Sun-Maid Wants an End to Raisin Regulation

     (CN) – The Department of Agriculture ignored a call to reform the procedures setting volume limits on the raisin market, Sun-Maid told a federal judge.
     Sun-Maid Growers of California filed the complaint in Washington, D.C., on Monday against the U.S. Department of Agriculture and Secretary Thomas Vilsack.
     A marketing cooperative of farmers, Sun-Maid says it petitioned on Nov. 17, 2014, to have Vilsack suspend and ultimately revoke outdated volume regulations contained in the California Raisin Marketing Order.
     California’s Raisin Marketing Order was issued in 1949 when U.S. farm production exceeded demand following World War II, according to the complaint.
     “Faced with large wine grape inventories, farmers shifted use of acres of raisin-variety grapes from wine production to raisin production and converted surplus grapes into raisins,” the complaint states. “Simultaneously, exports of raisins dropped. As a result, the amount of raisins grown far exceeded the amount that could be economically marketed, leading to a sharp decline in the price of raisins.”
     In response, the order authorized the secretary of Agriculture to establish a reserve pool that limits the supply of raisins reaching the commercial market each year.
     “To establish such a ‘reserve pool,’ the secretary is permitted to order ‘handlers’ of raisins to hold a certain percentage of producers’ yearly raisin crop in reserve, thereby preventing this surplus from reaching the commercial market,” the complaint states.
     Raisin handlers have not faced limits since 2010, Sun-Maid claims.
     “Nevertheless, the very existence of the marketing order – and the yearly prospect that volume restrictions might be imposed – impedes growth, investment, and reinvestment by raisin producers, even if such restrictions are not imposed,” according to the complaint. “The prospect of volume restrictions deprives producers of the ability to make either short-term or long-term predictions about the marketing of their crops.”
     Sun-Maid says it asked the Department of Agriculture to investigate whether volume regulation is still necessary to maintain stability in the raisin market, because collaborative efforts to update the order via the Raisin Administrative Committee have “broken down.”
     Vilsack nevertheless denied Sun-Maid’s request without addressing any of its specific concerns, according to the complaint.
     “The secretary’s denial failed to explain the grounds upon which it was based, and did not evince reasoned decision making,” Sun-Maid says. “In particular, the Secretary’s denial does not demonstrate that he considered any of the points Sun-Maid’s Petition raised, or, if he did, why he found them unpersuasive.”
     In a related case, the Supreme Court will hear a case filed by the Raisin Valley Marketing Association arguing that its farmers may stop putting crops in the federal reserve pool.
     Sun-Maid is represented by M. Miller Baker with McDermott Will & Emery LLP.

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