CLA-2:CO:R:C:G 082090 JAS
Mr. James R. Allen
Research Products Company
P.O. Box 1460
Salina, Kansas 67402-1460
RE: Prefabricated grain storage units
Dear Mr. Allen:
In your letter of February 19, 1988, you inquire as to
the tariff classification of prefabricated grain storage units
from Brazil. You forwarded more detailed information on
April 29, 1988.
Submitted literature describes the AGRAPORT self-
supporting warehouse. It is advertised as a grain storage
warehouse and as a bulk storage facility which costs less to
build and operate than conventional flat bulk storage units of
the same capacity.
The AGRAPORT is a quonset-style structure consisting of a
semicircular arched roof of self-supporting corrugated steel
panels, joined side by side into rigid arches with a maximum
width of 121 ft. 3 in. Large sliding doors provide access.
The AGRAPORT can rest on a concrete slab (not a part of the
importation) or on compacted earth with only concrete consoles
at each end in which anchor plates are set. It has louvered
end panels for ventilation, fiberglass panels for illumina-
tion, and steel beam structures at each end to support the end
panels.
Inloading and outloading are accomplished by overhead and
underground conveyors. As probes with thermocouples suspended
from the ceiling sense hot spots on the floor, the end panels
are opened or closed either by computer or manually by the
warehouse operator. When completed, the AGRAPORT has a grain
capacity of 10,000-20,000 metric tons (365,000-730,000
bushels). You indicate these units will be marketed to U.S.
grain handlers.
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Bulk storage facilities such as the AGRAPORT are
classifiable under the provision for other structures and
parts of structures, of base metal, in item 653.00, Tariff
Schedules of the United States (TSUS), dutiable at the rate of
5.7 percent ad valorem.
Item 870.40, TSUS, is a duty-free provision covering
machinery, equipment, and implements to be used for agricul-
tural or horticultural purposes. Structures ordinarily
classifiable in item 653.00, TSUS, would be eligible for duty-
free entry under item 870.40, TSUS, provided they are actually
used by a farmer on a farm, and relate directly to the
production or preservation of an agricultural product, or as
shelters for farm animals.
Item 870.40 does not apply, for example, to structures
such as tool shops or vehicle maintenance buildings which may
be used on the farm but have no direct relationship to the
production of food or the raising of animals. Item 870.40
also does not apply to articles used by a co-op or similar
non-farm user.
Item 870.40, TSUS, would apply to the AGRAPORT bulk
storage facility only if satisfactory evidence is given that
it is actually used in the manner indicated. In the absence
of such actual use evidence, the AGRAPORT would be classifi-
able in item 653.00, TSUS. Copies of our actual use
regulations are enclosed for your reference.
The Harmonized Tariff Schedule of the United States
Annotated (HTSUSA), is scheduled to replace the TSUS as the
tariff code of the United States. The HTSUSA provision for
the AGRAPORT bulk storage facility is 7308.90.90, Structures
and parts of structures of iron or steel, other. The HTSUSA
equivalent of item 870.40, TSUS, is 9817.00.50, Machinery,
equipment and implements to be used for agricultural or
horticultural purposes. The same actual use requirements
apply. However, certain administrative errors in the current
HTSUSA make Subheading 9817.00.50 inapplicable to the
AGRAPORT. Customs has brought these errors to the attention
of the responsible agency and we expect them to be corrected
before the next HTSUSA supplement is issued in the Fall.
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This represents the present position of the Customs
Service on the classification of this merchandise. However,
if there are changes in these provisions prior to enactment of
the HTSUSA, this advice may not continue to apply.
Sincerely,
John Durant, Director,
Commercial Rulings Division
Enclosure