Importation of Apples From China

AGENCY:

Animal and Plant Health Inspection Service, USDA.

ACTION:

Proposed rule.

SUMMARY:

We are proposing to amend the fruits and vegetables regulations to allow the importation of fresh apples (Malus pumila) from China into the continental United States. As a condition of entry, apples from areas in China in which the Oriental fruit fly (Bactrocera dorsalis) is not known to exist would have to be produced in accordance with a systems approach that would include requirements for registration of places of production and packinghouses, inspection for quarantine pests at set intervals by the national plant protection organization of China, bagging of fruit, safeguarding, labeling, and importation in commercial consignments. Apples from areas in China in which Oriental fruit fly is known to exist could be imported into the continental United States if, in addition to these requirements, the apples are treated with fumigation plus refrigeration. All apples from China would also be required to be accompanied by a phytosanitary certificate with an additional declaration stating that all conditions for the importation of the apples have been met and that the consignment of apples has been inspected and found free of quarantine pests. This action would allow for the importation of apples from China into the continental United States while continuing to provide protection against the introduction of quarantine pests.

DATES:

We will consider all comments that we receive on or before September 16, 2014.

ADDRESSES:

You may submit comments by either of the following methods:

• Federal eRulemaking Portal: Go to http://www.regulations.gov/#!docketDetail;D=APHIS-2014-0003 .
• Postal Mail/Commercial Delivery: Send your comment to Docket No. APHIS-2014-0003, Regulatory Analysis and Development, PPD, APHIS, Station 3A-03.8, 4700 River Road, Unit 118, Riverdale, MD 20737-1238.

Supporting documents and any comments we receive on this docket may be viewed at http://www.regulations.gov/#!docketDetail;D=APHIS-2014-0003 or in our reading room, which is located in room 1141 of the USDA South Building, 14th Street and Independence Avenue SW., Washington, DC. Normal reading room hours are 8 a.m. to 4:30 p.m., Monday through Friday, except holidays. To be sure someone is there to help you, please call (202) 799-7039 before coming.

FOR FURTHER INFORMATION CONTACT:

Mr. Marc Phillips, Senior Regulatory Policy Specialist, Regulatory Coordination and Compliance, PPQ, APHIS, 4700 River Road, Unit 156, Riverdale, MD 20737; (301) 851-2114.

SUPPLEMENTARY INFORMATION:

Background

The regulations in “Subpart—Fruits and Vegetables” (7 CFR 319.56-1 through 319.56-68, 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 that are new to or not widely distributed within the United States.

The national plant protection organization (NPPO) of China has requested that the Animal and Plant Health Inspection Service (APHIS) amend the regulations to allow apples (Malus pumila) from China to be imported into the continental United States.

As part of our evaluation of China's request, we have prepared a pest risk assessment (PRA), titled “Importation of Apples (Malus pumila) from China into the Continental United States” (June 10, 2013).

The PRA evaluates the risks associated with the importation of apples into the continental United States from China. Copies of the PRA may be obtained by contacting the individual listed under FOR FURTHER INFORMATION CONTACT or viewed on the Regulations.gov Web site (see ADDRESSES above for instructions for accessing Regulations.gov). The PRA identifies 21 pests of quarantine significance present in China that could be introduced into the continental United States through the importation of Chinese apples:

• Adoxophyes orana (Fischer von Röslerstamm), summer fruit tortix.
• Archips micaceana (Walker), a moth.
• Argyrotaenia ljungiana (Thunberg), grape tortix.
• Bactrocera dorsalis (Hendel), Oriental fruit fly.
• Carposina sasakii Matsumura, peach fruit moth.
• Cenopalpus pulcher (Canestrini & Fanzago), flat scarlet mite.
• Cryptoblabes gnidiella (Millière), honeydew moth.
• Cydia funebrana (Treitschke), plum fruit moth.
• Euzophera bigella (Zeller), quince moth.
• Euzophera pyriella Yang, a moth.
• Grapholita inopinata Heinrich, Manchurian fruit moth.
• Leucoptera malifoliella (Costa), apple leaf miner.
• Monilia polystroma van Leeuwen, Asian brown rot.
• Monilinia fructigena Honey, brown fruit rot.
• Rhynchites auratus (Scopoli), apricot weevil.
• Rhynchites bacchus (L.), peach weevil.
• Rhynchites giganteus Krynicky, a weevil.
• Rhynchites heros Roelofs, a weevil.
• Spilonota albicana (Motschulsky), white fruit moth.
• Spilonota prognathana Snellen, a moth.
• Ulodemis trigrapha Meyrick, a moth.

The PRA states that measures beyond standard port-of-entry inspection are required to mitigate the risks posed by these plant pests. After consideration of potential mitigation options, we have prepared a risk management document (RMD) to recommend specific measures to mitigate these risks. Copies of the RMD may be obtained from the person listed under FOR FURTHER INFORMATION CONTACT or viewed on the Regulations.gov Web site.

Based on the recommendations of the RMD, we are proposing to allow the importation of apples from China into the continental United States only if they are produced in accordance with a systems approach; we are proposing to add the systems approach to the regulations in a new § 319.56-69 governing the importation of apples from China.

Proposed Systems Approach

General Requirements

Paragraph (a) of § 319.56-69 would set out general requirements for the NPPO of China and for growers and packers producing apples for export to the continental United States.

Paragraph (a)(1) would require the NPPO of China to provide an operational workplan to APHIS that details the activities that the NPPO will, subject to APHIS' approval of the workplan, carry out to meet the requirements of proposed § 319.56-69. As described in a notice we published on May 10, 2006, in the Federal Register (71 FR 27221-27224, Docket No. APHIS-2005-0085), an operational workplan is an agreement between APHIS' Plant Protection and Quarantine (PPQ) program, officials of the NPPO of a foreign government, and, when necessary, foreign commercial entities that specifies in detail the phytosanitary measures that will comply with our regulations governing the import or export of a specific commodity. Operational workplans establish detailed procedures and guidance for the day-to-day operations of specific import/export programs. Workplans also establish how specific phytosanitary issues are dealt with in the exporting country and make clear who is responsible for dealing with those issues. The implementation of a systems approach typically requires an operational workplan to be developed.

Paragraph (a)(2) would require the apples to be grown in places of production that are registered with the NPPO of China.

Paragraph (a)(3) would state that apples from China may be imported in commercial consignments only. Produce grown commercially is less likely to be infested with plant pests than noncommercial consignments. Noncommercial consignments are more prone to infestation because the commodity is often ripe to overripe and is often grown with little to no pest control. Commercial consignments, as defined within the regulations, are consignments that an inspector identifies as having been imported for sale and distribution. Such identification is based on a variety of indicators, including, but not limited to: Quantity of produce, type of packaging, identification of grower or packinghouse on the packaging, and documents consigning the fruits or vegetables to a wholesaler or retailer.

Place of Production Requirements

Our systems approach would require certain measures to take place at the registered places of production.

Proposed paragraph (b) of § 319.56-69 would contain these measures. Paragraph (b)(1) would require the place of production to carry out any phytosanitary measures specified for the place of production under the operational workplan. Depending on the location, size, and plant pest history of the orchard, these measures may include surveying protocols or application of pesticides and fungicides.

Paragraph (b)(2) would state that, when any apples destined for export to the continental United States are still on the tree and are no more than 2 centimeters in diameter, double-layered paper bags must be placed wholly over the apples. The bags would have to remain intact and on the apples until the apples arrive at the packinghouse. This bagging protocol, which is modeled on a similar requirement for Ya pears and sand pears from China, helps protect the apples against the quarantine moths and fungi.

Paragraph (b)(3) would require the NPPO of China to visit and inspect registered places of production prior to harvest for signs of infestations. This provision is modeled on existing provisions for the importation of fragrant pears and sand pears from China, and serves a dual purpose: It not only provides for the NPPO of China to inspect the place of production for quarantine pests in a manner that APHIS believes to be sufficiently rigorous, but also affords the NPPO the opportunity to determine whether the orchard has continually maintained the phytosanitary measures specified for it under the operational workplan.

Paragraph (b)(4) would state that, if either Monilia polystroma van Leeuwen or Monilinia fructigena is detected at a registered place of production, APHIS could reject the consignment or prohibit the importation into the continental United States of apples from the place of production for the remainder of the season. The exportation to the continental United States of apples from the place of production could resume in the next growing season if an investigation is conducted by the NPPO of China and APHIS and the NPPO conclude that appropriate remedial action has been taken. If either Monilia polystroma van Leeuwen or Monilinia fructigena are detected at more than one registered place of production within a province, APHIS could prohibit the importation into the continental United States of apples from that province until an investigation is conducted and APHIS and the NPPO conclude that appropriate remedial action has been taken. Procedures for disqualification of registered places of production based on detection of other listed pests of concern will be detailed in the operational workplan approved by APHIS and the NPPO. We are specifically requiring inspection for Monilia polystroma van Leeuwen and Monilinia fructigena as inspections provide phytosanitary protection against these pests and eliminate the need for additional treatment such as fungicidal dips. The other proposed requirements provide sufficient mitigation against the other pests of concern and therefore specific inspection, apart from standard port of entry inspection, for those pests is unnecessary.

Packinghouse Requirements

Paragraph (c) of § 319.56-69 would set forth requirements for mitigation measures that would have to take place at registered packinghouses. Paragraph (c)(1) would require that, during the time registered packinghouses are in use for packing apples for export to the continental United States, the packinghouses may only accept apples that are from registered places of production and that are produced in accordance with the requirements of proposed § 319.56-69. Apples from other places of production may be produced under conditions that are less stringent than those of this proposed rule, and may therefore be a pathway for the introduction of quarantine pests into the packinghouses.

Paragraph (c)(2) would require packinghouses to have a tracking system in place to readily identify all apples destined for export to the continental United States that enter the packinghouse and be able to trace the apples back to their place of production. In the event that quarantine pests are discovered in any consignment, the packinghouse would have to use the tracking system to determine the place of production of the apples, and supply the NPPO of China or officials authorized by the NPPO with this information. The NPPO would then inspect the place of production in order to determine the scope of the outbreak and the remedial actions necessary to address it.

Paragraph (c)(3) would state that, following the packinghouse inspection, the packinghouse must follow a handling procedure for the apples that is mutually agreed upon by APHIS and the NPPO of China. Handling procedures could include such measures as culling damaged apples, removing leaves from the apples, wiping the apples with a clean cloth, air blasting, or grading.

Paragraph (c)(4) would require that the apples be washed and waxed prior to shipment. Washing and waxing removes surface pests such as scale insects, mealybugs, and mites.

Paragraph (c)(5) would require the apples to be packed in cartons that are labeled with the identity of the place of production and the packinghouse. In the event that quarantine pests are discovered in a consignment of apples after it is exported to the United States, this labeling will facilitate traceback and help the NPPO and APHIS delimit the scope of the outbreak.

Shipping Requirements

Proposed paragraph (d) of § 319.56-69 would set forth shipping requirements for apples from China. It would require sealed containers of apples destined for export to the continental United States to be held in a cold storage facility while awaiting export. This would help to prevent pest infestation of packed apples, as certain of the quarantine pests for apples from China are averse to cold conditions.

Phytosanitary Certificate

Paragraph (e) of § 319.56-69 would require each consignment of apples imported from China into the continental United States to be accompanied by a phytosanitary certificate issued by the NPPO of China with an additional declaration stating that the requirements of § 319.56-69 have been met and the consignment has been inspected by the NPPO of China and found free of quarantine pests.

Additional Condition for Apples From Areas of China South of the 33rd Parallel

The mitigation measures contained in proposed paragraphs (a) through (e) of § 319.56-69 would apply to all apples imported into the continental United States from China. However, since the Oriental fruit fly is known to exist, in varying population densities, in areas of China south of the 33rd parallel, apples from such areas would be subject to treatment in accordance with 7 CFR part 305. Within part 305, § 305.2 provides that approved treatment schedules are set out in the PPQ Treatment Manual, found online at http://www.aphis.usda.gov/import_export/plants/manuals/ports/downloads/treatment.pdf . (The manual specifies that fumigation plus refrigeration schedule T108-a is effective in neutralizing Oriental fruit fly on apples.) Proposed paragraph (f) of § 319.56-69 would contain this additional requirement.

Executive Order 12866 and Regulatory Flexibility Act

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

In accordance with 5 U.S.C. 603, we have performed an initial regulatory flexibility analysis, which is summarized below, regarding the economic effects of this proposed rule on small entities. Copies of the full analysis are available by contacting the person listed under FOR FURTHER INFORMATION CONTACT or on the Regulations.gov Web site (see ADDRESSES above for instructions for accessing Regulations.gov).

Based on the information we have, there is no reason to conclude that adoption of this proposed rule would result in any significant economic effect on a substantial number of small entities. However, we do not currently have all of the data necessary for a comprehensive analysis of the effects of this proposed rule on small entities. Therefore, we are inviting comments on potential effects. In particular, we are interested in determining the number and kind of small entities that may incur benefits or costs from the implementation of this proposed rule.

The proposed rule would allow the importation of fresh apples from China into the continental United States if they are produced in accordance with a systems approach specified in the APHIS approved operational workplan. As required by Executive Orders 12866 and 13563, this analysis examines expected regulatory impacts of the proposed rule on U.S. entities.

Apples are the second most popular fresh fruit for consumers and the third most valuable fruit crop produced in the United States. The United States is the world's second largest apple producer; it became the world's largest apple exporter by value in 2012, generating $909 million in fresh apple trade surplus (exports minus imports). That year, the United States commercially produced 4.1 million metric tons (MT) of apples, valued at $3 billion. According to the 2007 Census of Agriculture, the 25,591 U.S. apple farms had orchards that averaged 15.6 acres. Virtually all apple farms are family owned, and many of these families have been engaged in apple production for many generations.

Although apples are commercially grown in all 50 States, 9 States account for 96 percent of production. The State of Washington is by far the largest producer, at more than 2.9 million MT per year. Almost all apple farms are family owned, and many of these families have been engaged in apple production for many generations. The United States imported 183,000 MT of fresh apples, valued at $164 million, in 2012. Virtually all imports came from four trading partners: Chile, New Zealand, Canada, and Argentina.

By quantity, China is the world's largest producer, consumer, and exporter of apples. Apples are the leading fruit produced in China, with production having increased from 2.3 million MT in 1978, to 38.5 million MT in 2012. At the same time, its domestic demand for apples has grown to 37.5 million MT (33.3 million MT for fresh consumption and 5.2 million MT for processing). Unlike in the United States, China's apple industry relies marginally on international trade—it exported about 3 percent of fresh apples produced and imported 0.1 percent of fresh apples consumed in 2012, while the United States exported about 30 percent of fresh apples produced and imported 9 percent of fresh apples consumed in 2012. China's exports of fresh apples peaked in 2009 at 1.2 million MT and declined to 0.98 million MT in 2012. Most of the 4.3 million apple growers in China operate on a small scale, with farm acreages averaging 1.3 acres. The Fuji variety accounted for about 70 percent of China's apple production in 2012. China's heavy dependence on the Fuji variety sharply contrasts to the diverse varieties that are produced in the United States.

China's export markets are concentrated in Russia, Southeast Asia, and the Middle East. Chinese fresh apples also have been exported to Canada for more than a decade; however, Canada accounted only for 0.4 percent of total China's fresh apple exports in 2012. In fact, the combined export volume to Canada, European Union (EU) member countries, Australia, and Mexico is very small (0.8 percent of total fresh apple exports by China in 2012), and has significantly declined in the last 6 years, from 45,267 MT in 2007 (4.4 percent of Chinese apple exports) to 8,273 MT in 2012. Average export prices of fresh apples from China in 2012 to the aforementioned countries (Canada, $1.50/KG; EU, $1.10/KG; Australia, $1.83/KG; and Mexico, $1.55/KG) are consistently higher than the average export price for all 67 countries to which China exported fresh apples ($0.98/KG). It is reasonable to expect that prices for fresh apples exported to the United States would be similar to the prices paid by Canada and Mexico. Since the trend for U.S. fresh apple import prices has been steady at around $0.89/KG, apples imported from China are not likely to compete solely on price in the U.S. market. U.S. consumers make their purchasing decisions for fresh apples based not only on price, but also on qualitative attributes such as variety, flavor, appearance, freshness, production method, and product origin.

Based on historic trade data, not more than 10,000 MT of fresh apples is expected to be imported from China into the continental United States annually, which would be the equivalent of about 5 percent of U.S. imports and 0.44 percent of the U.S. domestic fresh apple supply in 2012. Most of China's fresh apple exports to the United States would likely be shipped to West Coast ports, primarily ones in California. California is also the largest market for Washington apples, and any effects of the proposed rule may be borne mainly by Washington and California apple growers, in particular, U.S. apple growers of the Fuji variety. U.S. apple growers of other varieties and in other areas may also experience limited effects in terms of increased competition.

While China's interest in obtaining market access to the United States for its apples is a recognized concern of the U.S. apple industry, the industry is challenged by relatively flat domestic apple consumption. The industry's growth can be fostered through expanded global trade. Given APHIS' determination that the proposed rule will not result in significant adverse impacts on plant health, the proposed rule could provide additional trade opportunities for the two countries.

Executive Order 12988

This proposed rule would allow apples to be imported into the continental United States from China. If this proposed rule is adopted, State and local laws and regulations regarding apples imported under this rule would be preempted while the fruit is in foreign commerce. Fresh fruits are generally imported for immediate distribution and sale to the consuming public and would remain in foreign commerce until sold to the ultimate consumer. The question of when foreign commerce ceases in other cases must be addressed on a case-by-case basis. If this proposed rule is adopted, 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.

Paperwork Reduction Act

In accordance with section 3507(d) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.), the information collection or recordkeeping requirements included in this proposed rule have been submitted for approval to the Office of Management and Budget (OMB). Please send written comments to the Office of Information and Regulatory Affairs, OMB, Attention: Desk Officer for APHIS, Washington, DC 20503. Please state that your comments refer to Docket No. APHIS-2014-0003. Please send a copy of your comments to: (1) APHIS, using one of the methods described under ADDRESSES at the beginning of this document, and (2) Clearance Officer, OCIO, USDA, Room 404-W, 14th Street and Independence Avenue SW., Washington, DC 20250. A comment to OMB is best assured of having its full effect if OMB receives it within 30 days of publication of this proposed rule.

APHIS is proposing to amend the fruits and vegetables regulations to allow for the importation of fresh apples (Malus pumila) from China into the continental United States. As a condition of entry, apples from areas in China in which the Oriental fruit fly (Bactrocera dorsalis) is not known to exist would have to be produced in accordance with a systems approach that would include requirements for registration of places of production and packinghouses, inspection for quarantine pests at set intervals by the National Plant Protection Organization (NPPO) of China, bagging of fruit, safeguarding, labeling, and importation in commercial consignments. Apples from areas in China in which Oriental fruit fly is known to exist could be imported into the continental United States if, in addition to these requirements, the apples are treated with fumigation plus refrigeration.

All apples from China would also be required to be accompanied by a phytosanitary certificate with an additional declaration stating that all conditions for the importation of the apples have been met and that the consignment of apples has been inspected and found free of quarantine pests. This action would allow for the importation of apples from China into the continental United States while continuing to provide protection against the introduction of quarantine pests.

Allowing the importation of apples into the continental United States from China will require an operational workplan, production site and packinghouse registrations, tracking system, box labeling, and phytosanitary certificates.

We are soliciting comments from the public (as well as affected agencies) concerning our proposed information collection and recordkeeping requirements. These comments will help us:

(1) Evaluate whether the proposed information collection is necessary for the proper performance of our agency's functions, including whether the information will have practical utility;

(2) Evaluate the accuracy of our estimate of the burden of the proposed information collection, including the validity of the methodology and assumptions used;

(3) Enhance the quality, utility, and clarity of the information to be collected; and

(4) Minimize the burden of the information collection on those who are to respond (such as through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology; e.g., permitting electronic submission of responses).

Estimate of burden: Public reporting burden for this collection of information is estimated to average 0.0079 hours per response.

Respondents: NPPO of China, producers, and exporters.

Estimated annual number of respondents: 181.

Estimated annual number of responses per respondent: 278.

Estimated annual number of responses: 50,461.

Estimated total annual burden on respondents: 400 hours. (Due to averaging, the total annual burden hours may not equal the product of the annual number of responses multiplied by the reporting burden per response.)

Copies of this information collection can be obtained from Mrs. Celeste Sickles, APHIS' Information Collection Coordinator, at (301) 851-2908.

E-Government Act Compliance

The Animal and Plant Health Inspection Service is committed to compliance with the E-Government Act to promote the use of the Internet and other information technologies, to provide increased opportunities for citizen access to Government information and services, and for other purposes. For information pertinent to E-Government Act compliance related to this proposed rule, please contact Mrs. Celeste Sickles, APHIS' Information Collection Coordinator, at (301) 851-2908.

List of Subjects in 7 CFR Part 319

• Coffee
• Cotton
• Fruits
• Imports
• Logs
• Nursery stock
• Plant diseases and pests
• Quarantine
• Reporting and recordkeeping requirements
• Rice
• Vegetables

Accordingly, we propose to amend 7 CFR part 319 as follows:

PART 319—FOREIGN QUARANTINE NOTICES

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

Authority: 7 U.S.C. 450, 7701-7772, and 7781-7786; 21 U.S.C. 136 and 136a; 7 CFR 2.22, 2.80, and 371.3.

2. Section 319.56-69 is added to read as follows: