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Title 7: Agriculture
Subtitle B: Regulations of the Department of Agriculture (Continued)
CHAPTER XIV: COMMODITY CREDIT CORPORATION, DEPARTMENT OF AGRICULTURE
SUBCHAPTER B: LOANS, PURCHASES, AND OTHER OPERATIONS
PART 1446: PEANUTS
Subpart E: Handling Contract Additional Peanuts-Physical Supervision
1446.504 - Substitution of quota and additional peanuts.
(a) Substitution of quota peanuts which have been exported?(1) Farmers stock peanuts. With prior notification to and approval of the marketing association, farmers stock quota peanuts that have been exported from the same crop, type, quality, and area may be substituted for additional peanuts that otherwise would have to be exported in accordance with this part to avoid a penalty.
(2) Milled peanuts. With prior notification to and approval by the marketing association, peanuts that are milled under supervision of the marketing association may be used to replace, in domestic edible use, quota peanuts that have been exported to an eligible country from the same crop, type, area, and of the same grade as recognized by the Peanut Administrative Committee (PAC) for edible quality grades. Such grades shall be established at the time the peanuts are milled and the lot is formed unless CCC directs otherwise in writing. The quota peanuts that are exported, for which substitution is requested, must have been positive lot identified and otherwise handled as additional peanuts under the supervision of the marketing association.
(b) Use of additional peanuts for domestic edible uses prior to substitution?(1) General requirements. Additional peanuts may be used for domestic edible use with prior notification and approval of the marketing association and upon presentation to the marketing association of an irrevocable letter of credit in an amount that is determined in the same manner as such handler's initial letter of credit for the quantity of peanuts that will be substituted. Such letter of credit is in addition to the letter of credit required in accordance this part as a condition for approval of contracts for additional peanuts. Such additional letter of credit for substitution shall be issued in a form and by a bank which is acceptable to CCC.
(2) Submitting evidence of export. The handler subsequently shall dispose of a like amount of quota peanuts in the manner prescribed in this part for contract additional peanuts. If the quota peanuts are exported, the handler shall subsequently deliver to the marketing association satisfactory evidence that a like amount of quota peanuts of the same type and of a similar grade has been exported. Such evidence must be submitted no later than the earlier of:
(i) 30 days after the final date for export as established in accordance with this part; or
(ii) 15 days prior to the expiration of the letter of credit.
(3) Failure to timely submit evidence of export. If satisfactory evidence is not presented by such date determined in (b)(2) of this section, CCC may authorize the marketing association to draw against the letter of credit for the full amount of the penalty which would otherwise be due for failure to dispose of contract additional peanuts in accordance with this part.
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