Limes and Avocados Grown in Florida; Relaxation of Container Dimension, Weight, and Marking Requirements

Federal RegisterJul 13, 1998

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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 911 and 915

[Docket No. FV98-911-2 IFR]

Limes and Avocados Grown in Florida; Relaxation of Container

Dimension, Weight, and Marking Requirements

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

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SUMMARY: This rule changes the container requirements prescribed under

the Florida lime and avocado Federal marketing orders. The marketing

orders are administered locally by the Florida Lime Administrative

Committee and the Avocado Administrative Committee (committees). This

rule simplifies container marking requirements for both limes and

avocados by reducing the number of times the size for limes and the

grade for avocados need to appear on a container. This rule also

removes weight limits on lime and avocado containers packed within a

master container, and relaxes certain minimum weight requirements on

containers of avocados. In addition, this rule eliminates specific

container dimension requirements for both limes and avocados, but

maintains net weight requirements. These changes will reduce handling

costs and provide greater flexibility in lime and avocado packing

operations.

DATES: Effective July 14, 1998; comments received by September 11, 1998

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 to the Docket Clerk, Fruit

and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456,

Washington, DC 20090-6456, Fax: (202) 205-6632. 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: William G. Pimental, Marketing

Specialist, Southeast Marketing Field Office, Marketing Order

Administration Branch, F&V, AMS, USDA, P.O. Box 2276, Winter Haven,

Florida 33883; telephone: (941) 299-4770, Fax: (941) 299-5169; or

George Kelhart, Technical Advisor, Marketing Order Administration

Branch, F&V, AMS, USDA, room 2522-S, P.O. Box 96456, Washington, DC

20090-6456; telephone: (202) 720-2491, Fax: (202) 205-6632. Small

businesses may request information on compliance with this regulation

by contacting Jay Guerber, Marketing Order Administration Branch, Fruit

and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456,

Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 205-

6632.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing

Agreement No. 126 and Marketing Order No. 911, both as amended (7 CFR

part 911), regulating the handling of limes grown in Florida, and

Marketing Agreement No. 121 and Marketing Order No. 915, both as

amended (7 CFR part 915), regulating the handling of avocados grown in

Florida, hereinafter referred to as the ``orders.'' The marketing

agreements and 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 of Agriculture (Department) is issuing this rule in

conformance with Executive Order 12866.

This rule has been reviewed under Executive Order 12988, 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 to review the Secretary's

ruling on the petition, provided an action is filed not later than 20

days after the date of the entry of the ruling.

Under the terms of the marketing orders, fresh market shipments of

Florida limes and avocados are required to be inspected and are subject

to grade, size, maturity, and pack and container requirements. Current

pack and container requirements outline the types of information and

the number of times this information needs to appear on a container.

The requirements also list the specific dimensions of the containers in

which the fruit can be packed and the weight restrictions the packed

containers must meet.

This rule makes several changes to the orders' pack and container

rules and regulations. This rule simplifies container marking

requirements for both limes and avocados by reducing the number of

times the size for limes and the grade for avocados need to appear on a

container. In addition, this rule removes net weight limits on lime and

avocado containers packed within a master container, and relaxes

certain minimum net weight requirements on containers of avocados. This

rule also eliminates specific container dimension requirements for both

limes and avocados. These changes will reduce handling costs and

provide greater flexibility in lime and avocado packing operations. The

committees met several times to discuss and recommend changes needed in

the container regulations. The committees met and unanimously

recommended these changes on July 9, 1997, August 13, 1997, and

February 11, 1998.

Section 911.48 and 915.51 of the orders provide the authority to

issue regulations establishing specific pack

[[Page 37476]]

and container requirements for limes and avocados, respectively. These

requirements are specified under sections 911.311, 911.329 and 911.344

for limes, and under sections 915.305 and 915.306 for avocados. These

sections specify, in part, container size, weight, and marking

requirements.

This rule makes several changes to the pack and container

provisions under the orders. The first change reduces the number of

times the size for limes and the grade for avocados need to appear on a

container. Sections 911.311(5)(d) and 915.306(a)(6) of the rules and

regulations outline the container marking requirements for limes for

size and avocados for grade, respectively. Current requirements specify

that the size for limes be marked in letters at least one inch in

height on two sides of the container. For avocados, the grade must be

stamped in letters at least one inch in height on the top and two sides

of the lid. This rule relaxes these requirements by establishing that

containers be stamped only once, anywhere except the bottom of the

container.

The size and grade information on a container is usually applied

automatically by machine, or stamped individually by hand. Each time a

container is stamped, there is an associated cost. The committees

recommended reducing the number of times a container must be stamped,

as well as expanding the possible stamp location, to provide handlers

additional flexibility, and to reduce costs.

The committees believe this change will benefit both large and

small packing operations. Larger operations use automated stamping.

Current stamping requirements mean that each packing line needs to have

at least two in-line stamp rollers or ink jet printers. In cases where

the line has only one stamping device, the containers must be reversed

and run through the line a second time for limes, and three times for

avocados. This can take a considerable amount of time. This change will

allow containers to move more rapidly through the packing line, reduce

the number of stamping machines required, and decrease the costs

associated with these activities.

Most smaller operations stamp the containers by hand. To meet the

current requirements, each box must be rotated and stamped in more than

one location. This increases the time and effort needed to pack each

box. Reducing the number of times a container must be stamped will

decrease the amount of labor needed and the associated stamping costs

required to meet these requirements.

The requirement that containers be stamped more than once with size

or grade information originated from the way limes and avocados were

marketed by retailers in the past. Limes and avocados were, at one

time, marketed and sold out of the containers in which the fruit was

originally packed. Having the information on the container appear in

several locations was done so that the customer could read it. However,

the way limes and avocados are marketed has changed. Rather than being

presented in the shipping container, retailers move the fruit to

display bins.

The stamping of containers with required information benefits the

retailer and helps the committees' check that the lots (shipments) meet

order requirements. Retailers tend to buy in large lots, purchasing a

specified size and grade. The number of times an individual box needs

to be stamped is less important. The committees anticipate that this

change will reduce costs and give handlers additional flexibility under

the rules and regulations. Therefore, the committees recommended

relaxing the stamping requirements for both limes and avocados.

The next change this rule makes is to the weight limits on

individual containers that are packed inside larger master containers.

Sections 911.329(a)(3) and 915.305(b) specify that individual packages

of limes or avocados contained within master containers are not to

exceed four pounds in weight. This rule relaxes this weight limit,

allowing packaged limes or avocados contained within master containers

to exceed four pounds in weight.

The committees are always looking for ways to strengthen and expand

the market for limes and avocados. One way they do this is through the

approval of experimental containers not currently included under the

regulations. This is done for market research purposes. The committees

use such research to determine the benefits and acceptance of different

containers in the marketplace.

The use of master containers packed with limes and avocados in

packages in excess of 4 pounds has been approved on an experimental

basis. The approvals were made to allow handlers to meet specific

requests from their customers.

Consequently, these larger sized packages within a master container

have been shown to have a market potential.

The committees both discussed the merits of eliminating the four

pound limit on packages within a master container. The committees

believe this change will provide handlers with additional marketing

flexibility, increased sales potential, and with more opportunities to

satisfy customers with special needs. Based on the information

collected from the use of the trial containers, the committees

recommended that the four pound limit on packages within a master

container be removed.

This rule also lowers certain minimum net weight requirements for

containers of avocados. Section 915.305 specifies minimum weight

requirements for avocados packed under the marketing order for avocados

grown in Florida. The current regulations specify that avocados be

packed in containers of 8.5, 12\1/2\, 25, 32, or 34 pounds designated

net weights. This rule reduces the net weight requirements of 12\1/2\,

25, 32, and 34 pounds to 12, 24, 31, and 33 pounds, as recommended by

the Avocado Administrative Committee (AAC). AAC members agreed that the

problems prompting this change were more prevalent in the containers

associated with the last four weights. Therefore, no change was

recommended for the 8.5 pound designated net weight.

Handlers use containers that are associated by size with the

minimum weights listed under the rules and regulations. These weight

requirements closely match the capacity of the containers. These

containers are inspected by the Federal-State Inspection Service

(FSIS). One of the things FSIS checks is whether the packed containers

meet the established minimum weight requirements.

An allowable tolerance for variation from the requirements is

specified under the rules and regulations. With respect to each lot of

containers of minimum weights 12\1/2\ and 25 pounds, only 5 percent or

less, by count, of the individual containers in the lot may fail to

meet the applicable specified weight. The tolerance is 10 percent for

minimum weights of 32 and 34 pounds. If the allowable tolerances are

exceeded, the lot fails inspection and would need to be reworked and

repacked before it could meet inspection.

Failing inspection and having to rework a lot after it has been

packed results in a considerable loss of time and money for the

individual handler. One AAC member used the example of a 12\1/2\ pound

net weight container packed with 16 ounce avocados in a single layer

with 12 avocados per layer to illustrate the problem. He said that when

FSIS found the minimum weight to be 8 ounces short in enough boxes to

exceed the tolerance, they would fail the lot, requiring it to be

redone. Handlers then are forced to make a choice between adding an

additional avocado

[[Page 37477]]

to each container, or risk the possibility of failing the minimum net

weight requirement. AAC members concurred with the problem presented by

this particular situation. Several handlers stated that rather than

risk being underweight, they would force an additional avocado into the

container. The handlers agreed that in many cases, this meant that they

were literally giving one avocado per pack away.

In addition, members stated that this practice of over packing the

containers was having a negative effect on the avocados during

shipment. The AAC discussed that some shipments were being received out

of the production area in poor condition due to the over filling of

containers to ensure compliance with the minimum net weight

requirements. The containers were so tightly packed that the avocados

were bruised or damaged in transit.

The AAC understands the benefits of a uniform pack. However, in

this case, the requirements were having a negative effect on the

condition of the avocados. Changing container sizes to better

accommodate the required weights would be difficult and costly.

Handlers have containers in inventory, and have their equipment

adjusted to those containers. By lowering the minimum net weights,

handlers will be able to use the boxes they have. This change will also

reduce the need to add additional avocados to meet net weight

requirements. In addition, it will help reduce the possibility of

containers failing the minimum weight requirement, and save handlers

the expense of reworking failed lots of avocados. This change also will

benefit growers by providing greater packouts and additional grower

revenue. Therefore, the AAC recommended lowering the minimum net

weights of 12\1/2\, 25, 32, and 34 pounds to 12, 24, 31, and 33 pounds

designated net weights. However, this action does not change the

established tolerances or the requirement for a fairly tight pack.

The final change made by this rule is the elimination of specific

container dimension requirements from both orders' rules and

regulations. Current requirements include dimensions for all authorized

containers of limes and avocados, specifying specific measurements for

height, width, and depth. This rule eliminates the specific dimension

constraints, but maintains the container net weight requirements.

Sections 911.329 and 915.305 of the rules and regulations outline

container dimension requirements for limes and avocados, respectively.

These sections establish specific interior dimensions in inches for

containers approved for use under the orders. The dimensions vary from

a small 5.5 pound container with measurements of 7\1/2\ x 11\7/8\ x

4\1/4\ inches to a large 42 pound container with measurements of 12\3/

4\ x 15\1/4\ x 10\3/4\ inches for limes. Avocados also have similar

specific interior dimensions, from a small 8.5 pound container with

dimensions of 16\1/2\ x 13\1/2\ x 3\1/4\ inches to a large 34 pound

container with dimensions of 11 x 16\1/4\ x 10\3/4\ inches.

A recent review of the containers in use throughout the industry

revealed that interior dimensions varied from handler to handler, and

in many cases, were different than those specified in the rules and

regulations. Some of the differences occurred in the box manufacturing

process, where tolerances were granted to allow for equipment

adjustments.

While the dimensions of containers has varied throughout the

industry, the adherence to the net weight requirements has not. Under

current inspection procedures, the containers are being weighed and

checked for compliance with net weight requirements. This means that

even though container dimensions may vary somewhat among individual

handlers, the essential volume among like containers is the same.

Therefore, rather than revising the rules and regulations to

incorporate numerous additional containers with specific dimensions,

the committees voted to eliminate the references to set measurements

while maintaining the container net weight requirements.

The committees concluded that requiring handlers to use containers

with specific dimensions is not necessary as long as the containers

used contain a net weight specified in the requirements. The committees

believe that even with this change, the rules and regulations continue

to promote the shipment of a uniform product. The committees also

anticipate that this change will reduce costs by allowing handlers to

use boxes in inventory, rather than ordering new containers and making

adjustments to equipment. They thought that removing specific container

dimension requirements provided handlers with additional packing

flexibility under the rules and regulations. They also agreed this

change made more sense than trying to add the dimensions of all the

containers currently in use to the requirements. Therefore, the

committees recommended removing the regulations requiring specific

interior dimensions for containers. However, all containers must

continue to meet the specific net weight requirements as they appear in

the rules and regulations.

Section 8e of the Act provides that when certain domestically

produced commodities, including limes and avocados, are regulated under

a Federal marketing order, imports of that commodity must meet the same

or comparable grade, size, quality, and maturity requirements. This

rule changes the container marking and minimum net weight requirements

currently issued under these orders. Therefore, no change is necessary

in the lime or avocado import regulations.

Pursuant to requirements set forth in the Regulatory Flexibility

Act (RFA), AMS has considered the economic impact of this action on

small entities. Accordingly, AMS has prepared this initial regulatory

flexibility analysis.

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 111 lime producers and 141 avocado

producers in the production area and approximately 33 lime handlers and

49 avocado handlers subject to regulation under the marketing orders.

Small agricultural producers have been defined by the Small Business

Administration (SBA) as those having annual receipts less than

$500,000, and small agricultural service firms are defined as those

whose annual receipts are less than $5,000,000 (13 CFR 121.601).

Based on the Florida Agricultural Statistical Service and committee

information, the average on-tree price for fresh limes during the 1996-

97 season was $7.10 per 88 pound box equivalent and shipments totaled

398,279 bushels (55 pound bushel). Approximately 20 percent of all

handlers handled 86 percent of Florida lime shipments.

The average price for fresh avocados during the 1997-98 season was

$14.60 per 55 pound bushel box equivalent for all domestic shipments

and the total shipments were 937,568 bushels. Approximately 10 percent

of all handlers handled 90 percent of Florida avocado shipments. Many

lime and avocado handlers ship other tropical fruit and vegetable

products which are not included in the committees' data but

[[Page 37478]]

would contribute further to handler receipts.

Using these prices, about 90 percent of lime and avocado handlers

could be considered small businesses under the SBA definition and about

10 percent of the handlers could be considered large businesses. The

majority of Florida lime and avocado producers and handlers may be

classified as small entities.

Under Sec. 911.48 and Sec. 915.51 of the marketing orders for limes

and avocados grown in Florida, the committees have the authority to

establish and modify pack and container requirements for limes and

avocados handled under the order. Current pack and container

requirements outline the types of information and the number of times

this information needs to appear on a container. The requirements also

list the specific requirements as to container size and weight

restrictions the packed container must meet.

This rule makes several changes to Secs. 911.311 and 911.329, and

Secs. 915.305 and 915.306 of the rules and regulations concerning the

pack and container requirements for limes and avocados, respectively.

This rule simplifies container marking requirements for both limes and

avocados by reducing the number of times the size for limes and the

grade for avocados need to appear on a container. This rule also

removes net weight limits on lime and avocado containers packed within

a master container, and relaxes certain minimum net weight requirements

on packed avocados. In addition, this rule eliminates specific

container dimension requirements for both limes and avocados. These

changes will reduce handling costs and provide greater flexibility in

lime and avocado packing operations.

This rule will have a positive impact on affected entities. The

changes were recommended to reduce costs and provide additional

flexibility in packing limes and avocados. None of the changes are

expected to increase costs associated with the pack and container

requirements.

The change in the stamping requirement will allow containers to

move more rapidly through the packing line, reduce the number of

stamping machines and labor needed, and decrease costs associated with

complying with the marking requirements.