * * * *

8. In Subpart--Packing Materials, Sec. 319.69(b)(1) is revised to

read as follows:

319.69 Notice of quarantine.

* * * * *

(b) * * *

(1) Cereal straw, hulls, and chaff (such as oats, barley, and rye)

from all countries, except rice straw, hulls, and chaff, which are

prohibited importation from all countries by paragraph (a)(1) of this

section, and except wheat straw, hulls, and chaff, which are restricted

importation by Sec. 319.59 of this part from any country or locality

listed in Sec. 319.59-2 of this part.

* * * * *

Done in Washington, DC, this 4th day of June, 1998.

Charles P. Schwalbe,

Acting Administrator, Animal and Plant Health Inspection Service.

[FR Doc. 98-15337 Filed 6-4-98; 3:22 pm]

BILLING CODE 3410-34-P