Importation of Tomatoes From France, Morocco and Western Sahara, Chile, and Spain

DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection Service

7 CFR Parts 300 and 319

[Docket No. 97-016-2]

RIN 0579-AA88

Importation of Tomatoes From France, Morocco and Western Sahara,

Chile, and Spain

AGENCY: Animal and Plant Health Inspection Service, USDA.

ACTION: Final rule.

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SUMMARY: We are amending the regulations governing the importation of

fruits and vegetables to allow tomatoes from France, Morocco and

Western Sahara, and Chile to be imported into the United States subject

to certain conditions. This action provides importers and consumers in

the United States with additional sources of tomatoes, while continuing

to provide protection against the introduction and dissemination of

injurious plant pests. We are also amending the regulations pertaining

to importation of tomatoes from Spain by requiring containers of pink

or red tomatoes to be sealed before shipment if the containers will

transit any other fruit fly supporting areas while en route to the

United States, and by requiring records to be kept by Spain's plant

protection service regarding trapping practices and fruit fly captures.

These actions are necessary to prevent the introduction of exotic fruit

flies into the United States.

DATES: This final rule is effective July 22, 1998. The incorporation by

reference of certain publications listed in the regulations is approved

by the Director of the Federal Register as of July 22, 1998.

FOR FURTHER INFORMATION CONTACT: Mr. Ronald C. Campbell, Import

Specialist, Phytosanitary Issues Management Team, PPQ, APHIS, 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 7 CFR 319.56 through 319.56-8 (referred to below

as ``the regulations'') prohibit or restrict the importation of fruits

and vegetables into the United States from certain parts of the world

to prevent the introduction and dissemination of plant pests, including

fruit flies, that are new to or not widely distributed within the

United States.

On October 16, 1997, we published in the Federal Register (62 FR

53761-53769, Docket No. 97-016-1) a proposal to amend the regulations

by allowing fresh tomatoes (Lycopersicon esculentum) to be imported

into the United States from France, Morocco and Western Sahara, and

Chile under specific conditions. We proposed to allow these

importations at the request of various importers and foreign ministries

of agriculture, and after conducting pest risk analyses 1

that indicated the tomatoes could be imported under these conditions

without presenting any significant risk of introducing fruit flies or

other injurious plant pests into the United States. We also proposed to

amend the regulations concerning the importation of tomatoes from Spain

by requiring containers of pink or red tomatoes to be sealed before

shipment if the containers were to transit other fruit-fly supporting

areas en route to the United States and by requiring records to be kept

by Spain's plant protection service regarding trapping practices and

fruit fly captures.

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\1\ Information on these pest risk analyses and any other pest

risk analysis referred to in this document may be obtained by

writing to the person listed under FOR FURTHER INFORMATION CONTACT

or by calling the Plant Protection and Quarantine (PPQ) fax vault at

301-734-3560.

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We solicited comments concerning our proposal for 60 days ending

December 15, 1997. We received seven comments by that date. They were

from representatives of State and foreign governments and producer

organizations, and a university professor. One comment was favorable to

the proposal. The other commenters expressed various concerns about our

proposal, all of which are discussed below.

Comment: The proposal to allow importation of pink tomatoes from

Morocco and Western Sahara does not consider the presence of fruit

flies other than the Mediterranean fruit fly (Medfly). West Africa and

North Africa are home to numerous other fruit fly species. Also, two

moth species, the Old World bollworm or tomato worm, Helicoverpa

armigera (Huber), and the tomato moth, Lacanobia oleracea (L.), could

be transported into Florida on tomatoes from these areas.

Response: We are making no changes to the proposed rule in response

to this comment. With respect to fruit fly species other than Medfly,

our pest risk assessment indicates that tomatoes are not a host to

other fruit fly species found in Morocco and Western Sahara. We believe

that the proposed pest mitigation measures developed for tomatoes from

Morocco and Western Sahara will reduce to an insignificant level the

risk of introducing Medfly and other insect pests, including moth

species, into the United States. Pink tomatoes from Morocco and Western

Sahara will be grown in insect-proof greenhouses where the tomatoes are

protected from insects throughout the growing season. Post-harvest

safeguards required by the rule, including covering of the fruit by a

fruit fly-proof mesh screen or plastic tarpaulin prior to packing, and

packing in fruit fly-proof containers, will continue to protect the

tomatoes from insects.

Additionally, in accordance with Sec. 319.56-6 of the regulations,

all shipments of fruits and vegetables imported into the United States

are inspected at the port of arrival for injurious plant pests. Both

Helicoverpa armigera (Huber) and Lacanobia oleracea (L.) are visually

detectable by inspection. If a shipment of tomatoes from Morocco and

Western Sahara is determined to be infested with either of these pests,

or any other pest of concern, that shipment will either be disinfested

(e.g., cleaned or fumigated), destroyed, or reexported. If a specific

pest continually appears in shipments of tomatoes from Morocco and

Western Sahara, we will consider amending our regulations to require

that measures be taken in Morocco and Western Sahara to mitigate the

presence of that pest.

[[Page 39210]]

Comment: Green tomatoes are authorized entry into the United States

because they are not subject to attacks by Medfly. Therefore, if

tomatoes are loaded in Spain while ``green'' (green or breaker), are

shipped to the United States under controlled conditions, and are

lightly colored upon arrival in the United States, there is no

phytosanitary justification to prohibit entry. The Animal and Plant

Health Inspection Service (APHIS) should, therefore, remove the

requirement that tomatoes be green upon arrival in the United States.

Response: Tomatoes in general are considered poor hosts for Medfly,

and we agree that green tomatoes are not Medfly host material. However,

breaker tomatoes (fruit in the initial stages of ripeness) are hosts,

albeit poor ones. Because green tomatoes are not required to be

safeguarded in any way while in transit to the United States, there is

potential for ripening tomatoes that transit areas where Medfly exists

to become infested. Therefore, we are requiring that green tomatoes be

green upon arrival in the United States as an additional precaution

against infestation. Consequently, we are making no changes to the

proposed rule in response to this comment.

Comment: APHIS states in the preamble to the proposed rule that

tomatoes will be subject to inspection and disinfection at the port of

first arrival as may be required by a United States Department of

Agriculture (USDA) inspector. This means that the regulations do not

explicitly require inspection of imported tomatoes. In other words,

tomatoes may be imported into the United States from Medfly-infested

areas without being inspected by APHIS inspectors. Thus, the risk of

introducing the Medfly and other injurious plant pests into the United

States is much greater than APHIS suggests.

Response: We proposed to allow tomatoes to be imported into the

United States from France, Morocco and Western Sahara, and Chile under

a combination of phytosanitary measures that constitute a framework of

overlapping, redundant safeguards. In the case of tomatoes from France

and Morocco and Western Sahara, where the pest of concern is the

Medfly, these measures include safeguards to protect the tomatoes from

Medfly infestation while they are growing, as well as after harvest. In

the case of tomatoes from Chile, where the primary pests of concern are

the tomato fruit moth and the tomato fruit fly, the measures include

treatment with methyl bromide. These measures would be applied in the

exporting country, and would, in and of themselves, be expected to

reduce the risk of the tomatoes introducing plant pests, including

Medfly, to a negligible level. As an additional precaution, the

tomatoes would be subject to Sec. 319.56-6 of the regulations, which

provides for inspection of all imported fruits and vegetables at the

port of arrival in the United States. While not every piece of imported

fruit or vegetable is examined upon its arrival in the United States, a

certain amount of fruits or vegetables from each shipment is inspected

by USDA inspectors stationed at the ports. The amount inspected is

based on the potential pest risk, including whether there have been

past pest interceptions in similar shipments. In accordance with

Sec. 319.56-6, if an inspector finds evidence of a plant pest on or in

any fruit or vegetable or its container, or finds that the fruit or

vegetable may have been associated with other articles infested with

plant pests, the owner of the produce or the owner's agent must clean

or treat the produce as required by an inspector. The inspector may

require additional inspection, cleaning, and treatment at any time and

place. If an inspector finds that an imported fruit or vegetable is so

infested that, in the judgment of the inspector, it cannot be cleaned

or treated, or if it contains soil or other contaminants, or if it

otherwise fails to meet conditions of the regulations for entry into

the United States, the entire lot will be refused entry. It is our

contention that this combination of safeguards will reduce the risk of

pest introduction, including Medfly introduction, to a negligible

level.

Comment: The pest risk assessments listed a number of pests that

might accompany these shipments of tomatoes from France, Morocco and

Western Sahara, and Chile. The species listed were mostly given a high

rating in terms of pest potential, yet the only mitigation offered is

visual inspection upon arrival. Visual inspection, when suitably and

properly performed will likely find many of these pests. But, these

inspections are not being performed as thoroughly and as often as

necessary, and, the discovery of nymphs or other immature stages that

cannot be clearly identified taxonomically usually results in

nonaction.

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

every shipment of imported fruits and vegetables is inspected at the

port of first arrival. While the number of individual fruits and

vegetables examined in a shipment varies depending upon various factors

related to pest risk (e.g., the types of pests that we would expect to

be associated with the shipment, history of past pest interceptions),

we believe the inspections are adequate to detect pests if they are

present in a shipment. It is not true that no action is taken if a pest

cannot be clearly identified taxonomically. If the life stage of a

pest, or any other factor, prevents an inspector from making an

identification at the port, our policy is to require cleaning or

treatment of the infested commodity, if feasible, or to refuse entry.

Concurrently, unidentified pests are often sent on to USDA

laboratories, and sometimes other Federal laboratories, for positive

identification so that we are aware of any new potential pest risk that

may be associated with similar shipments in the future.

Comment: Increased imports from Medfly-infested areas will increase

the risk of introducing the Medfly and other devastating plant pests

into the United States, which places U.S. agriculture and agricultural

trade in jeopardy. Allowing this increased risk is contrary to APHIS'

obligations under the Federal Plant Pest Act and the Plant Quarantine

Act.

Response: Both the Federal Plant Pest Act and the Plant Quarantine

Act prohibit the movement of articles covered by those Acts, unless the

movement is made in accordance with such regulations as the Secretary

of Agriculture may promulgate to prevent the dissemination of plant

pests into the United States or interstate. As explained earlier in

this document and in the proposed rule, we believe that this rule will

effectively reduce the risk of the introduction of Medfly and other

plant pests into the United States to an insignificant level.

Therefore, we are making no changes to the proposal in response to this

comment.

Comment: There appears to be no way for APHIS to ensure that pink

tomatoes come only from Almeria Province in Spain, El Jadida and Safi

Provinces in Morocco, or Dahkla Province, Western Sahara. Additionally,

the requirement that the tomatoes to be shipped be no more than 30 to

60 percent pink or red is too subjective. Such a standard is subject to

abuse.

Response: Our proposal provided that pink tomatoes may be imported

into the United States from Morocco and Western Sahara only if they are

produced in insect-proof greenhouses in El Jadida and Safi Provinces,

Morocco, or Dahkla Province, Western Sahara, that are registered with

and inspected by the Moroccan Ministry of Agriculture. Additionally, a

phytosanitary certificate will be

[[Page 39211]]

required for tomatoes from Morocco and Western Sahara to ensure the

tomatoes were produced in a registered greenhouse. We believe that this

requirement adequately ensures that pink tomatoes from other areas of

Morocco and Western Sahara will not be exported to the United States.

Similar requirements are already in place for tomatoes from the Almeria

Province of Spain, and there have been no problems. Additionally, the

description of a pink tomato as having a surface area more than 30

percent but not more than 60 percent pink and/or red corresponds to

standard industry color scales for tomato ripeness. Consequently, we do

not expect any confusion about what constitutes a pink tomato eligible

for importation into the United States from Spain, Morocco and Western

Sahara. Therefore, we are making no changes to the proposed rule in

response to this comment.

Comment: Tomatoes from Chile must be treated with methyl bromide in

facilities regulated by the Servicio Agricola y Ganadero (SAG). We

expect the equipment and facilities to be approved and monitored by

APHIS personnel.

Response: The commenter's expectation is correct. In our proposal,

we explicitly stated that the tomatoes must be treated in Chile with

methyl bromide in accordance with the PPQ Treatment Manual, and that

the treatment must be conducted in facilities registered with SAG and

with APHIS personnel monitoring the treatments.

Comment: APHIS states that if the proposed rule is adopted, it will

preempt State and local laws regarding tomatoes imported under this

rule because tomatoes remain in foreign commerce until sold to the

ultimate consumer. The U.S. Customs Service has determined with regard

to tomatoes sold in retail grocery stores that the ultimate consumer is

in fact the retail grocery store and not the retail grocery store

customer. Further, the Suspension Agreement entered into between the

Department of Commerce and the foreign producers and shippers that send

tomatoes to the United States requires that the tomatoes be sold at a

reference price to importers or buyers other than consumers. Thus, it

is incorrect for APHIS to conclude that this order preempts State and

local laws.

Response: The position of the USDA is that fresh fruits and

vegetables imported for immediate sale, such as tomatoes, remain in

foreign commerce until sold to the ultimate consumer. The U.S. Customs

Service, for the purposes of the Tariff Act of 1930, as amended, has

defined ``ultimate purchaser'' for imports from non-North American Free

Trade Agreement countries as ``generally the last person in the United

States who will receive an article in the form in which it is

imported'' (19 CFR 134.1(d)). The Custom Service's position, while not

controlling in USDA's administration of its own statutes, is not

inconsistent with USDA's position. Further, the Suspension Agreement

referenced by the commenter refers to an agreement between the United

States and Mexican tomato growers as to the minimum prices that Mexican

tomato growers can charge for tomatoes exported to the United States.

The agreement arose out of an anti-dumping case and is unrelated to

USDA's determination as to when foreign commerce ceases under the plant

quarantine laws for tomatoes imported from France, Morocco and Western

Sahara, Chile, and Spain.

Comment: The current provisions concerning tomatoes from the

Almeria Province of Spain require Medfly trapping at a rate much higher

than that proposed for Brittany, yet the risk is characterized as

equivalent. Therefore, the trapping requirement should be the same. In

any case, the proposal for just one trap inside and one trap outside

the greenhouse in Brittany does not appear to be adequate. In addition,

there is no mention as to how the two life-cycle time period will be

determined. Will this be based on a specific time interval or a life-

cycle model? And, treatments, where necessary, should continue for two

life-cycles rather than 60 days. It appears that this will be a

requirement for France, but not for Morocco.

Response: We disagree that the risk is equivalent between Almeria

Province, Spain, and the Brittany region of France. Unlike the Almeria

Province of Spain, the climate in Brittany is temperate and not

suitable to support a permanent Medfly population. Medfly does,

however, occur in southern France and could be temporarily introduced

into Brittany during the summer months. Therefore, trapping in France

is a precaution related to the summer months. Trapping inside and

outside each greenhouse in Brittany is adequate due to the fact that

Medfly is not known to occur in Brittany and climatic conditions

prevent the establishment of a permanent population.

Furthermore, the two life-cycle model has not been proposed for

either France or Morocco and Western Sahara, because export decisions

will not be based on true area freedom for Medflies. Requirements that

Malathion bait sprays be applied over a 60-day period when 2 Medflies

are trapped within 200 meters of a registered greenhouse within a 1-

month time period is an additional safeguard for tomatoes from Morocco

and Western Sahara. This provision is one of several overlapping

safeguards in the systems approach that has been developed to ensure

that Medflies and other exotic insect pests do not enter the United

States with tomatoes from Morocco and Western Sahara. It should not be

confused with the two life-cycle model that has been used by APHIS in

other regulations. Therefore, we are making no changes to the proposed

rule in response to this comment.

Comment: The tomato fruit fly, Rhagoletis tomatis, does not occur

in central Chile. Consequently, tomatoes grown between the 4th and 7th

Regions should be enterable into the United States subject only to

methyl bromide fumigation for the tomato fruit moth (Scrobopalpula

absoluta). The 4th through 7th Regions of Chile should be declared a

Rhagoletis tomatis free zone.

Response: Due to the absence of internal controls for transporting

tomatoes between different regions of Chile, we do not believe that the

4th through 7th Regions of Chile should be declared a Rhagoletis

tomatis free zone. Furthermore, declaration of the 4th through 7th

Regions of Chile as Rhagoletis tomatis free would not change any of the

treatment requirements for tomato shipments from Chile to the United

States due to the endemic presence of the tomato fruit moth,

Scrobopalpula absoluta. Therefore, we are making no changes to the

proposed rule in response to this comment.

Comment: The proposed regulations would require tomatoes from Chile

to be treated with methyl bromide and packed within 24 hours of

harvest, then packed in fruit-fly-proof containers for transit to the

airport for shipment to the United States, and all these activities

would have to be conducted under the monitoring of an APHIS inspector.

Because these preclearance activities will be taking place in Chile, we

believe that shipments of tomatoes from Chile should not be subject to

the port-of-arrival inspection requirements of Sec. 319.56-6.

Response: As noted in the response to a previous comment, every

shipment of fruits and vegetables, as a condition of entry into the

United States, is inspected at the port of first arrival in accordance

with Sec. 319.56-6 of the regulations. Although every vegetable or

piece of fruit might not be examined, a certain number of fruits or

vegetables from each shipment is inspected, based on the potential pest

risk. That potential

[[Page 39212]]

risk may be mitigated to a large degree by preclearance measures such

as those required for Chilean tomatoes, but we will not grant a blanket

exemption from port-of-arrival inspection to any commodity on that

basis because of possible infestations en route and the necessity to

spot check to verify that prescribed safeguards are followed.

Therefore, we are making no changes to the proposed rule in response to

this comment.

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 will

facilitate the movement of fresh tomatoes into the United States,

providing additional sources of tomatoes for U.S. importers and

increasing the supply of fresh tomatoes in the U.S. marketplace.

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 the Regulatory Flexibility Act

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

has been determined to be not significant for the purposes of Executive

Order 12866 and, therefore, has not been reviewed by the Office of

Management and Budget.

This rule allows tomatoes from France, Morocco and Western Sahara,

and Chile to be imported into the United States subject to certain

conditions. This action will provide importers and consumers in the

United States with additional sources of tomatoes, while continuing to

provide protection against the introduction and dissemination of

injurious plant pests. This rule also makes some minor changes to the

provisions for importing tomatoes from Spain, but these changes are not

expected to have any effect on the volume of tomatoes imported from

Spain, and, therefore, are not expected to have any economic impact.

Under the Federal Plant Pest Act and the Plant Quarantine Act (7 U.S.C.

150dd, 150ee, 150ff, 151-165, and 167), the Secretary of Agriculture is

authorized to regulate the importation of fruits and vegetables to

prevent the introduction of injurious plant pests.

During 1995 about 12.3 million metric tons of tomatoes were

supplied to the U.S. market. Domestic production accounted for about

95.4 percent of total supply. About 2.1 million metric tons (17

percent) of the total quantity of tomatoes supplied to U.S. consumers

during 1995 were marketed as fresh tomatoes. Imports from Spain

accounted for less than one-tenth of one percent of the total quantity

of tomatoes supplied to U.S. consumers during 1995. Imports from Spain

also accounted for less than one-tenth of one percent of the total

quantity of fresh tomatoes supplied to U.S. consumers during 1995.

Prices and sources of tomatoes supplied to the U.S. market are

summarized in the following table:

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Percent of

Source of U.S. tomato supply Quantity (metric Total value Average value total quantity

tons) ($1,000,000) per metric ton supplied \1\

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Domestic production:

Fresh market............................ 1,489,613 $853.9 $573.20 12.1

Processed market........................ 10,229,601 725.1 70.88 83.3

Imports:

Fresh market............................ 559,117 406.1 725.41 4.6

Processed market........................ ................ ................ .............. ..............

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Total supply............................ 12,278,988 1,985.1 161.77 100.0

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\1\ Percentage column may not sum due to rounding.

Sources: Agricultural Statistics 1995-96; Table 233 (figures converted to metric tons); USDA-NASS; Washington,

DC.

Foreign Agriculture Trade of the United States--FY 1995 Supplement; Table 25; USDA-ERS; Washington, DC.

We estimate that the annual quantity of tomatoes supplied to the

U.S. market will increase by about 13,700 metric tons under this rule.

About 6,000 metric tons are expected from Chile; the remaining 7,700

metric tons will arrive from France and Morocco and Western Sahara.

Tomato imports from Morocco and Western Sahara will be restricted

to arrival during winter months. Imports from Chile and France will be

allowed entry throughout the year. However, Chilean tomatoes are

expected to be imported primarily during the winter months due to

seasonal growing differences between the northern and southern

hemispheres, and shipments from France are likely to fill a special

market niche for high quality fresh tomatoes.

Therefore, imported tomatoes from France, Morocco and Western

Sahara, and Chile will compete primarily with existing imports and

domestic tomatoes produced during the winter months. Price

discrepancies between the import and domestic markets indicate that

imports cannot compete with domestic supplies unless they arrive during

the winter months or for specialty markets. Prices for all tomatoes

supplied to the U.S. market during 1995 averaged about $161.77 per

metric ton. Prices for domestic production averaged about $573.20 per

metric ton for fresh tomatoes and $70.88 per metric ton for processed

tomatoes. By contrast, the value of imported tomatoes averaged $725.41

per metric ton during 1995. Spanish imports, which arrive during the

winter and early spring (December 1 through April 30), averaged $1,695

per metric ton during the same year. This price discrepancy is likely

due to the relatively high quality of winter tomato imports from Spain.

During winter months, there may be some U.S. producers in Florida and

other States who grow field or greenhouse tomatoes at higher than

average prices. However, this price differential is not reflected in

the data. Additionally, published price data for imported tomatoes does

not include shipping costs. If these costs were incorporated into

imported tomato prices, the average price discrepancy between domestic

and imported prices would likely be greater. Specific prices for

imported fresh tomatoes from various countries and regions are

summarized in the following table:

[[Page 39213]]

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Quantity Total value Average value

Source of imported tomatoes (metric tons) (1,000,000) per metric ton

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Canada........................................................ 11,098 $16.1 $1,452.92

Mexico........................................................ 534,345 366.4 685.67

Other Latin America........................................... 53 0.03 525.17

Netherlands................................................... 11,238 18.8 1,674.29

Belgium/Luxembourg............................................ 1,195 1.2 2,166.81

Spain......................................................... 657 1.1 1,695.29

Other Western Europe.......................................... 12 0.02 1,447.61

Asia.......................................................... 1,174 1.0 844.15

Africa........................................................ 2 0.002 1,175.00

Total imports................................................. 559,774 406.1 725.41

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Note: Shipping cost not included. Columns may not sum due to rounding.

Source: Foreign Agriculture Trade of the United States--FY 1995 Supplement; Table 25; USDA-ERS; Washington, DC.

Our economic analysis first estimated the potential impact of this

rule on total U.S. tomato production and then estimated the potential

impact on U.S. production of fresh tomatoes.

The estimated impact on total tomato production was determined by

assuming that all of the increase in imports expected as a result of

this rule were directly substitutable for domestic supplies. In that

case, domestic producers could experience a decline in tomato prices

from $161.77 per metric ton to $161.45 per metric ton, or $0.32 per

metric ton. This estimate assumes a perfectly inelastic supply, a

demand elasticity of -0.5584 2, an initial quantity supplied

of 12.3 million metric tons, and an increase in imports of 13,700

metric tons. This price decrease would result in a total revenue

decrease for U.S. producers of $3,929,277, or about 0.2 percent of the

total value of domestic tomato production. The price decrease would

increase consumer welfare by $3,931,469, resulting in a positive,

albeit small, net impact to U.S. society totaling about $2,192. Foreign

producers would realize a gain of about $2,211,865.

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\2\ The demand elasticity is obtained from J.E. Epperson and

L.F. Lei, ``A Regional Analysis of Vegetable Production with

Changing Demand for Row Crops Using Quadratic Programming,''

Southern Journal of Agricultural Economics, Volume 21, Number 1,

July 1989, pp. 87-96.

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If the impact were restricted to the fresh market, domestic

producers could experience a decline in fresh tomato prices from

$614.76 per metric ton to $607.40 per metric ton, or $7.36 per metric

ton. This estimate assumes a perfectly inelastic supply, a demand

elasticity of -0.55842 2, an initial quantity supplied of

2.1 million metric tons, and an increase in imports of 13,700 metric

tons. This price decrease would result in a total revenue decrease for

U.S. fresh tomato producers of $15,083,488, or about 1.8 percent of the

total value of domestic fresh tomato production. The price decrease

would increase consumer welfare by $15,133,904, resulting in a positive

net impact to U.S. society totaling about $50,416. Foreign producers

would realize a gain of about $8,321,380. Estimated welfare impacts for

both the entire and fresh U.S. tomato markets are summarized in the

following table:

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U.S. consumer U.S. producer Net gain to Foreign

U.S. tomato market gain revenue loss U.S. society producer gain

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

Entire market 1................................. $3,931,469 $3,929,277 $2,192 $2,207,070

Fresh market.................................... 15,133,904 15,083,488 50,416 8,321,380

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\1\ Includes all tomatoes consumed in both the processed and fresh markets.

In summary, this rule will provide U.S. consumers with additional

sources of tomatoes during winter months and for specialty markets.

Domestic producers who propagate field or greenhouse tomatoes during

the winter months may be slightly affected. However, the relatively low

volume of expected imports (13,700 metric tons with a maximum value of

$8.3 million) is unlikely to significantly erode the market share of

domestic producers.

The Regulatory Flexibility Act requires that APHIS specifically

consider the economic impact of this rule on ``small'' entities. The

SBA has set forth size criteria by Standard Industrial Classification

(SIC), which were used as a guide in determining which economic

entities meet the definition of a ``small'' business.

The SBA does not maintain specific size standards for domestic

entities that either import or produce tomatoes. Therefore, this

analysis uses the size standards established for Vegetable and Melon

Producers (SIC code 0161) and Wholesale Traders of Fresh Fruits and

Vegetables (SIC code 5148). The SBA's definition of a ``small'' entity

included in the vegetable and melon producer classification is one that

generates less than $500,000 in annual receipts.3 Wholesale

traders of fresh fruits and vegetables are classified as ``small'' if

they employ fewer than 100 people.

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\3\ Small Business Administration; Washington, DC. SBA data was

modified by tomato specific information contained in the 1992 Census

of Agriculture.

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Currently there are about 15,438 ``small'' fruit and vegetable

producers and 5,122 ``small'' wholesale traders of fresh fruits and

vegetables, according to the SBA criteria. The rule could negligibly

impact some ``small'' domestic entities. However, because the supply of

tomatoes in the U.S. market will only increase by about 13,700 metric

tons (less than one-tenth of one percent of total domestic supply) and

domestic producers will continue to supply more than 95 percent of the

tomatoes consumed in the United States each year, it does not appear

that this rule will have a significant economic impact on a substantial

number of small entities.

We solicited comments in our proposed rule on our Initial

Regulatory Flexibility Analysis. We received several, which are

discussed below.

[[Page 39214]]

Comment: These imports will compete directly with tomatoes produced

in Florida. APHIS states that tomatoes produced in the fall and winter

months are the off season, but this is not the off season for tomatoes

produced in Florida. APHIS needs to specifically address potential

impacts on Florida's winter tomato industry. Additionally, APHIS finds

that even if tomatoes compete with domestically-produced tomatoes, the

impact will be marginal due to the low volume of imports. We disagree

with this conclusion as well because even a small increase in imports

can have a large impact on the price of fresh tomatoes. Fresh tomatoes

are extremely price-sensitive.

Response: We acknowledge that tomatoes imported from France,

Morocco and Western Sahara, and Chile will compete with tomatoes

produced during the winter in Florida and other States. We also

acknowledge that fresh tomato prices are price sensitive. When

potential economic impacts are restricted to the fresh tomato market,

U.S. producers would likely incur a revenue loss of $15.1 million as a

result of this rule change. This accounts for about 1.8 percent of the

total annual value of fresh tomatoes supplied to U.S. consumers.

Florida producers produced about 344,105 metric tons of fresh

tomatoes between December 1995 and April 1996. This accounted for about

54 percent of Florida's total annual harvest and about 16.8 percent of

total fresh tomatoes supplied to the U.S. market during that period.

The average price for Florida winter tomatoes between December 1995 and

April 1996 was about $703.55 per metric ton. For this reason, it is

likely that competition between imported and Florida grown tomatoes

would be fairly limited due to the relatively large price discrepancy

that exists between foreign and domestic markets. As previously

mentioned, imported tomatoes are likely to fill a special market niche

rather than substitute for domestic supply.

Comment: We question APHIS' use of SBA size standards established

for melon and vegetable producers, and the conclusions reached using

that data, in its Regulatory Flexibility Analysis for the proposed

rule. Further, we dispute APHIS' statement that 95 percent of tomatoes

marketed in the United States are produced domestically and the

conclusions reached based on that figure.

Response: As explained above, we used size standards published by

the SBA for Melon and Vegetable Producers (SIC code 0161) and Wholesale

Traders of Fresh Fruits and Vegetables (SIC code 5148)--which include

producers and wholesale traders of tomatoes--because the SBA does not

maintain separate size standards that are specific to tomato producers

or wholesale traders of tomatoes. We are not aware of any other

published size standards for domestic tomato producers or wholesale

traders of tomatoes, and the commenter did not offer any such

information. Similarly, the commenter did not provide any supporting

information or alternative figures when disputing the proposed rule's

statement that 95 percent of the U.S. tomato supply is produced

domestically. As noted in the proposed rule, we obtained that 95

percent figure from data published annually in USDA'S ``Agricultural

Statistics'' and ``Foreign Agricultural Trade of the United States.''

Comment: There are several more current elasticity estimates that

could be used for the economic analysis. Spreen et al. used a price

flexibility of roughly -0.28 to estimate the impact of losing methyl

bromide for the Florida vegetable industry (Spreen et al., ``Use of

Methyl Bromide and the Economic Impact of Its Proposed Ban on the

Florida Fresh Fruit and Vegetable Industry.'' University of Florida Ag.

Exp. Sta. Bull. 898, 1995). Using that flexibility and the assumptions

in the Initial Regulatory Flexibility Analysis for the proposed rule,

the economic impact increases to more than $6.1 million. While this may

pale in comparison to the overall U.S. industry, these increased

imports concentrated on the winter fresh tomato industry could have

more significant impacts. This is especially true noting the

sensitivity of this industry to increased imports because of the recent

anti-dumping case resolved by the suspension agreement signed by

Mexican producers with the U.S. Government. These increased imports not

only jeopardize the economic health of U.S. producers, but also

jeopardize the suspension agreement with Mexico that suspended the

anti-dumping case taken to the U.S. Department of Commerce and U.S.

International Trade Commission.

Response: We agree that use of a different elasticity measurement

would change the estimated net economic impact. The literature includes

many examples of tomato elasticities and price flexibilities that have

been calculated for specific States, regions, or seasons. The demand

elasticity used in this analysis was originally developed to calculate

potential economic impacts on a national scale and was, therefore,

appropriate for this analysis.

Furthermore, the suspension agreement referenced by the commenter

refers to an agreement between the United States and Mexican tomato

growers as to the minimum prices that Mexican tomato growers can charge

for tomatoes exported to the United States. The agreement arose out of

an anti-dumping case and is not related to tomato imports from France,

Morocco and Western Sahara, and Chile.

Comment: APHIS stated that tomatoes from France will fill a special

market for higher quality fresh tomatoes. There is no basis in the

record that tomatoes from France are higher quality tomatoes. Further,

there is nothing in the record that indicates consumers want an

additional source of tomatoes.

Response: The statement referred to by the commenter appeared in

the Initial Regulatory Flexibility Analysis for the proposed rule. We

said that tomatoes from France will be allowed entry throughout the

year and that * * * ``shipments from France are likely to fill a

special market niche (for higher quality fresh tomatoes).'' That

statement was merely an explanation of how the French tomatoes may be

marketed. This rulemaking is not based on either the quality of the

potential imports or the demand for them. It only removes a regulatory

barrier that does not appear necessary from a pest risk perspective.

Other issues are beyond the scope of this rulemaking.

Comment: This proposed rule will harm U.S. producers who are still

suffering from losses in excess of $750 million due to increased tomato

imports from Mexico. The U.S. Department of Commerce found that

tomatoes from Mexico were unfairly dumped into the U.S. market.

Response: Our economic analysis indicates that U.S. tomato

producers could experience a revenue decrease of about $3.9 million.

This accounts for about 0.2 percent of the annual value of U.S. tomato

production. Specific impacts related to tomato imports from Mexico are

not relevant to this rulemaking.

Executive Order 12988

This rule allows the importation of tomatoes from France, Morocco

and Western Sahara, and Chile under certain conditions. State and local

laws and regulations regarding tomatoes imported under this rule will

be preempted while the fruit is in foreign commerce. Tomatoes are

generally imported for immediate distribution and sale to the consuming

public, and will remain in foreign commerce until sold to the ultimate

consumer. The question of when foreign commerce ceases in other

[[Page 39215]]

cases must be addressed on a case-by-case basis. No retroactive effect

will be given to this rule, and this rule will not require

administrative proceedings before parties may file suit in court

challenging this rule.

National Environmental Policy Act

An environmental assessment and finding of no significant impact

have been prepared for this rule. The assessment provides a basis for

the conclusion that the importation of tomatoes from France, Morocco

and Western Sahara, and Chile will not present a risk of introducing or

disseminating plant pests and will not have a significant impact on the

quality of the human environment. Based on the finding of no

significant impact, the Administrator of the Animal and Plant Health

Inspection Service has determined that an environmental impact

statement need not be prepared.

The environmental assessment and finding of no significant impact

were prepared in accordance with: (1) The National Environmental Policy

Act of 1969 (NEPA) (42 U.S.C. 4321 et seq.), (2) Regulations of the

Council on Environmental Quality for implementing the procedural

provisions of NEPA (40 CFR parts 1500-1508), (3) USDA regulations

implementing NEPA (7 CFR part 1b), and (4) APHIS' NEPA Implementing

Procedures (7 CFR part 372).

Copies of the environmental assessment and finding of no

significant impact are available for public inspection at USDA, room

1141, South Building, 14th Street and Independence Avenue SW.,

Washington, DC, between 8 a.m. and 4:30 p.m., Monday through Friday,

except holidays. Persons wishing to inspect copies are requested to

call ahead on (202) 690-2817 to facilitate entry into the reading room.

In addition, copies may be obtained by writing to the individual listed

under FOR FURTHER INFORMATION CONTACT.

Paperwork Reduction Act

In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.

3501 et seq.), the information collection or recordkeeping requirements

included in this rule have been approved by the Office of Management

and Budget (OMB) under OMB control number 0579-0131.

List of Subjects

7 CFR Part 300

Incorporation by reference, Plant diseases and pests, Quarantine.

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, and Vegetables.

Accordingly, title 7, chapter III, of the Code of Federal

Regulations is amended as follows:

PART 300--INCORPORATION BY REFERENCE

1. The authority citation for part 300 continues to read as

follows:

Authority: 7 U.S.C. 150ee, 154, 161, 162, and 167; 7 CFR 2.22,

2.80, and 371.2(c).

2. In Sec. 300.1, paragraph (a), introductory text, is revised to

read as follows:

Sec. 300.1 Materials incorporated by reference.

(a) Plant Protection and Quarantine Treatment Manual. The Plant

Protection and Quarantine Treatment Manual, which was reprinted

November 30, 1992, and includes all revisions through June 1998, has

been approved for incorporation by reference in 7 CFR chapter III by

the Director of the Office of the Federal Register in accordance with 5

U.S.C. 552(a) and 1 CFR part 51.

* * * * *

PART 319--FOREIGN QUARANTINE NOTICES

3. 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).

4. In Sec. 319.56-2t, the table is amended by revising the entry

for Spain and by adding new entries for France and Morocco and Western

Sahara, in alphabetical order, to read as follows:

Sec. 319.56-2t Administrative instructions: conditions governing the

entry of certain fruits and vegetables.

* * * * *

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

Country/locality Common name Botanical name Plant part(s)

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

* * * * * *

*

France......................... Tomato.................... (Lycopersicon Fruit, only if it is green upon

esculentum). arrival in the United States

(pink or red fruit may only be

imported from the Region of

Brittany and only in accordance

with Sec. 319.56-2dd of this

subpart).

* * * * * *

*

Morocco and Western Sahara..... Tomato.................... (Lycopersicon Fruit, only if it is green upon

esculentum). arrival in the United States

(pink fruit may only be

imported from the El Jadida or

Safi Province, Morocco, or

Dahkla Province, Western

Sahara, and only in accordance

with Sec. 319.56-2dd of this

subpart).

* * * * * *

*

Spain.......................... Tomato.................... (Lycopersicon Fruit, only if it is green upon

esculentum). arrival in the United States

(pink or red fruit may only be

imported from Almeria Province

and only in accordance with

Sec. 319.56-2dd of this

subpart).

* * * * * *

*

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

[[Page 39216]]

* * * * *

5. Section 319.56-2dd is revised to read as follows:

Sec. 319.56-2dd Administrative instructions: conditions governing the

entry of tomatoes.

(a) Tomatoes (fruit) (Lycopersicon esculentum) from Spain. Pink or

red tomatoes may be imported into the United States from Spain only

under the following conditions: 1

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

\1\ The surface area of a pink tomato is more than 30 percent

but not more than 60 percent pink and/or red. The surface area of a

red tomato is more than 60 percent pink and/or red. Green tomatoes

may be imported in accordance with Sec. 319.56-2t of this subpart.

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

(1) The tomatoes must be grown in the Almeria Province of Spain in

greenhouses registered with, and inspected by, the Spanish Ministry of

Agriculture, Fisheries, and Food (MAFF);

(2) The tomatoes may be shipped only from December 1 through April

30, inclusive;

(3) Two months prior to shipping, and continuing through April 30,

MAFF must set and maintain Mediterranean fruit fly (Medfly) traps

baited with trimedlure inside the greenhouses at a rate of four traps

per hectare. In all areas outside the greenhouses and within 8

kilometers, including urban and residential areas, MAFF must place

Medfly traps at a rate of four traps per square kilometer. All traps

must be checked every 7 days;

(4) Capture of a single Medfly in a registered greenhouse will

immediately result in cancellation of exports from that greenhouse

until the source of infestation is determined, the Medfly infestation

is eradicated, and measures are taken to preclude any future

infestation. Capture of a single Medfly within 2 kilometers of a

registered greenhouse will necessitate increasing trap density in order

to determine whether there is a reproducing population in the area.

Capture of two Medflies within 2 kilometers of a registered greenhouse

and within a 1-month time period will result in cancellation of exports

from all registered greenhouses within 2 kilometers of the find until

the source of infestation is determined and the Medfly infestation is

eradicated;

(5) MAFF must maintain records of trap placement, checking of

traps, and any Medfly captures, and must make the records available to

APHIS upon request;

(6) The tomatoes must be packed within 24 hours of harvest. They

must be safeguarded by a fruit fly-proof mesh screen or plastic

tarpaulin while in transit to the packing house and while awaiting

packing, and packed in fruit fly-proof containers for transit to the

airport and subsequent shipping to the United States. Transit through

other fruit fly supporting areas is prohibited unless the fruit fly-

proof containers are sealed by MAFF before shipment and the official

seal number is recorded on the phytosanitary certificate; and

(7) MAFF is responsible for export certification inspection and

issuance of phytosanitary certificates. Each shipment of tomatoes must

be accompanied by a phytosanitary certificate issued by MAFF and

bearing the declaration, ``These tomatoes were grown in registered

greenhouses in Almeria Province in Spain.''

(b) Tomatoes (fruit) (Lycopersicon esculentum) from France. Pink or

red tomatoes may be imported into the United States from France only

under the following conditions: 2

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

\2\ See footnote 1 in paragraph (a) of this section.

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

(1) The tomatoes must be grown in the Brittany Region of France in

greenhouses registered with, and inspected by, the Service de la

Protection Vegetaux (SRPV);

(2) From June 1 through September 30, SRPV must set and maintain

one Medfly trap baited with trimedlure inside and one outside each

greenhouse and must check the traps every 7 days;

(3) Capture of a single Medfly inside or outside a registered

greenhouse will immediately result in cancellation of exports from that

greenhouse until the source of the infestation is determined, the

Medfly infestation is eradicated, and measures are taken to preclude

any future infestation;

(4) SRPV must maintain records of trap placement, checking of

traps, and any Medfly captures, and must make them available to APHIS

upon request;

(5) From June 1 through September 30, the tomatoes must be packed

within 24 hours of harvest. They must be safeguarded by fruit fly-proof

mesh screen or plastic tarpaulin while in transit to the packing house

and while awaiting packing, and be packed in fruit fly-proof containers

for transit to the airport and subsequent shipping to the United

States. At all times of the year, transit through other fruit fly

supporting areas is prohibited unless the fruit fly-proof containers

are sealed by SRPV before shipment and the official seal number is

recorded on the phytosanitary certificate; and

(6) SRPV is responsible for export certification inspection and

issuance of phytosanitary certificates. Each shipment of tomatoes must

be accompanied by a phytosanitary certificate issued by SRPV and

bearing the declaration, ``These tomatoes were grown in registered

greenhouses in the Brittany Region of France.''

(c) Tomatoes (fruit) (Lycopersicon esculentum) from Morocco and

Western Sahara. Pink tomatoes may be imported into the United States

from Morocco and Western Sahara only under the following conditions:

3

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

\3\ See footnote 1 in paragraph (a) of this section.

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

(1) The tomatoes must be grown in the provinces of El Jadida or

Safi in Morocco or in the province of Dahkla in Western Sahara in

insect-proof greenhouses registered with, and inspected by, the

Moroccan Ministry of Agriculture, Division of Plant Protection,

Inspection, and Enforcement (DPVCTRF);

(2) The tomatoes may be shipped from Morocco and Western Sahara

only between December 1 and April 30, inclusive;

(3) Beginning 2 months prior to the start of the shipping season

and continuing through the end of the shipping season, DPVCTRF must set

and maintain Mediterranean fruit fly (Medfly) traps baited with

trimedlure inside the greenhouses at a rate of four traps per hectare.

In Morocco, traps must also be placed outside registered greenhouses

within a 2 kilometer radius at a rate of four traps per square

kilometer. In Western Sahara, a single trap must be placed outside in

the immediate proximity of each registered greenhouse. All traps in

Morocco and Western Sahara must be checked every 7 days;

(4) DPVCTRF must maintain records of trap placement, checking of

traps, and any Medfly captures, and make the records available to APHIS

upon request;

(5) Capture of a single Medfly in a registered greenhouse will

immediately result in cancellation of exports from that greenhouse

until the source of the infestation is determined, the Medfly

infestation has been eradicated, and measures are taken to preclude any

future infestation. Capture of a single Medfly within 200 meters of a

registered greenhouse will necessitate increasing trap density in order

to determine whether there is a reproducing population in the area. Six

additional traps must be placed within a radius of 200 meters

surrounding the trap where the Medfly was captured. Capture of 2

Medflies within 200 meters of a registered greenhouse and within a 1-

month time period will necessitate Malathion bait sprays in the area

every 7 to 10 days for 60 days to ensure eradication;

[[Page 39217]]

(6) The tomatoes must be packed within 24 hours of harvest. They

must be safeguarded by a fruit fly-proof mesh screen or plastic

tarpaulin while in transit to the packing house and while awaiting

packing, and packed in fruit fly-proof containers for transit to the

airport and subsequent shipping to the United States. The tomatoes must

be pink at the time of packing. Transit through other fruit fly

supporting areas is prohibited unless the fruit fly-proof containers

are sealed by the Moroccan Ministry of Agriculture, Fresh Product

Export (EACCE), before shipment and the official seal number is

recorded on the phytosanitary certificate; and

(7) EACCE is responsible for export certification inspection and

issuance of phytosanitary certificates. Each shipment of tomatoes must

be accompanied by a phytosanitary certificate issued by EACCE and

bearing the declaration, ``These tomatoes were grown in registered

greenhouses in El Jadida or Safi Province, Morocco, and were pink at

the time of packing'' or ``These tomatoes were grown in registered

greenhouses in Dahkla Province, Western Sahara and were pink at the

time of packing.''

(d) Tomatoes from Chile. Tomatoes (fruit) (Lycopersicon esculentum)

from Chile, whether green or at any stage of ripeness, may be imported

into the United States only under the following conditions:

(1) The tomatoes must be treated in Chile with methyl bromide in

accordance with the PPQ Treatment Manual, which is incorporated by

reference at Sec. 300.1 of this chapter. The treatment must be

conducted in facilities registered with the Servicio Agricola y

Ganadero (SAG) and with APHIS personnel monitoring the treatments;

(2) The tomatoes must be treated and packed within 24 hours of

harvest. Once treated, the tomatoes must be safeguarded by a fruit fly-

proof mesh screen or plastic tarpaulin while in transit to the packing

house and while awaiting packing, and be packed in fruit fly-proof

containers under APHIS monitoring for transit to the airport and

subsequent shipping to the United States; and

(3) Tomatoes may be imported into the United States from Chile only

if SAG has entered into a trust fund agreement with APHIS for that

shipping season. This agreement requires SAG to pay in advance all

costs that APHIS estimates it will incur in providing the preclearance

services prescribed in this section for that shipping season. These

costs will include administrative expenses incurred in conducting the

preclearance services; and all salaries (including overtime and the

Federal share of employee benefits), travel expenses (including per

diem expenses), and other incidental expenses incurred by the

inspectors in providing these services. The agreement requires SAG to

deposit a certified or cashier's check with APHIS for the amount of

these costs for the entire shipping season, as estimated by APHIS based

on projected shipment volumes and cost figures from previous

inspections. The agreement further requires that, if the initial

deposit is not sufficient to meet all costs incurred by APHIS, SAG must

deposit with APHIS another certified or cashier's check for the amount

of the remaining costs, as determined by APHIS, before the inspections

will be completed. The agreement also requires that, in the event of

unexpected end-of-season costs, SAG must deposit with APHIS a certified

cashier's check sufficient to meet such costs as estimated by APHIS,

before any further preclearance services will be provided. If the

amount SAG deposits during a shipping season exceeds the total cost

incurred by APHIS in providing preclearance services, the difference

will be returned to SAG by APHIS at the end of the shipping season.

(Approved by the Office of Management and Budget under control

number 0579-0131)

Done in Washington, DC, this 15th day of July, 1998.

Charles Schwalbe,

Acting Administrator, Animal and Plant Health Inspection Service.

[FR Doc. 98-19470 Filed 7-21-98; 8:45 am]

BILLING CODE 3410-34-P