Pork Promotion, Research, and Consumer Information Order Decrease in Importer Assessments

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1230

[No. LS-99-03]

Pork Promotion, Research, and Consumer Information Order--

Decrease in Importer Assessments

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: Pursuant to the Pork Promotion, Research, and Consumer

Information Act (Act) of 1985 and the Pork Promotion, Research, and

Consumer Information Order (Order) issued thereunder, this proposed

rule would decrease by sixteen-hundredths of a cent per pound the

amount of the assessment per pound due on imported pork and pork

products to reflect a decrease in the 1998 five-market average price

for domestic barrows and gilts. This proposed action would bring the

equivalent market value of the live animals from which such imported

pork and pork products were derived in line with the market values of

domestic porcine animals. These proposed changes will facilitate the

continued collection of assessments on imported porcine animals, pork,

and pork products.

DATES: Comments must be received by July 12, 1999.

ADDRESSES: Send two copies of comments to Ralph L. Tapp, Chief;

Marketing Programs Branch; Livestock and Seed Program; Agricultural

Marketing Service (AMS), USDA; STOP 0251; 1400 Independence Avenue,

SW.; Washington, D.C. 20250-0251. Comments will be available for public

inspection during regular business hours at the above office in Room

2627 South Building; 14th and Independence Avenue, SW.; Washington,

D.C. 20250-0251.

FOR FURTHER INFORMATION CONTACT: Ralph L. Tapp, Chief, Marketing

Programs Branch, 202/720-1115.

SUPPLEMENTARY INFORMATION:

Executive Orders 12866 and 12778 and Regulatory Flexibility Act

This proposed rule has been determined to be not significant for

purposes of Executive Order 12866 and therefore has not been reviewed

by the Office of Management and Budget.

This proposed rule has been reviewed under Executive Order 12988,

Civil Justice Reform. This proposal is not intended to have a

retroactive effect. The Act states that the statute is intended to

occupy the field of promotion and consumer education involving pork and

pork products and of obtaining funds thereof from pork producers and

that the regulation of such activity (other than a regulation or

requirement relating to a matter of public health or the provision of

State or local funds for such activity) that is in addition to or

different from the Act may not be imposed by a State.

The Act provides that administrative proceedings must be exhausted

before parties may file suit in court. Under Sec. 1625 of the Act, a

person subject to an order may file a petition with the Secretary

stating that such order, a provision of such order or an obligation

imposed in connection with such order is not in accordance with the

law; and requesting a modification of the order or an exemption from

the order. Such person 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 the

district in which a person resides or does business has jurisdiction to

review the Secretary's determination, if a complaint is filed not later

than 20 days after the date such person receives notice of such

determination.

This action also was reviewed under the Regulatory Flexibility Act

(RFA) (5 United States Code (U.S.C.) 601 et seq.). The effect of the

Order upon small entities initially was discussed in the September 5,

1986, issue of the Federal Register. (51 FR 31898). It was determined

at that time that the Order would not have a significant effect upon a

substantial number of small entities. Many of the estimated 1,000

importers may be classified as small entities under the Small Business

Administration definition (13 CFR 121.601).

This proposed rule would decrease the amount of assessments on

imported pork and pork products subject to assessment by sixteen-

hundredths of a cent per pound, or as expressed in cents per kilogram,

thirty-three-hundredths of a cent per kilogram. This decrease is

consistent with the decrease in the annual average price of domestic

barrows and gilts for calendar year 1998. The average annual market

price decreased from $51.30 per hundredweight in 1997 to $31.82 per

hundredweight in 1998, a decrease of about 38 percent. Adjusting the

assessments on imported pork and pork products would result in an

estimated decrease in assessments of $888,000 over a 12-month period.

Assessments collected for 1998 were $3,834,656. Accordingly, the

Administrator of AMS has determined that this action would not have a

significant economic impact on a substantial number of small entities.

The Act (7 U.S.C. 4801-4819) approved December 23, 1985, authorized

the establishment of a national pork promotion, research, and consumer

information program. The program was funded by an initial assessment

rate of 0.25 percent of the market value of all porcine animals

marketed in the United States and an equivalent amount of assessment on

imported porcine animals, pork, and pork products. However, that rate

was increased to 0.35 percent in 1991 (56 FR 51635) and to 0.45 percent

effective September 3, 1995 (60 FR 29963). The final Order establishing

a pork promotion, research, and consumer information program was

published in the September 5, 1986, issue of the Federal Register (51

FR 31898; as corrected, at 51 FR 36383 and amended at 53 FR 1909, 53 FR

30243, 56 FR 4, 56 FR 51635, 60 FR 29962, 60 FR 33681 and 60 FR 58501)

and assessments began on November 1, 1986.

The Order requires importers of porcine animals to pay U.S. Customs

Service (USCS), upon importation, the assessment of 0.45 percent of the

animal's declared value and importers of pork and pork products to pay

USCS, upon importation, the assessment of 0.45 percent of the market

value of the live porcine animals from which such pork and pork

products were produced. This proposed rule would decrease the

assessments on all of the imported pork and pork products subject to

assessment as published in the Federal Register as a final rule August

28, 1998, and effective on September 28, 1998; (63 FR 45935). Based on

information reported by USDA, AMS, Livestock and Grain Market News

(LGMN) Branch, this decrease is consistent with the decrease in the

annual average price of domestic barrows and gilts for calendar year

1998. This decrease in assessments would make the equivalent market

value of the live porcine animal from which the imported pork and pork

products were derived reflect the recent decrease in the market value

of domestic porcine animals, thereby promoting comparability between

importer and domestic assessments. This proposed rule would not change

the current assessment rate of 0.45 percent of the market value.

The methodology for determining the per pound amounts for imported

pork and pork products was described in the Supplementary Information

accompanying the Order and published in the September 5, 1986, Federal

[[Page 31159]]

Register at 51 FR 31901. The weight of imported pork and pork products

is converted to a carcass weight equivalent by utilizing conversion

factors which are published in the Department's Statistical Bulletin

No. 697 ``Conversion Factors and Weights and Measures.'' These

conversion factors take into account the removal of bone, weight lost

in cooking or other processing, and the nonpork components of pork

products. Secondly, the carcass weight equivalent is converted to a

live animal equivalent weight by dividing the carcass weight equivalent

by 70 percent, which is the average dressing percentage of porcine

animals in the United States. Thirdly, the equivalent value of the live

porcine animal is determined by multiplying the live animal equivalent

weight by an annual average market price for barrows and gilts based on

information reported by USDA, AMS, LGMN Branch. Finally, the equivalent

value is multiplied by the applicable assessment rate of 0.45 percent

due on imported pork and pork products. The end result is expressed in

an amount per pound for each type of pork or pork product. To determine

the amount per kilogram for pork and pork products subject to

assessment under the Act and Order, the cent per pound assessments are

multiplied by a metric conversion factor 2.2046 and carried to the

sixth decimal.

The formula in the preamble for the Order at 51 FR 31901

contemplated that it would be necessary to recalculate the equivalent

live animal value of imported pork and pork products to reflect changes

in the annual average price of domestic barrows and gilts to maintain

equity of assessments between domestic porcine animals and imported

pork and pork products.

The average annual market price decreased from $51.30 per

hundredweight in 1997 to $31.82 per hundredweight in 1998, a decrease

of about 38 percent. This decrease would result in a corresponding

decrease in assessments for all HTS numbers listed in the table in

Sec. 1230.110, 63 FR 45935; August 28, 1998, of an amount equal to

sixteen-hundredths of a cent per pound, or as expressed in cents per

kilogram, thirty-three hundredths of a cent per kilogram. Based on the

most recent available Department of Commerce, Bureau of Census, data on

the volume of imported pork and pork products available for the period

January 1, 1998, through December 31, 1998, the proposed decrease in

assessment amounts would result in an estimated $888,000 decrease in

assessments over a 12-month period.

This proposed rule provides for a 30-day comment period. This

comment period is appropriate because the proposed rule simply provides

for an adjustment in the per pound assessment levels on imported pork

and pork products to reflect changes in live hog prices which occurred

from 1997 to 1998. These live hog prices form the basis for the

assessments. This adjustment, if adopted, should be made effective as

soon as possible to promote optimum equity.

List of Subjects in 7 CFR Part 1230

Administrative practice and procedure, Advertising, Agricultural

research, Marketing agreement, Meat and meat products, Pork and pork

products.

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

CFR Part 1230 be amended as follows:

PART 1230--PORK PROMOTION, RESEARCH, AND CONSUMER INFORMATION

1. The authority citation for 7 CFR Part 1230 continues to read as

follows:

Authority: 7 U.S.C. 4801-4819.

Subpart B--[Amended]

2. In Sec. 1230.110 paragraph (b) is revised to read as follows:

Sec. 1230.110 Assessments on imported pork and pork products.

* * * * *

(b) The following HTS categories of imported pork and pork products

are subject to assessment at the rates specified.

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Assessment

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

Pork and pork products cents/

lb cents/kg

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0203.11.0000......................................... .20 .440920

0203.12.1010......................................... .20 .440920

0203.12.1020......................................... .20 .440920

0203.12.9010......................................... .20 .440920

0203.12.9020......................................... .20 .440920

0203.19.2010......................................... .24 .529104

0203.19.2090......................................... .24 .529104

0203.19.4010......................................... .20 .440920

0203.19.4090......................................... .20 .440920

0203.21.0000......................................... .20 .440920

0203.22.1000......................................... .20 .440920

0203.22.9000......................................... .20 .440920

0203.29.2000......................................... .24 .529104

0203.29.4000......................................... .20 .440920

0206.30.0000......................................... .20 .440920

0206.41.0000......................................... .20 .440920

0206.49.0000......................................... .20 .440920

0210.11.0010......................................... .20 .440920

0210.11.0020......................................... .20 .440920

0210.12.0020......................................... .20 .440920

0210.12.0040......................................... .20 .440920

0210.19.0010......................................... .24 .529104

0210.19.0090......................................... .24 .529104

1601.00.2010......................................... .28 .617288

1601.00.2090......................................... .28 .617288

1602.41.2020......................................... .31 .683426

1602.41.2040......................................... .31 .683426

1602.41.9000......................................... .20 .440920

1602.42.2020......................................... .31 .683426

1602.42.2040......................................... .31 .683426

1602.42.4000......................................... .20 .440920

1602.49.2000......................................... .28 .617288

1602.49.4000......................................... .24 .529104

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Dated: June 4, 1999.

Barry L. Carpenter,

Deputy Administrator, Livestock and Seed Program.

[FR Doc. 99-14689 Filed 6-9-99; 8:45 am]

BILLING CODE 3410-02-P