April 22, 1998


INFORMATIONAL MEMORANDUM: R&D-98-014

TO:      All Reinsured Companies
         All Risk Management Field Offices

FROM:    Tim B.  Witt/s/ Tim B. Witt
         Deputy Administrator

SUBJECT: Definition of Local Market Price in the Dry Pea Crop Provisions

BACKGROUND:

The final rule for the 1998 dry pea regulations published in the Federal
Register on December 16, 1997, contained an error in the definition of
"Local Market Price."  The definition referenced the cash price per
pound for the U.S. No. 2 grade of dry peas and should have referenced
the cash price per pound for the U.S. No. 1 grade.  Dry pea production
grading U.S. No. 2 or worse is eligible for quality adjustment.  The
local market price is used in adjusting the production to meet the dry
pea grade standard of U.S. No. 1.  Based on the incorrect definition of
"Local Market Price" in the 1998 dry pea regulations, there would not be
any quality adjustment for dry pea production grading U.S. No. 2 or
worse.

ACTION:

For the 1998 crop year, the cash price per pound for the U.S. No. 1
grade will be used for dry peas and lentils that qualify for quality
adjustment.  The 1998 Dry Pea Crop Handbook provides procedures for
determining quality adjustment for dry peas and lentils.

A technical correction for the dry pea regulations to correct this error
will be effective for the 1999 crop year.  Upon publication of the
correction in the Federal Register, new Dry Pea Crop Provisions for the
1999 crop year will be issued.