
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 7USC7271]

 
                          TITLE 7--AGRICULTURE
 
               CHAPTER 100--AGRICULTURAL MARKET TRANSITION
 
                    SUBCHAPTER IV--OTHER COMMODITIES
 
                        Part B--Peanuts and Sugar
 
Sec. 7271. Peanut program


(a) Quota peanuts

                      (1) Availability of loans

        The Secretary shall make nonrecourse loans available to 
    producers of quota peanuts.

                            (2) Loan rate

        The national average quota loan rate for quota peanuts shall be 
    $610 per ton.

                (3) Inspection, handling, or storage

        The loan amount may not be reduced by the Secretary by any 
    deductions for inspection, handling, or storage.

                   (4) Location and other factors

        The Secretary may make adjustments in the loan rate for quota 
    peanuts for location of peanuts and such other factors as are 
    authorized by section 7282 of this title.

                      (5) Offers from handlers

        If a producer markets a quota peanut crop, meeting quality 
    requirements for domestic edible use, through the marketing 
    association loan for two consecutive marketing years and the 
    Secretary determines that a handler provided the producer with a 
    written offer, upon delivery, for the purchase of the quota peanut 
    crops at a price equal to or in excess of the quota support price, 
    the producer shall be ineligible for quota price support for the 
    next marketing year. The Secretary shall establish the method by 
    which a producer may appeal a determination under this paragraph 
    regarding ineligibility for quota price support.

(b) Additional peanuts

                           (1) In general

        Subject to paragraph (2), the Secretary shall make nonrecourse 
    loans available to producers of additional peanuts at such rates as 
    the Secretary finds appropriate, taking into consideration the 
    demand for peanut oil and peanut meal, expected prices of other 
    vegetable oils and protein meals, and the demand for peanuts in 
    foreign markets.

                           (2) Limitation

        The Secretary shall establish the support rate on additional 
    peanuts at a level estimated by the Secretary to ensure that there 
    are no losses to the Commodity Credit Corporation on the sale or 
    disposal of the peanuts.

                          (3) Announcement

        The Secretary shall announce the loan rate for additional 
    peanuts of each crop not later than February 15 preceding the 
    marketing year for the crop for which the loan rate is being 
    determined.

(c) Area marketing associations

                     (1) Warehouse storage loans

        (A) In general

            In carrying out subsections (a) and (b) of this section, the 
        Secretary shall make warehouse storage loans available in each 
        of the producing areas (described in section 1446.95 of title 7 
        of the Code of Federal Regulations (January 1, 1989)) to a 
        designated area marketing association of peanut producers that 
        is selected and approved by the Secretary and that is operated 
        primarily for the purpose of conducting the loan activities. The 
        Secretary may not make warehouse storage loans available to any 
        cooperative that is engaged in operations or activities 
        concerning peanuts other than those operations and activities 
        specified in this section and section 1359a of this title.

        (B) Administrative and supervisory activities

            An area marketing association shall be used in 
        administrative and supervisory activities relating to loans and 
        marketing activities under this section and section 1359a of 
        this title.

        (C) Association costs

            Loans made to the association under this paragraph shall 
        include such costs as the area marketing association reasonably 
        may incur in carrying out the responsibilities, operations, and 
        activities of the association under this section and section 
        1359a of this title.

             (2) Pools for quota and additional peanuts

        (A) In general

            The Secretary shall require that each area marketing 
        association establish pools and maintain complete and accurate 
        records by area and segregation for quota peanuts handled under 
        loan and for additional peanuts placed under loan, except that 
        separate pools shall be established for Valencia peanuts 
        produced in New Mexico.

        (B) Eligibility to participate in New Mexico pools

            (i) In general

                Except as provided in clause (ii), in the case of the 
            1996 and subsequent crops, Valencia peanuts not physically 
            produced in the State of New Mexico shall not be eligible to 
            participate in the pools of the State.
            (ii) Exception

                A producer of Valencia peanuts may enter Valencia 
            peanuts that are produced in Texas into the pools of New 
            Mexico in a quantity not greater than the average annual 
            quantity of the peanuts that the producer entered into the 
            New Mexico pools for the 1990 through 1995 crops.

        (C) Types of peanuts

            Bright hull and dark hull Valencia peanuts shall be 
        considered as separate types for the purpose of establishing the 
        pools.

        (D) Net gains

            Net gains on peanuts in each pool, unless otherwise approved 
        by the Secretary, shall be distributed only to producers who 
        placed peanuts in the pool and shall be distributed in 
        proportion to the value of the peanuts placed in the pool by 
        each producer. Net gains for peanuts in each pool shall consist 
        of the following:
            (i) Quota peanuts

                For quota peanuts, the net gains over and above the loan 
            indebtedness and other costs or losses incurred on peanuts 
            placed in the pool.
            (ii) Additional peanuts

                For additional peanuts, the net gains over and above the 
            loan indebtedness and other costs or losses incurred on 
            peanuts placed in the pool for additional peanuts.

(d) Losses

    Losses in quota area pools shall be covered using the following 
sources in the following order of priority:

              (1) Transfers from additional loan pools

        The proceeds due any producer from any pool shall be reduced by 
    the amount of any loss that is incurred with respect to peanuts 
    transferred from an additional loan pool to a quota loan pool by the 
    producer under section 1358-1(b)(8) of this title.

                     (2) Producers in same pool

        Further losses in an area quota pool shall be offset by reducing 
    the gain of any producer in the pool by the amount of pool gains 
    attributed to the same producer from the sale of additional peanuts 
    for domestic and edible export use.

                       (3) Offset within area

        Further losses in an area quota pool shall be offset by any 
    gains or profits from additional peanuts (other than separate type 
    pools established under subsection (c)(2)(A) of this section for 
    Valencia peanuts produced in New Mexico) owned or controlled by the 
    Commodity Credit Corporation in that area and sold for domestic 
    edible use, in accordance with regulations issued by the Secretary. 
    This paragraph shall not apply to profits or gains from a farm with 
    1 acre or less of peanut production.

               (4) First use of marketing assessments

        The Secretary shall use funds collected under subsection (g) of 
    this section (except funds attributable to handlers) to offset 
    further losses in area quota pools. The Secretary shall transfer to 
    the Treasury those funds collected under subsection (g) of this 
    section and available for use under this paragraph that the 
    Secretary determines are not required to cover losses in area quota 
    pools.

                        (5) Cross compliance

        Further losses in area quota pools, other than losses incurred 
    as a result of transfers from additional loan pools to quota loan 
    pools under section 1358-1(b)(8) of this title, shall be offset by 
    any gains or profits from quota pools in other production areas 
    (other than separate type pools established under subsection 
    (c)(2)(A) of this section for Valencia peanuts produced in New 
    Mexico) in such manner as the Secretary shall by regulation 
    prescribe.

                        (6) Offset generally

        If losses in an area quota pool have not been entirely offset 
    under the preceding paragraphs, further losses shall be offset by 
    any gains or profits from additional peanuts (other than separate 
    type pools established under subsection (c)(2)(A) of this section 
    for Valencia peanuts produced in New Mexico) owned or controlled by 
    the Commodity Credit Corporation and sold for domestic edible use, 
    in accordance with regulations issued by the Secretary. This 
    paragraph shall not apply to profits or gains from a farm with 1 
    acre or less of peanut production.

               (7) Second use of marketing assessments

        The Secretary shall use funds collected under subsection (g) of 
    this section and attributable to handlers to offset further losses 
    in area quota pools. The Secretary shall transfer to the Treasury 
    those funds collected under subsection (g) of this section and 
    available for use under this paragraph that the Secretary determines 
    are not required to cover losses in area quota pools.

                      (8) Increased assessments

        If use of the authorities provided in the preceding paragraphs 
    is not sufficient to cover losses in an area quota pool, the 
    Secretary shall increase the marketing assessment for producers 
    established under subsection (g) of this section by such an amount 
    as the Secretary considers necessary to cover the losses. The 
    increased assessment shall apply only to quota peanuts in the 
    production area covered by the pool. Amounts collected under 
    subsection (g) of this section as a result of the increased 
    assessment shall be retained by the Secretary to cover losses in 
    that pool.

(e) Disapproval of quotas

    Notwithstanding any other provision of law, no loan for quota 
peanuts may be made available by the Secretary for any crop of peanuts 
with respect to which poundage quotas have been disapproved by 
producers, as provided for in section 1358-1(d) of this title.

(f) Quality improvement

                           (1) In general

        With respect to peanuts under loan, the Secretary shall--
            (A) promote the crushing of peanuts at a greater risk of 
        deterioration before peanuts of a lesser risk of deterioration;
            (B) ensure that all Commodity Credit Corporation inventories 
        of peanuts sold for domestic edible use must be shown to have 
        been officially inspected by licensed Department inspectors both 
        as farmer stock and shelled or cleaned in-shell peanuts;
            (C) continue to endeavor to operate the peanut program so as 
        to improve the quality of domestic peanuts and ensure the 
        coordination of activities under the Peanut Administrative 
        Committee established under Marketing Agreement No. 146, 
        regulating the quality of domestically produced peanuts (under 
        the Agricultural Adjustment Act (7 U.S.C. 601 et seq.), 
        reenacted with amendments by the Agricultural Marketing 
        Agreement Act of 1937); and
            (D) ensure that any changes made in the peanut program as a 
        result of this subsection requiring additional production or 
        handling at the farm level shall be reflected as an upward 
        adjustment in the Department loan schedule.

                    (2) Exports and other peanuts

        The Secretary shall require that all peanuts in the domestic and 
    export markets fully comply with all quality standards under 
    Marketing Agreement No. 146.

(g) Marketing assessment

                           (1) In general

        The Secretary shall provide for a nonrefundable marketing 
    assessment. The assessment shall be made on a per pound basis in an 
    amount equal to 1.1 percent for each of the 1994 and 1995 crops, 
    1.15 percent for the 1996 crop, and 1.2 percent for each of the 1997 
    through 2002 crops, of the national average quota or additional 
    peanut loan rate for the applicable crop.

                        (2) First purchasers

        (A) In general

            Except as provided under paragraphs (3) and (4), the first 
        purchaser of peanuts shall--
                (i) collect from the producer a marketing assessment 
            equal to the quantity of peanuts acquired multiplied by--
                    (I) in the case of each of the 1994 and 1995 crops, 
                .55 percent of the applicable national average loan 
                rate;
                    (II) in the case of the 1996 crop, .6 percent of the 
                applicable national average loan rate; and
                    (III) in the case of each of the 1997 through 2002 
                crops, .65 percent of the applicable national average 
                loan rate;

                (ii) pay, in addition to the amount collected under 
            clause (i), a marketing assessment in an amount equal to the 
            quantity of peanuts acquired multiplied by .55 percent of 
            the applicable national average loan rate; and
                (iii) remit the amounts required under clauses (i) and 
            (ii) to the Commodity Credit Corporation in a manner 
            specified by the Secretary.

        (B) ``First purchaser'' defined

            In this subsection, the term ``first purchaser'' means a 
        person acquiring peanuts from a producer except that in the case 
        of peanuts forfeited by a producer to the Commodity Credit 
        Corporation, the term means the person acquiring the peanuts 
        from the Commodity Credit Corporation.

                    (3) Other private marketings

        In the case of a private marketing by a producer directly to a 
    consumer through a retail or wholesale outlet or in the case of a 
    marketing by the producer outside of the continental United States, 
    the producer shall be responsible for the full amount of the 
    assessment and shall remit the assessment by such time as is 
    specified by the Secretary.

                          (4) Loan peanuts

        In the case of peanuts that are pledged as collateral for a loan 
    made under this section, the producer portion of the assessment 
    shall be deducted from the proceeds of the loan. The remainder of 
    the assessment shall be paid by the first purchaser of the peanuts. 
    For purposes of computing net gains on peanuts under this section, 
    the reduction in loan proceeds shall be treated as having been paid 
    to the producer.

                            (5) Penalties

        If any person fails to collect or remit the reduction required 
    by this subsection or fails to comply with the requirements for 
    recordkeeping or otherwise as are required by the Secretary to carry 
    out this subsection, the person shall be liable to the Secretary for 
    a civil penalty up to an amount determined by multiplying--
            (A) the quantity of peanuts involved in the violation; by
            (B) the national average quota peanut rate for the 
        applicable crop year.

                           (6) Enforcement

        The Secretary may enforce this subsection in the courts of the 
    United States.

(h) Crops

    Subsections (a) through (g) of this section shall be effective only 
for the 1996 through 2002 crops of peanuts.

(Pub. L. 104-127, title I, Sec. 155, Apr. 4, 1996, 110 Stat. 922.)

                       References in Text

    The Agricultural Adjustment Act, referred to in subsec. (f)(1)(C), 
is title I of act May 12, 1933, ch. 25, 48 Stat. 31, as amended, which 
is classified generally to chapter 26 (Sec. 601 et seq.) of this title. 
For complete classification of this Act to the Code, see Short Title 
note set out under section 601 of this title and Tables.

                          Codification

    Section is comprised of section 155 of Pub. L. 104-127. Subsec. (i) 
of section 155 of Pub. L. 104-127 amended sections 1358-1, 1358b, 1358c, 
and 1359a of this title.
