More than 5,000 cartons of cantaloupes were shipped back to Costa Rica Feb. 2, resulting in a total loss because the pallets they were shipped on were not certified as pest- free.

The rejection was the first known case involving Phase 2 of the new standard for Imported Wood Packaging Material, published by the U.S. Department of Agriculture's Animal & Plant Health Inspection Service and enforced by the Department of Homeland Security and its Customs & Border Protection Department.

APHIS published the final rule last year and included a phased-in enforcement period. During Phase 1 -- Sept. 16, 2005 through Jan. 31, 2006 -- importers and exporters not in compliance with the new rule, which was designed to keep harmful pests out of the United States, were basically informed about the new rule and given what amounted to a warning. Phase 2 began Feb. 1 and runs through July 4. During this phase, rejection of crates and pallets that do not comply with the standard is up to the discretion of the port director. Each port is given the authority to allow for trans-shipment on certified pallets or in certified crates, or they can reject loads in violation by simply forcing them to be shipped back to their source.

On July 5, full enforcement on all articles of regulated wood packing materials entering the United States will begin. Accepting a load and allowing it to be transferred to compliant material will no longer be an option. In a notice from APHIS published in September and updated Feb. 2, the agency "strongly encouraged" importers and suppliers of U.S. imports "to have all regulated wood packing material meet the ISPM 15 standard to avoid delays or rejection of WPM."

Though shippers generally appear to be in compliance, at least one load has been rejected as the Los Angeles port director followed the path of full enforcement the first couple of days after Phase 2 was implemented.

Speaking from his Costa Rica office, Roger Oswalt of Roger Oswalt Produce Inc. in El Centro, CA, agreed to the tell The Produce News his story as a warning to other shippers. As Mr. Oswalt told it, five containers of cantaloupes totaling close to 5,500 cartons were loaded in Costa Rica in the latter part of January. He said that the pallet company his firm uses does heat-treat the pallet material as required by law. However, he said it apparently did not stamp the vast majority of pallets used in his shipment.

According to the APHIS regulation, a pallet or a container that does not have the necessary stamp is presumed to be non-compliant. The containers arrived Feb. 2 on an APL ship in the Los Angeles port and were off-loaded over the next couple of days. The inspectors noted the non-compliant pallets and would not allow the pallets to enter U.S. commerce.

Though there is a provision in the regulation during Phase 2 that would allow for the transfer of the cartons from non-compliant pallets to compliant pallets, Mr. Oswalt and his custom house brokers in Los Angeles were not able to convince the port director to allow them to take this step. The shipper said that the port director reasoned that he did not have the manpower to allow the supervision of this operation.

Mr. Oswalt's representatives attempted to have the port director use his discretion in allowing this step, but they were unsuccessful. Among those arguing the case on behalf of Oswalt Produce was Western Growers Association, of which the firm is a member. A WGA representative said that the association staff researched the issue and found that the final authority did lie with the port director and he was well within his rights to reject the load.

The association spokesperson said that the port director apparently did not want to set a precedent that would allow for a continual barrage of trans-shipments from non- compliant pallets and containers to compliant pallets and containers.

Mr. Oswalt said that after the final decision, he had 72 hours in which to book return shipment for the cantaloupes. "They were frozen and put back on the APL ship. I think it departs L.A. today," he told The Produce News Feb. 13. Mr. Oswalt said that the cantaloupes were frozen or they would have decayed badly during the 50 days that it will take them to get back to Costa Rica, where the load and pallets will be destroyed. "The ship doesn't turn around and come right back to Central America. First it heads up to Canada and then to Asia," he said.

With the melon market approaching $20 f.o.b. and figuring in the double freight rate and the cost of destroying the load, "We are talking about losses in the tens of thousands of dollars," he added.

Cathy Sauceda, director of the Special Enforcement Office of Field Operations/Trade Programs for the U.S. Customs & Border Protection, issued the following statement to The Produce News via e-mail: "Phase 2 has been implemented successfully. For the first 12 days of February, we had 348 noncompliant shipments. Most of the noncompliance has been on the southern border, with Houston having the largest number of noncompliant shipments. It appears that the discrepancy rate for noncompliant wood packaging material is 1.53 percent."