Page 1 NOMINATING PARTY: The United States of America BRIEF DESCRIPTIVE TITLE OF NOMINATION: JUNE 2005 QUESTIONS ON CUNS FOR 2006 AND/ OR 2007 FOR POST HARVEST APPLICATIONS DATE Version of August 18, 2005 Table of Contents I. Ham................................................................................................................................................... 1 II. Dried Beans ..................................................................................................................................... 2 III. Dried Fruits and Nuts.................................................................................................................... 4 IV. Dried Commodities  Cocoa ........................................................................................................... 6 V. Food Processing Facilities ............................................................................................................... 7 VI. Mills and Processors ..................................................................................................................... 12 Appendix I   Sulfuryl Fluoride Case Studies in Flour Mills ............................................................. 17 Appendix II   Timing limitation in using phosphine on California dates ........................................ 24 I. Ham Question 1. MBTOC remains concerned about the lack of prior data on amount of MB used, about the amount of MB requested for 2007 and about the lack of sealing in ham houses which would result in higher use of MB overall. MBTOC understands the reasons for difficulty in obtaining MB use data for before 2005, but believes the USG may be able to obtain and provide this use data for 2005, in 2006 since any MB used in 2005 will be controlled by USG, MBTOC needs this information before it can recommend an amount of MB for 2007, though recognizing that it has not identified alternatives to MB for this particular use and conditions.

MBTOC's information gathering with MB distributors in the regions where this product is made in the US indicates that the likely maximum MB use is 35  40,000 lbs/ yr. We have obtained this number over two separate years of investigation and we therefore believe that the amount nominated may exceed the quantity needed for this use considerably. We are also asking if, considering that actual MB use in this sector we believe is likely to be a maximum of 40,000 lbs, and since the MOP Prague granted 67 tonnes, if there will not be sufficient MB already granted to this sector to meet its needs for a couple of years.

The CUN indicates, and informal communications with persons who know about Southern US ham house operations indicate, the structures are likely to be quite poorly sealed. We have asked all Parties with CUN applications that indicate poorly sealed structures what they plan to do to ensure the structures are of good gastightness before MB is used. MBTOC believes that the use of MB in very poorly sealed structures does not meet the requirements of Decision IX/ 6. Page 2 Although we acknowledge that there may be no alternatives for this use, we also note that there does not seem to be any research effort to find an alternative although it is required by Decision IX/ 6. MBTOC has seen other Parties continue to conduct research on the other, similar, very difficult applications such as cheese and fresh chestnuts and encourages USG to conduct investigations of the ham operations and/ or research on alternatives. In this instance it also appears that there is scope for improvements in IPM, and specifically in decreasing the conditions that lead to infestation and need for treatment with MB.

ANSWER: USG requested amounts of methyl bromide from this sector based upon several sources, including the manufacturer and application companies.

We are unable to address MBTOC's concerns regarding lack of sealing in ham houses. It is USG's understanding that this sector has been sealing their buildings to increase gas tightness and reduce emissions. Unfortunately, due to the communication problems and the unique nature of this sector there appears to be some disconnect between the air tightness during the drying and aging process and the sealing and gas tightness during the fumigation process. Sealing to provide a gas tight structure is a label requirement and in our discussions with fumigation companies in this sector they have described they comply with these label requirements. Several of the applicants have built new facilities that are highly gas tight and easier to sanitize. Additionally, we realize that this is a small sector with a diverse range of sizes and building materials.

This is a small sector that has had very little research. One reason is that there were no registered alternatives, except phosphine in a few of the states. It was due to efforts to use phosphine as a replacement for methyl bromide that it was discovered that phosphine did not control mites. Recently this sector has been working with USDA. Also, this commodity has recently received a tolerance for sulfuryl fluoride on July 15, 2005. This industry hopes to begin testing sulfuryl fluoride to determine how to incorporate it into their IPM strategies.

With respect to the comment on the 67 ton approval for 2005, the United States does not allow CUEs approved for 2005 to carry through to future years, so this amount is not available for use in 2007 and therefore does not resolve the issue. Our estimates of use were made from the best available expert opinion and at this time we do not have a basis to revise our estimate to a different nominated amount. We would be interested in obtaining the use estimates obtained by MBTOC to ascertain their accuracy and comprehensiveness. The United States supports proper emission minimzation techniques, which are beneficial from a human health and environment perspectice, and may also be economically advantageous in reducing the cost of application of methyl bromide. We are currently working with relevant industry groups to collect more accurate data on methyl bromide usage, identifying research programs, and selecting methods to improve sealing where it is techncially and economically feasible.

II. Dried Beans Question 2. On the basis of discussions with California fumigators, MBTOC believes that if beans are listed on the California phosphine label and the location is otherwise suitable for phosphine fumigation, then phosphine would seem to be approved for dried beans in California, regardless of Page 3 whether they are infested with cow pea weevil or another pest. MBTOC requests that USG obtain an interpretation of the approval to use phosphine for dried beans from State of California. Phosphine is used for this same purpose in the United States.

ANSWER: Originally the U. S. believed there were two reasons why the California Bean Shippers Association had a critical need for methyl bromide. They could not meet the sanitation requirements in a timely fashion with phosphine ( because of the extra time to treat the beans) and some counties in California would not allow the use of phosphine on their key pests ( regulatory constraint). Currently, the U. S. understands that there are no regulatory constraints on the use of phosphine. However, the problem of delays when using phosphine to treat the dried beans still exists.

In consultation with the California Bean Shippers Association, USG has determined that regulations in California no longer require that the pest be on the label. Therefore, it is now allowable to use phosphine on beans in California even though the cowpea weevil, the major pest affecting these beans, is not listed on the label. However, this does not change the fact that the longer time required for a phosphine fumigation ( a methyl bromide fumigation requires 12 hours but a phosphine fumigation requires 72 hours) would necessitate additional fumigation capacity be installed.

Harvest season for garbanzos is June and July with an average of 10 15 truckloads ( or approximately 2000 Cwt) delivered daily to each warehouse. Fumigation with methyl bromide is set to begin each day by 4 pm with completion by early morning the next day. The 12 hour time required to fumigate with methyl bromide is critical to keeping up with the truckloads of beans arriving from the harvest on a daily basis. Harvest season for blackeyes in California is September through November with an average of 10 15 truckloads ( or 2000 Cwt.) delivered daily to each warehouse. In order to accept the blackeye harvest all of the garbanzo bean harvest must be fumigated, cleaned and graded by September.

To show the importance of the 12 hour fumigant, imagine harvest of garbanzos, a 7 day per week operation using a 72 hour fumigant. On Monday 2000 Cwt arrives and is set for fumigation at 4 pm that same day. With phosphine the treatment will not be complete until Thursday pm, 72 hours later. Harvest is continuing daily with now an additional 6000 Cwt of beans sitting and waiting to be fumigated. By the end of week two you would have an 18000 Cwt backlog. Using this cycle it would be impossible to have the garbanzo beans fumigated, cleaned, graded and stored prior to the start of the blackeye harvest.

If the use of methyl bromide is taken from these warehouses they would have to triple or quadruple their capacity for fumigation in order to accommodate the 36  72 hours under optimal conditions required for phosphine. At the projected cost of $ 50,000 to build a fumigation chamber with the additional cost of $ 5,000 land costs per additional chamber at current market prices they are looking at a minimum, a half million dollar investment to use any product that requires more than 12 hours. At the current price of beans this would easily eliminate any profit margin, which in the current market is minimal. It would definitely in the case of these warehouses put them out of business. Page 4 In addition, shipments of both kinds of beans are made year round; however, the heaviest shipping months are October, November, and December as 60%   90% of the blackeye beans are shipped to the Southeastern United States in time for New Year's celebrations. Shipments are based on customers demand frequently with only a 2 day notification from the buyer. It is impossible for the warehouses to treat with any thing more than a 12 hour fumigant. Until an alternative is registered in California that is a 12 hour fumigant, methyl bromide remains the only product that is technically feasible for this industry.

However, the California Bean Shippers Association has begun to work with Dow, now that California has registered Profume ® , to test sulfuryl fluoride in this industry. The industry is concerned about adequate egg kill as this is critical to keeping their product clean. In addition the fumigation treatment time will have to meet the needs of the bean industry to meet receiving and shipment requirements. The industry is planning to test reducing treatment time by increasing the rates which could conceivably make it competitive with methyl bromide. This however will come at an increased cost of product that may make it economically not feasible for this industry. The California Bean Shippers Association will be looking at both the rate of egg kill and comparing the actual costs of fumigation in their upcoming studies. Although this applicant does not yet have the results of these investigations they are hopeful that this product will work for them, but they will still need time to transition.

III. Dried Fruits and Nuts Question 3. As the CUN indicates, adoption of gas forms of phosphine in this sector and in the State of California is very significant and is proceeding very quickly. Furthermore, MBTOC's information gathering indicates it is likely that the main pistachio processor will be 85% converted to phosphine by 2007. It is difficult therefore for MBTOC to interpret the need for MB in this instance as critical when a technically effective and commercially adopted alternative is in use in a very high percentage of operations in the same sector in the same state. MBTOC therefore has difficulty finding that this CUN fully complies with the requirements of Decision IX/ 6. However, USG may wish to correct this impression with data from the sector if MBTOC is incorrect.

ANSWER: The California Pistachio Commission has indicated that phosphine is actually their fumigant of choice. However, when the weather cools, it can take many days to fumigate and de gas with phosphine, up to 10 days. Additionally, processors can get an order that needs to be filled within 3 4 days, which does not allow for phosphine due to the increase in time required. It is under these conditions that methyl bromide becomes critical for meeting the market demands.

In addition, it is also a matter of staging areas. Paramount handles about 60% of the industry and within just a couple years that will mean about 250 million pounds of pistachios. If there are no fluctuations in shipping, 1 million pounds every business day need to be shipped. Use of phosphine exclusively would require that the industry have the capacity to have 10 million pounds of product in some stage of fumigation. So, while quick turnaround orders are the most significant issue, general handling will continue to emerge as an issue. Page 5 Question 4. MBTOC also wanted to know if the dates included in the CUN were dried or were fresh moist dates. MBTOC has not yet identified an alternative to fresh moist dates, but there are alternatives for dried dates. Unless we are mistaken, dried dates do not seem to be under timesensitive marketing pressure, so phosphine could be used.

ANSWER: Although California dates are usually thought of as another dried fruit, they are not. The USDA and Perishable Agricultural Commodities Act consider harvested dates as fresh and their regulations describe them as such. When harvested they have about the same moisture as when they are packed   ( 15  23%). California Dates are not dehydrated as raisins ( dried grapes) or as prunes ( dried plums). Only a small proportion of fruit is dehydrated for diced dates and other by products but this takes place after this fruit has been fumigated when it was newly harvested.

Actually, timing is critical to the California dates, whether fresh or dried. Harvest of dates in California begins in late September and early October, but the peak harvest occurs in November and early December. The dates are fumigated first, then processed, then shipped to customers. With methyl bromide this period takes 2 weeks, with the first harvest reaching store shelves by late October, and the last harvest by the end of December. Using phosphine adds an additional week to this timetable, so that the first harvest misses late October and the last misses end of December, thereby missing the holiday cooking season.

There is also an economic burden associated with phosphine. Because phosphine requires a longer fumigation, there would be a need for additional bins to handle the dates that have to be continuously harvested. Similar to the case with beans, there would need to be additional fumigation chambers built, with the additional land costs, labor costs would increase to handle the additional bins, and the date packaging plants would miss the target windows at both the beginning and the end of the U. S. holiday baking season.

Question 5. MBTOC believes that by giving an ' Unable to Assess' evaluation at this time, USG would have time to reassess its needs for this sector, both in terms of which commodities were included and the amount of MB that is requested for each sector.

ANSWER As we have explained in the answers to questions 3 and 4 above, we do not believe additional time is needed for the USG to assess need in this sector. The U. S. Government endeavors to provide the best possible information and expert judgement to MBTOC so that MBTOC can make an informed recommendation. We have put forward our nominations this year because of a conscious choice to seek clearcut MBTOC recommnedations and decisions from the Parties by the end of 2005. We do this, among other reasons, because we have our own domestic regulatory system that involves full notice and comment public participatory rulemaking as part of the process of making domestic allocations of methyl bromide. We therefore request that given the responses to the substantive questions above, we be provided with a recommendation for this sector. It is also important to note that as part of that domestic rulemaking process, the U. S. Government does take into account additional information on changes in circumstances before allocating amounts of methyl bromide. This is accomplished through our notice and comment rulemaking process. As explained ( below) as part of this process there is provision for the publc Page 6 to comment on all data and assumption used in a rulemaking. All significant comments must be addressed. This requirement is judicially enforceable.

IV. Dried Commodities  Cocoa Question 6. In other years MBTOC has received CUNs from Parties where all or part of the CUN looked like it might be a QPS application. QPS uses do not fit into the critical use nomination process and so similar to the other cases we have dealt with, MBTOC has sent this CUN back for further consideration by the Party. In this instance, MBTOC wonders if the segment of US cocoa imports that are required by USFDA to be treated under official control should be considered QPS treatments. Using the most recent year of US import statistics, and using the most recent list of countries on the US FDA mandatory treatment list, this would be about 30% of cocoa bean imports. If so, the CUN nominated amount would be considerably decreased. An ' Unable to Assess' nomination at this time gives USG some time to make a determination on this issue.

The CUN does not contain a lot of information about the logistics of cocoa bean import, treatment and storage. Although MBTOC has reviewed the paper by Marcotte and Sansone ( 2005), it too is lacking information about the ability, or not, to use phosphine on cocoa beans destined for long term storage or for re fumigations of long term stored cocoa beans. Since phosphine is used for cocoa beans in many countries, MBTOC considers phosphine to be a technically effective alternative; whether it is economically feasible and could be commercially adapted in the US context are outstanding questions.

The response to questions obtained from the USG indicates cocoa beans are MB treated only once in the US but this does not appear to be consistent with interviews from the cocoa merchants and warehouse managers. Cocoa in the US is apparently treated first on import and then second, before shipment to chocolate manufacturers. It can also be treated more than twice if re infestation happens in certain warehouses. Since any treatment of cocoa beans by MB is one of MBTOC more contentious issues faced by MBTOC, MBTOC finds it difficult to justify repeated fumigations by MB. The paper by Marcotte and Sansone contained some recommendations that might assist USG to work with the cocoa bean marketing channel partners to reduce MB refumigations and reduce the amount in the nomination. Alternatively the USG may wish to clarify this issue further.

ANSWER: The U. S. Government has reviewed the circumstances of the cocoa nomination and believes this use does not qualify for methyl bromide under the QPS exemption. An automatic detention is mandated by US FDA; however it is not for a quarantine pest, nor is methyl bromide the specified fumigant. Therefore, USG does not think this meets the QPS exemption requirements. US FDA orders detention of adulterated beans and then leaves it to the owner to propose a remediation method. There does not yet appear to be other feasible fumigation treatments at this time.

Cocoa beans are typically fumigated with methyl bromide twice. The beans are usually infested with pests while in the hold of a ship; therefore, the beans are always fumigated when they come off the ship. Then the cocoa beans are usually fumigated at least one more time just before they go to the chocolate manufacturing facility. The primary difficulty is the warehousing. Most warehouses at the Page 7 docks are old, constantly being reinfested with pests from the ships coming into port, and loaded to the rafters with cocoa beans. Although all the warehouses are certified by the Cocoa Merchants' Association, this certification does not mean that a warehouse has separate staging areas for new product or that the newly arriving product is sufficiently sealed off from existing ( stored) product so as to eliminate the possibility of reinfestation.

Although phosphine is labeled for cocoa beans, there are label restrictions that limit its use in these warehouse situations. Phosphine label instructions do not permit use of a warehouse while beans are under gas. The exposure period for phosphine is generally 72 hours, plus 1 2 days for aeration, which shuts down a warehouse for 5 days or so. When methyl bromide is used, the fumigation is on Friday night, aeration begins Saturday night and the warehouse is open again on Monday morning. If phosphine were used for fumigation, shipments of beans could not go in or out for periods of 5 days at a time as the warehouse would be closed for this entire period. In addition, the industry would be limited in colder weather, as phosphine cannot be used at temperatures below 40 ° F, and requires longer fumigation time at lower temperatures.

V. Food Processing Facilities Question 7. First, the critical need for MB use in bakeries has not been well justified. Little data has been submitted by USG to MBTOC to support the critical need for MB and the lack of technical availability or economic feasibility of the main alternative, heat. Bakery ingredients and foods cannot be heat treated but neither can they be MB treated.

ANSWER: The critical need for MB and information on the technical and economical feasibility of alternatives for bakeries does not differ significantly from information already submitted on the subject for mills, pet food, rice mills, or other similar food handling facilities.

Although heat treatment is very effective in inactivating insects, it is not without significant risks. Its best application is in a controlled room environment, with a " temperature safe" structure, with the absence of electronic and heat sensitive equipment. In medium to large food plants the use of heat may not be practical and may not be economically feasible. Here are a few key points illustrating the limitations:   For successful use of heat, expensive equipment which contains sophisticated electronics should be removed from the area to be heated. Although some equipment can be purchased that is capable of withstanding higher temperatures, some existing equipment is not so rated. In addition many electronic controls are used in the modern plant and if these are exposed to elevated temperatures or hot spots the likelihood of a startup failure is possible.   Hot Spots. In large food plants with high ceilings and large floor spaces there can be areas to be treated that are up to 2.5 million cubic feet. Although this is not typical, areas even one half this size are a challenge to heat evenly, regardless of extra fans and other equipment that could be used to assure a controlled heat up. Hot spots can result in damage to buildings. Also, some areas are not well insulated and in some cases have windows with limited insulation capability making maintaining heat at insect control temperatures impractical or even impossible. Page 8   The time required for heat treatments is another concern. Even if heating / heat up is done by a contractor, the time to heat the facility safely without concern for structural damage is not reasonable. The general rule is that you should not exceed temperature increases or decreases of ten degrees per hour, which if you would elevate from a base temperature of 70 F to 140F would take 7 hours to heat the facility with an abundance of heat but more likely it takes 7 hours to gain that temperature from 115 to 140F. More of a challenge is the cool down which takes considerable time to assure that the facility can be cooled for employees to be able to return to these areas to work. The other obvious concern is the cost of heat ( BTUs) to heat a facility.   Prior to any heat treatment each facility must go under a structural review by an engineering firm to be assured that the facility is capable of withstanding the variations in temperatures typical for a successful insect kill. In many cases enhancements are needed to assure that damage will not be sustained during the treatment. Large facilities have been shown to need significant upgrades which require large capital investments ( e. g. roof replacement). Additionally the long term impact of heat is not known, especially of older facilities which are not designed for exposure to elevated temperatures.   Electrical components and wiring are a concern as well. The National Electric Code speaks to derating of electronic wiring at elevated temperatures. Derating of circuits which must remain active during heat treatments can result in circuit overload unexpected shut down of equipment. Efforts can be made to protect some electrical components but wiring cannot be upgraded to compensate for derating without tremendous expense. Unplanned shut down of equipment is extremely costly and therefore is not acceptable from a business perspective.   The retrofitting of older facilities can be economically prohibitive. Incorporating new sprinkler systems, electrical components and wiring, and other building components to withstand heat fumigations can be very expensive.

The statement that bakery ingredients and foods cannot be treated with methyl bromide is inaccurate. US regulations at 40 CFR ( Code of Federal Regulations) 180.123( a)( 2)( i) do permit residuals of inorganic bromide resulting from fumigations with methyl bromide. In the US, methyl bromide is labeled for use on processed foods, However, the bakery applicants did not request methyl bromide for use on their ingredients or processed foods, only for their structures.

Question 8. The amount of MB used in bakeries places it as the second highest post harvest use of MB world wide, second only to US mills, yet the CUN does not present information on emissions control aspects for bakeries, research on alternatives, adoption of heat treatment in bakeries or justification for MB use in bakeries, and especially for an increase in use. There is more MB requested for US bakeries than for several US pre plant uses, yet there is an extensive US research program for those soil uses.

ANSWER: There is research information in the " Structures   Food Facilities" " submission from the USG pertaining to bakeries, this is the only chapter from the U. S. that includes bakeries. The increase in the nomination amount is to provide methyl bromide to facilities where alternative treatments have been tested and shown not to effectively control the target pests. Page 9 Question 9. MBTOC is also concerned that since there are two US CUNs including bakeries, USG might not have considered the extent of use of MB for bakeries, and including an apparent increase in this sector.

ANSWER: The USG nomination for bakeries is only in the " Structures Food Facilities" chapter. The " Post Harvest NPMA" sector does not include bakeries. The " Post Harvest NPMA" chapter does include some processed foods and their facilities, but the main difference is that it has included the treatment of the processed foods in the nomination. With regards to heat, most processed foods and their ingredients cannot be heat treated simply because heat does not penetrate well, especially through dense material such as processed flour. A research trial conducted on pasta revealed that heat penetration through a tote of product would require close to seven days for full penetration during which time condensation inside packaging became a problem. In addition, subjecting certain ingredients or food items to high heat can affect their baking quality or cause degradation of the material Question 10. MBTOC has been presented with information from the supplier of heat treatment equipment telling us that heat treatments have been successful in bakeries. In the absence of data indicating otherwise, MBTOC is considering whether heat treatment should be technically and economically feasible for many bakeries, and therefore whether MB treatment for bakeries fully complies with Decision IX/ 6. It is possible that USG would wish to correct us on this point by providing detailed sector specific information on the technical and/ or economic infeasibility of heat treatment or other alternatives. MBTOC needs more detailed information about this sector, the need for MB, valid reasons by heat can not be used as a disinfestation treatment for bakeries, research on alternatives in bakeries, IPM measures in bakeries to decreased the frequency of fumigation and how bakeries are sealed for MB treatments to ensure overall low MB use.

ANSWER: Many valid concerns are associated with the use of heat treatments in bakeries or similar food handling facilities. Chief among the concerns is the economic feasibility of heat treatments. In a recent assessment by a bakery company, restructuring for heat treatments ( to eliminate the use of MB) was estimated to average 3 million US dollars per facility The engineering firm assessing the structures examined boiler capacity, building structure, roof material replacements, sprinkler system upgrades, PLCs moved or cooled, and numerous other items. In addition to restructuring costs, there is the cost associated with the actual heat treatment. Heat treatments typically need to be scheduled on a more frequent basis than a MB fumigation which leads to additional downtime costs. Companies that contract heat treatments typically spend two to three times the cost of a MB fumigation The lack of long term studies of heat stress caused by expansion and contraction over repeated heat treatments has not been the subject of research by those who purvey heat treatments for financial gain. There has been the expectation, by some, that because heat can kill insects that it should be accepted as an alternative to methyl bromide without full consideration of the potential negative effects upon structures and electrical components and wiring in food plants.. It is a fact that electric wiring when utilized during periods of high temperature, such as heat treatment, is " derated" meaning, in effect, Page 10 that it loses capacity. Such loss may render the electrical circuit in violation of the National Electric Code and may overload circuits resulting in shut down of plant systems. Although efforts can be taken to protect sensitive electronic systems and minimize their use during heat treatments, it is not predictable that facilities would be able to always adequately protect or limit use ( in particular, the effects of structural wall movements and derating on electrical wiring). Electrical wiring that is derated by heat over time has the potential to cause wiring to carry less current. Additionally, damage to wire insulation over time due to heat stress may not be noticed and has the potential for arcing between wires which can result in fire or explosion hazards Although heat treatment is very effective in inactivating insects, it is not without significant risks. Its best application is in a controlled room environment, with a " temperature safe" structure, with the absence of electronic and heat sensitive equipment. In medium to large food plants the use of heat may not be practical and may not be economically feasible. Here are a few key points illustrating the limitations:   For successful use of heat, expensive equipment which contains sophisticated electronics should be removed from the area to be heated. Although some equipment can be purchased that is capable of withstanding higher temperatures, some existing equipment is not so rated. In addition many electronic controls are used in the modern plant and if these are exposed to elevated temperatures or hot spots the likelihood of a startup failure is possible.   Hot Spots. In large food plants with high ceilings and large floor spaces there can be areas to be treated that are up to 2.5 million cubic feet. Although this is not typical, areas even a half this size are a challenge to heat evenly, regardless of extra fans and other equipment that could be used to assure a controlled heat up. Hot spots can result in damage to buildings. Also, some areas are not well insulated and in some cases have windows with limited insulation capability making maintaining heat at insect control temperatures impractical or even impossible .   The time required for heat treatments is another concern. Even if heating / heat up is done by a contractor, the time to heat the facility safely without concern for structural damage is not reasonable. The general rule is that you should not exceed temperature increases or decreases of ten degrees per hour, which if you would elevate from a base temperature of 70 F to 140F would take 7 hours to heat the facility with an abundance of heat but more likely it takes 7 hours to gain that temperature from 115 to 140F. More of a challenge is the cool down which takes considerable time to assure that the facility can be cooled for employees to be able to return to these areas to work. The other obvious concern is the cost of heat ( BTUs) to heat a facility.   Prior to any heat treatment each facility must go under a structural review by an engineering firm to be assured that the facility is capable of withstanding the variations in temperatures typical for a successful insect kill. In many cases enhancements are needed to assure that damage will not be sustained during the treatment. Large facilities have been shown to need significant upgrades which require large capital investments ( e. g. roof replacement). Additionally the long term impact of heat is not known, especially of older facilities which are not designed for exposure to elevated temperatures.   Electrical components and wiring are a concern as well. The National Electric Code speaks to derating of electronic wiring at elevated temperatures. Derating of circuits which must remain active during heat treatments can result in circuit overload unexpected shut down of equipment. Efforts can be made to protect some electrical components but wiring cannot be upgraded to Page 11 compensate for derating without tremendous expense. Unplanned shut down of equipment is not acceptable from a business perspective.   The retrofitting of older facilities can be economically prohibitive. Incorporating new sprinkler systems, electrical components and wiring, and other building components to withstand heat fumigations can be very expensive.

Question 11. In pet foods, heat treatment is used in 20% of the pet food establishments according to the CUN. MBTOC is concerned that this adoption shows that heat is technically available and economically feasible, in the absence of data from USG showing otherwise. MBTOC members are aware that at least one large US pet food manufacturer relies entirely on spot heat treatments and has done so for several years. MBTOC acknowledges the reality that US legislation requires the same approvals and sanitation standards for pet foods as is required for human foods, but the CUN does not adequately justify the need for MB for pet foods. MBTOC has not been presented with detailed information about the facilities included in this sector ( Manufacturers? Warehouses? Retail establishments?), the need for MB, valid reasons why heat can not be used, research on alternatives for pet food establishments, IPM measures, and how pet food establishments are sealed to ensure overall low MB use.

ANSWER: This is correct, approximately 20% of PFI ( Pet Food Institute) plants use heat treatment. However, not all plants are suitable for heat treatments due to their construction ( e. g. wood), geographic locations ( colder climates), or the presence of finished products or ingredients that would be damaged by high heat. With regard to the major manufacturer that relies on heat, clearly there are portions of some facilities in certain areas containing certain products that are suitable for heat treatment. USG assumes the use of the word " spot" in MBTOC's statement refers to heat treatments in specific areas of a pet food facility. Heat, therefore, is one of many IPM tools, as is methyl bromide, but heat is not completely suitable for all areas or all plants.

USG thinks that the CUN does adequately justify the critical need for methyl bromide in pet food manufacturing facilities. In addition to government requirements that pet food products be free of insects, pet food consumers have a zero tolerance for any insect contaminants. For example, under many contractual arrangements, pet food manufacturers are required to compensate retailers for not only the cost of an insect contaminated product but also the profit from the lost retail sale. In addition, PFI survey research has indicated that insect contamination in a pet food product is a top consumer concern. Also, pet food is in many cases a branded product. That brand name has substantial value. Insect contamination in a pet food product has the potential to cause substantial loss of market share and could permanently damage the brand.

PFI represents the companies that produce approximately 99 percent of the commercial dog and cat food sold in the United States. This information has been presented in each and every application since the start of this process. The facilities in question are located in 37 states across the country and range in age from less than five years to older than one hundred years. None of these production facilities is associated directly with a retail establishment on the property. Many, if not all, do have a warehouse or some form of storage facility connected with or adjacent to the production area. Page 12 In addition to the responses above, PFI is committed to improving pest management at member facilities. All PFI members constantly strive to maintain a pest free environment in their production locations. Better sanitation, chemical spot treatments, traps, insecticutors, and structural repair are all used to prevent infiltration by insects and to reduce the need for methyl bromide. However, there still exists the need to fumigate entire facilities. Heat treatment is not completely suitable for all facilities but research will continue. Other research is focused on insect growth regulators embedded into product packaging. Despite this research and all pest management practices there is still not a technically and economically viable alternative to periodic methyl bromide fumigation for those facilities in our nomination.

Question 12. In the category ' Other' included in this CUN are several commodities that can be phosphine treated. MBTOC needs to know why they cannot be phosphine treated in these particular instances. Are these commodities treated with MB as a result of infestation found at import, or is there some other reason that a fast treatment by MB is required instead of phosphine?

ANSWER: Fumigants of choice for treating spice commodities are ETO, PPO, and phosphine; however, a very small percentage of spices are fumigated with methyl bromide. The majority of spice commodity fumigations with MB are for quarantine or pre shipment requirement. Facilities that have an occasional need for fumigation can not justify the cost associated with vacuum chambers or irradiation methods ( example: occasional trailer fumigation every few years) and are using methyl bromide due to time constraints associated with phosphine. Time constraints for one company are due to demurrage fees of $ 200/ day associated with overseas containers.

Question 13. In the category ' herbs and spices', MBTOC seeks assurance that the MB is required for facilities and equipment and not herb and spice commodity. There are alternatives available for herb and spice commodity.

ANSWER: The request for methyl bromide is for the facilities where spices are blended into packages ( such as for pizza mixes) that are then added to pre packaged goods. These facilities are similar to grain mills in that there are silos, mixing areas, packaging areas, etc. Infestation in herb and spice blending facilities is not localized to machinery that can be spot heat treated. These facilities utilize methyl bromide to target pests present in inaccessible areas of the structure, not the ingredients or finished products that may be stored on site.

Fumigants of choice for treating spice commodities are ETO, PPO, and phosphine; however, a very small percentage of spices are fumigated with methyl bromide. The majority of spice commodity fumigations with methyl bromide are for quarantine or pre shipment requirement. Facilities that have an occasional need for fumigation can not justify the cost associated with vacuum chambers or irradiation methods ( example: occasional trailer fumigation every few years) and are using methyl bromide due to time constraints associated with phosphine. Time constraints for one company are due to demurrage fees of $ 200/ day associated with overseas containers.

VI. Mills and Processors Page 13 Question 14. Our comments about bakeries in the CUN discussed above also apply to the over 23 tonnes of MB requested for bakeries in this CUN ANSWER: Although heat treatment is very effective in inactivating insects, it is not without significant risks. Its best application is in a controlled room environment, with a " temperature safe" structure, with the absence of electronic and heat sensitive equipment. In medium to large food plants the use of heat may not be practical and may not be economically feasible. Here are a few key points illustrating the limitations:   For successful use of heat, expensive equipment which contains sophisticated electronics should be removed from the area to be heated. Although some equipment can be purchased that is capable of withstanding higher temperatures, some existing equipment is not so rated. In addition many electronic controls are used in the modern plant and if these are exposed to elevated temperatures or hot spots the likelihood of a startup failure is possible.   Hot Spots. In large food plants with high ceilings and large floor spaces there can be areas to be treated that are up to 2.5 million cubic feet. Although this is not typical, areas even a half this size are a challenge to heat evenly, regardless of extra fans and other equipment that could be used to assure a controlled heat up. Hot spots can result in damage to buildings. Also, some areas are not well insulated and in some cases have windows with limited insulation capability making maintaining heat at insect control temperatures impractical or even impossible .   The time required for heat treatments is another concern. Even if heating / heat up is done by a contractor, the time to heat the facility safely without concern for structural damage is not reasonable. The general rule is that you should not exceed temperature increases or decreases of ten degrees per hour, which if you would elevate from a base temperature of 70 F to 140F would take 7 hours to heat the facility with an abundance of heat but more likely it takes 7 hours to gain that temperature from 115 to 140F. More of a challenge is the cool down which takes considerable time to assure that the facility can be cooled for employees to be able to return to these areas to work. The other obvious concern is the cost of heat ( BTUs) to heat a facility.   Prior to any heat treatment each facility must go under a structural review by an engineering firm to be assured that the facility is capable of withstanding the variations in temperatures typical for a successful insect kill. In many cases enhancements are needed to assure that damage will not be sustained during the treatment. Large facilities have been shown to need significant upgrades which require large capital investments ( e. g. roof replacement). Additionally the long term impact of heat is not known, especially of older facilities which are not designed for exposure to elevated temperatures.   Electrical components and wiring are a concern as well. The National Electric Code speaks to derating of electronic wiring at elevated temperatures. Derating of circuits which must remain active during heat treatments can result in circuit overload unexpected shut down of equipment. Efforts can be made to protect some electrical components but wiring cannot be upgraded to compensate for derating without tremendous expense. Unplanned shut down of equipment is not acceptable from a business perspective.   The retrofitting of older facilities can be economically prohibitive. Incorporating new sprinkler systems, electrical components and wiring, and other building components to withstand heat fumigations can be very expensive. Page 14 The statement that bakery ingredients and foods cannot be treated with methyl bromide is inaccurate. In the US, methyl bromide is labeled for use on processed foods. US regulations at 40 CFR ( Code of Federal Regulations) 180.123( a)( 2)( i) do permit residuals of inorganic bromide resulting from fumigations with methyl bromide. However, the bakery applicants did not request methyl bromide for use on their ingredients or processed foods, only for their structures.

Question 15. The CUN requests MB for 2007, in 2005. Our secondary reason for giving this CUN an ' Unable to Assess' was our belief at the meeting in Argentina ( April 2005) that sulfuryl fluoride approval for mill applications in California was imminent. California approved SF for mills in May 2005. MBTOC is aware that a large California rice mill was booked for SF test fumigation immediately following the California approval and other millers would be watching this treatment with considerable interest. Licensed fumigators in California have already been trained and are ready to begin assisting mills with adoption, MBTOC could not recommend an MB amount for 2007 knowing that a major user sector would soon have access to an acknowledged alternative.

ANSWER: It is correct that SF was registered for certain uses by the State of California in May 2005. California is, therefore, approximately 18 months less experienced in conducting SF fumigations. This is important as evidence from successful fumigations is likely to be persuasive in facilitating adoption of this alternative. As illustrated by the submission ( below) from the one experience in a California rice mill, may facilities will require some repeat experience before they are comfortable concluding that SF is an appropriate alternative to fumigation with methyl bromide. The issue of cost differences, and thus economic feasibility, is still outstanding. USG has only been able to get information from one rice mill in California that used sulfuryl fluoride for a full fumigation using a 20 year veteran fumigator. This appears to be the first and only commercial application of Profume in that state. The mill operator has the following comments:

" Efficacy Gauging by pest traps placed inside, appeared to be equivalent ( 100% kills in traps) to Methyl Bromide ( MeBr) however this is the only fumigation using Profume that they have done. They don't have knowledge of efficacy on pest eggs. Costs Down time for the mill was longer than for Methyl Bromide, Material cost was substantially higher than the cost of MeBr, Setup costs were higher due to the computer monitoring points and piping required for Profume. Structure The mill is a new slip form concrete mill, designed for easy fumigation ( better sealed than older architecture). Comments: Computer controlled monitoring worked as advertised and applied product where needed in the structure. It was easier to ventilate. Has smaller ( state required) non occupied buffer zones. Was more costly than MeBr. Profume cannot replace MeBr's primary use in export containers because it permeates through the wooden container floors. Was used in a new, fumigation friendly mill. Does not know how it will work in older mills." The miller was encouraged but not convinced. He was not 100% satisfied. He requires more experience with it to determine if it can be a true replacement for MeBr.

Question 16. MBTOC needs to see how this sector will adopt SF, continue to adopt heat, make IPM improvements to decrease MB fumigation frequency and improve sealing to decrease overall use. We Page 15 believe a USG reassessment of these factors may result in a different amount of MB nominated for this sector.

ANSWER As MBTOC is aware the National Management Strategy will be provided to the Parties by February 2006 and we anticipate that many of these questions will be addressed in that document. The U. S. Government endeavors to provide the best possible information and expert judgement to MBTOC so that MBTOC can make an informed recommendation. We have put forward our nominations this year because of a conscious choice to seek clearcut MBTOC recommnedations and decisions from the Parties by the end of 2005. We do this, among other reasons, because we have our own domestic regulatory system that involves full notice and comment public participatory rulemaking as part of the process of making domestic allocations of methyl bromide. We therefore request that given the responses to MBTOC's substantive questions, we be provided with a recommendation for this sector. It is also important to note that as part of that domestic rulemaking process, the U. S. Government does take into account additional information on changes in circumstances before allocating amounts of methyl bromide. This is accomplished through our notice and comment rulemaking process. As explained ( below) as part of this process there is provision for the publc to comment on all data and assumption used in a rulemaking. All significant comments must be addressed, and this requirement is judicially enforceable.

In the US there is a process in place to take into account newer information in determining the amount of methyl bromide that will be allocated to critical needs. A requirement before any production to import of methyl bromide for critical uses can take place is that the proposal to allow it be put before the public in a notice and comment rule making. During this open and transparent process the public has the opportunity to comment on all aspects of the proposed rule. It is also a requirement, enforced by judicial review, that all significant comments must be addressed. If the situation with respect to availability and technical and economic feasibility of alternatives changes between the time that the Parties make a decision ( in response to a MBTOC recommendation) and the time that the USG proposes its allocation amount, that proposal can take those changes into account. If it does not do so, the public ( probably in the form of manufacturers of alternatives and environmental groups) will comment that the need for methyl bromide is less than had been the case when the decision was made by the Parties and that, therefore, the allocated amount should be lower. If this comment is not addressed, members of the public can seek to have a court invalidate the rule. This ` notice and comment' requirement is a powerful tool for incorporating new information into the internal allocation process. It acts to ensure that changes in the status of alternatives are taken into appropriate account Question 17. Concerning flour mills, MBTOC knows that adoption of SF and/ or heat treatment is continuing, although slower than the registrant or heat equipment suppliers would prefer, and slower than they tell us. MBTOC acknowledges the economic arguments presented in the CUN concerning costs of heat treatment in flour mills. However, MBTOC has also conducted many interviews with millers and fumigators. We see that USG's has reduced the 2007 CUN requested amount by about 15% and we believe that a 15% per year adoption level in the flour milling sector is quite likely. We do not have further questions for flour mills. Page 16 But as we indicated above, that 15% adoption level did not include the possibility of adoption of SF in California and we are seeking new data on adoption levels and possible revision of the nominated quantity for this CUN.

ANSWER The USG continues to use the best information we have available and our expert judgment in assessing our need for methyl bromide. As new information is developed and circumstances change, we are committed to accounting for it. With respect to the change in the registration status of SF in California, we have not had adequate time to collect relevant data and analyze it to assess how it might change the nominated quantity for this CUN for 2007. The shifting local, state and federal regulatory requirements have made the process of analyzing our need for methyl bromide extremely burdensome. However, we are currently in the process of developing our domestic 2006 CUE allocation rule by which methyl bromide is made available to those users that qualify for them. As part of that process, the USG will seek additional information relevant to assessing the impact of this registration, and having obtained better information will assess the impact of this new registration on our need for methyl bromide in 2006. Such an analysis will also be applied as part of our domestic allocation process for 2007 CUEs. Page 17 Appendix I   Sulfuryl Fluoride Case Studies in Flour Mills These data were provided to the USG and are a fumigating company's actual estimate of the cost to fumigate a mill with MB or SF. These estimates are based on targeting all life stages of the red flour beetle and the confused flour beetle. These estimates are illustrative of the significant difference in cost that may be faced by some facilities. We recognize that the cost differential in this estimate does not apply to all facilities, but the data nevertheless do demonstrate the significant economic impacts that some facilities may face with respect to the use of SF as a methyl bromide replacement.

ASSET UTILIZATION U. S. grain mills are under intense economic pressure. Profit margins are razor thin or non existent. Elimination of costs is the number one priority. Likewise, customer industries are also working to eliminate costs. This has resulted in a move toward ` just in time' delivery whereby inventories are reduced and deliveries are more frequent. At the same time, the customer's expectations for high quality, insect free products are nonnegotiable.

An industry operating on a 5 day schedule would have less difficulty completing downtime activities like fumigation as those tasks could be scheduled during weekends. To optimize efficiency, however, the milling industry must operate 24 hours per day for 6 days a week, and often operates round theclock 6.5 or 7 days per week. Downtime must be minimized as every hour the mill is out of production is an hour's revenue that can never be replaced.

The cost of lost revenue can be startling. For example, an average flour mill in the US produces about 1.0 million pounds each day. The sales price of industrial or non retail milled grain products is about $ 0.12 per pound. So, an additional day of downtime results in lost revenue of $ 120,000 that, again, can never be replaced in an industry striving for 24 7 operation.

With the trend of low carbohydrate fad diets abating, consumption of grain based foods is increasing. This will result in a corresponding increase in run time ( production) and additional pressure to minimize downtime.

CHOOSING THE RIGHT ALTERNATIVE As stated earlier, time is valuable and currently available alternatives require lots of preplanning. Whatever treatment is chosen, it must be effective the first time as there will be little time to repeat or ` redo' the treatment. Efficacy and downtime must be balanced, i. e. sufficient time must be allowed for slower acting alternatives to work, while still fitting into the ( increasingly smaller) time window.

Success will also be impacted by inadequate preparatory cleaning, structural limitations, low temperatures that reduce pest respiration and life stages of target pests.

Sulfuryl fluoride ( SF)

The adoption of SF as a replacement for MB has been hindered by 3 types of hurdles   legal, technical Page 18 and economic. Significant legal hindrances include: 1. very few international tolerances, precluding the use of SF in facilities when products may find their way into export channels. 2. No tolerances on enrichment   the niacin, thiamine, riboflavin, iron and folic acid fortifications that are added to milled grain products 3. No tolerances on ingredients such as sugar, oil, spices, etc. which precluded the use of SF in facilities where ingredients might be present 4. A label restriction which required flour exposed to SF be blended into non exposed flour in a 10: 1 ratio ( treated: untreated)

Important progress has been made on several of these hurdles. SF recently received tolerances on enrichment and ingredients, and the flour blending requirement has been dropped. Those new tolerances have yet to be registered by the states, but if and when they are it will be an important milestone achieved. The lack of international tolerances continues to be a legal hurdle.

When the legal hurdles are removed, technical and economic hurdles will remain. Industry experience thus far has been that SF does not compete technically or economically with methyl bromide.

These hurdles are briefly described in the following, real world examples. This is not intended to be an exhaustive list, rather it is a snapshot of the experiences described by milling companies.

Example 1 These data were provided to the USG and are a fumigating company's actual estimate of the cost to fumigate a mill with MB or SF. These estimates are based on targeting all life stages of the red flour beetle and the confused flour beetle. These estimates are illustrative of the significant difference in cost that may be faced by some facilities. We recognize that the cost differential in this estimate does not apply to all facilities, but the data nevertheless do demonstrate the significant economic impacts that some facilities may face with respect to the use of SF as a methyl bromide replacement Size of mill: 1.3 million cubic feet Assumed temperature: 82 F/ 28 C Fumigation Price:

Methyl Bromide $ 18,500.00 24 hour exposure period 12 hour HLT ( half loss time) 1,300 lbs. gas Sulfuryl Fluoride $ 48,000.00 36 hour exposure period 7  9 hours HLT 5,250 lbs. gas Page 19 Example 2 In this example, the quantities of SF necessary to control red flour beetles in a 1.8 million cubic foot mill were calculated at 2 target concentrations. The mill is of modern, slip form concrete construction and therefore represents a gas tightness much better than the average mill. For a 24 hour fumigation at 86 F/ 30 C, the quantities were:   Sulfuryl fluoride   eggs not targeted 3125 lbs   Sulfuryl fluoride  to control all life stages 5226 lbs   Historical quantity of methyl bromide 1800 lbs used to control all life stages in this mill At this point the impact of less than optimal temperature on the effectiveness of SF must be noted. At the same mill, managers dissatisfied with the first SF fumigation planned another attempt several months later. The temperature having dropped with the change of seasons resulted in an estimated quantity to control " all life stages" of approximately 13,000 pounds. All other considerations being equal, the miller would obviously have difficulty supporting a pest management regimen that requires a seven fold increase in pesticide usage.

Pesticide usage encompasses multiple serious issues in addition to the immediate goal of technical and economic feasibility. These include worker safety, community right to know laws, residue tolerances on foods, general public concern about pesticides and others. As a result, the trend is toward pest management solutions that rely on fewer pesticides  not more.

The " less than all life stages" dosage targets the larvae, pupae and adult insects, but not the eggs. This is not a reasonable option for mills. The eggs that are not killed with this treatment will hatch in about 30 days. The mill must then be idled yet again for a follow up fumigation. Therefore, the actual time to control all life stages at this dosage is 36 48 hours with a concurrent increase in lost revenue.

Example 3 In this example, a mill and warehouse were fumigated in May 2005. Sulfuryl fluoride was the principal treatment, with a few locations in the complex treated with either CO2 and phosphine in combination, or with a DDVP ( dichlorvos) fog.

Live insect traps were distributed throughout the facility to provide efficacy data. The traps were checked at the conclusion of the fumigation, and again 30 days later. The results follow:

Floor Location Treatment May 2, 2005 June 1, 2005 Mill and Packing Department 6 top of filter in cleaning house sulfuryl fluoride All dead Live larvae top of air lock table in A mill " All dead Live larvae Page 20 5 ledge on back wall in cleaning house " All dead All dead Top of air lock table in B mill " All dead Live larvae In phone box in A mill " All dead Live larvae On catwalk behind filter " All dead All dead Top of # 9 bin " All dead Live larvae in sieve screen drawer " All dead Live larvae 4 on catwalk in cleaning house " All dead Live larvae in # 1 filter room in B mill " All dead Live larvae In phone box in A mill " All dead Live larvae On top of packing bin under hatch door " All dead Live larvae Inside sifter in B mill ( closed) " All dead Live larvae Inside packer rebolt sifter ( open) " All dead Live larvae 3 On ledge on back wall in cleaning house " All dead Live larvae On purifier by stairwell in B mill " All dead All dead In phone box in A mill " All dead All dead In whole wheat roll stand in packing " All dead Live larvae Inside wheat germ classifier " All dead Live larvae 2 In locker in cleaning house " All dead All dead In roll stand by locker in B mill " All dead Live larvae In roll stand by window fan in A mill " All dead All dead In whole wheat sifter on packing side " All dead All dead On top of packer " All dead All dead On floor in corner in room over " All dead Live Page 21 packer larvae 1 On ledge of back wall in cleaning house " All dead Live larvae On corner wall by drain in B mill " All dead Live larvae On motor in cage in A mill " All dead Live larvae In front warehouse corner " All dead Live larvae Inside wheat germ hopper ( open) " All dead Live larvae Roll room " All dead All dead On # 4 bin hopper " All dead Live larvae Warehouse On top of palletizer " All dead Live larvae On pallet in rack " P" CO2/ phosphine in All dead Live larvae combination or Shop DDVP fogging 1 On top of tool box " All dead All alive Old warehouse by bakery office " All dead All alive 2 In bakery office " All dead Live adult By filter sock storage " All dead All dead At wheat germ metal detector " All dead Live adult By sifter sieve storage " All dead All dead Filter sock storage area by break room " All dead Live adult Bulk Plant 6 On slide by bin # 41 sulfuryl fluoride All dead All dead On ledge by bin # 83 " All dead All dead 5 In # 2 rebolt sifter " All dead All dead 4 On catwalk at top of ladder sulfuryl fluoride All dead All dead On top of scale bin " All dead All dead Page 22 3 On whole wheat bin slide " All dead All dead Man lift area " All dead All dead 2 On air lock of bin # 82 " All dead Live larvae 1 On conveyor at bin # 41 " All dead All dead More than half of the traps contained live infestation a mere 30 days after fumigation.

Example 4 This example shows the cost to treat a 1.6 million cubic foot mill with heat. As is typical for most mills, heating capacity at this mill is insufficient to achieve insecticidal levels so an outside contractor was brought in.

° Cost of heat treatment $ 25.74/ 1,000 cubic feet ° Historical average cost to fumigate $ 15.00/ 1,000 cubic feet this mill with methyl bromide Preparation $ 45,943 Post heat treatment repair $ 38,992 Net total cost for prep and repair: $ 79.06/ thousand cubic feet Other operational considerations include Also, milling equipment is not intended nor designed for high heat environments, and their manufacturers will not guarantee their performance. Exposure to high heat could void warranties. Likewise, it is known that high heat can cause structural damage to the facility. This raises significant safety concerns, liability issues and potentially jeopardizes insurance coverage.

SUMMARY Proponents of MB alternatives will look at these examples and criticize their " doom and gloom" perspective. True, there are situations where alternatives have proven to be feasible. However, it is a reality that alternatives do not compete well with methyl bromide on an economical basis at the current time when they are attempting to take away market share from methyl bromide. If methyl bromide were not available, it would defy basic laws of economics if the alternatives were to suddenly become cheaper.

Said another way, a product that does not compete well on price in a free market is unlikely to be priced more competitively when it enjoys a ( near) monopoly.

Regarding technical feasibility, the industry's understanding of the operational constraints associated with each alternative will improve. In fact, the industry has shown willingness to experiment with alternatives and share that information through its professional society. While the understanding of the strengths and limitations of an alternative will improve, the chemistry of the alternative itself will not Page 23 change. If an alternative damages buildings or does not kill eggs today, those shortcomings are not going to change.

In conclusion, the USG believes a 15 percent adoption rate is aggressive but achievable and will not revise the nominated quantity for this CUN. Page 24 Appendix II   Timing limitation in using phosphine on California dates The difficulties in using Phosphine to fumigate newly harvested dates effects the industry in two ways A; timing of harvest relative to peak market demand and B; the cost of extra equipment, labor and land necessary to make the transition.

A  TIMING OF HARVEST, FUMIGATION WITH PHOSPHINE, PROCESSING AND SALES OF CALIFORNIA DATES 1 Chart of harvest times 2 Schedule of fumigation rotation 3 Definitions 4 Expected market display dates for various harvest times.

1. Chart of harvest times 2   Activity Schedule in fumigation rotation Day Activity_______________ 1 Build stacks  Cover with tarp, seal  Apply Phosphine 2 Fumigate   24 hrs @ 6 pm 3 Fumigate   48 hrs @ 6 pm 4 Fumigate   72 hrs @ 6 pm 5 Uncover stack  Air out 6 Air out 7 Move fumigated bins   Build new stacks CALIFORNIA DATE HARVEST 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 Sept 2 Oct 1 Oct 2 Nov 1 Nov 2 Dec 1 Dec 2 SEMI MONTHLY PERIODS RELATIVE AMOUNTS Series1 Page 25 3  The following is a schedule of the typical timing of handling fresh California dates.

The time necessary to harvest dates and get them to be sold to the consumer is equal to; time of harvest + fumigation time + processing time + shipping time 1) Harvest: A majority of the fruit is picked from the middle of October until the end of November or the first week in December 2) Fumigation time = 7 days 3) Processing time: Time from end of fumigation until the fruit is packed into sale containers. = 10 days 4) Shipping time: Time from being packed, through cooling, loading, shipping to customer and placed on display. This time is thought to end in early December for the fruit to be sold that holiday season. Time is 3 to 7 days 4  Timing for in store display of dates by harvest time and method of fumigation:

Date of earliest display in store Date of Harvest MBr Phosphine Oct 16 Oct 30 Nov 6 Nov 1 Nov 15 Nov 22 Nov 16 Nov 30 Dec 7 Dec 1 Dec 15 Dec 22 Dec 16 Dec 30 Jan 7 B  SWITCHING TO PHOSPHINE   Cost of extra Equipment, Land and Labor.

1) Bin needs 2) Area needed to fumigate 3) Manpower needed 4) Additional equipment needed 5) Summary of Costs The following information is for a typical large packer Page 26 1. Number of bins tied up in Phosphine fumigation rotation.

No. of Stacks/ day Lbs. of Dates No. of Bins No. of bins per Rotation 1 90,000 108 756 2 180,000 216 1512 3 270,000 324 2268 4 360,000 432 3024 5 450,000 540 3880 Footnote: 1 stack = 108 bins 1 bin = 833 lbs 2   Area needed to fumigate with phosphine 2a  Accumulation of stacks No. of stacks under fumigation Day No. of Stacks Input Output 1 Mon 4 0 4 2 Tue 4 0 8 3 Wed 4 0 12 4 Thur 4 0 16 5 Fri 4 0 20 6 Sat 4 0 24 7 Sun 4 0 20 8 Mon 4 4 28 9 Tue 4 4 28 2b  Area per Stack Area needed is area covered by bins plus area outside stack for access to stack 3 bins wide X 6 bins long = 12 ft X 24 ft 3 ft added on each side for access = 18 ft X 30 ft.= 540 sq ft.

2c   Area needed for Fumigation rotation Number of stacks in rotation = 28 28 stacks X 540 sq ft / stack = 15,120 sq ft.

Comparison using MBr = 2160 sq ft.

*** Plus cost of preparation of the new fumigation area. Floor surface must be non adsorbent to fumigant. Page 27 3  Manpower Needed Estimated 4 extra laborers 4  Equipment Needed 7 times the Tarps 7 times the sand snakes 7 times the Tape The above information shows that it would be very risky for the California Date Industry to rely upon Phosphine to fumigate newly harvested fruit and attain successful and profitable sales during the holiday season.

Additionally it indicates that the added costs related to using Phosphine would impose upon the packer additional costs and further erode any market advantage which may exist.

This financial burden would weigh heavier on the smaller date packer who would find it relatively more costly to tie up fruit containers, purchase additional equipment and labor than would the larger packers.