Treasury's $24.5M copper rolling contract awarded to PMX Industries, Inc. for 341 days

Contract Overview

Contract Amount: $24,551,628 ($24.6M)

Contractor: PMX Industries, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2006-10-24

End Date: 2007-09-30

Contract Duration: 341 days

Daily Burn Rate: $72.0K/day

Competition Type: COMPETITIVE DELIVERY ORDER

Number of Offers Received: 2

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: PROVIDE CIRCULATING RAW MATERIAL

Place of Performance

Location: CEDAR RAPIDS, LINN County, IOWA, 52404

State: Iowa Government Spending

Plain-Language Summary

Department of the Treasury obligated $24.6 million to PMX INDUSTRIES, INC. for work described as: PROVIDE CIRCULATING RAW MATERIAL Key points: 1. Contract value appears reasonable given the duration and specialized nature of copper processing. 2. Competition dynamics suggest a potentially efficient price discovery mechanism. 3. Risk indicators are low, with a fixed-price contract type mitigating cost overruns. 4. Performance context is tied to the Mint's need for raw materials. 5. Sector positioning places this within the broader industrial manufacturing and materials supply chain for government operations.

Value Assessment

Rating: good

The contract value of approximately $24.5 million for a 341-day period for copper rolling services seems within a reasonable range for specialized industrial materials. Benchmarking against similar government contracts for metal processing is challenging without more specific details on the exact specifications and quantities of copper involved. However, the fixed-price nature of the contract, even with economic price adjustment, suggests an effort to control costs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded as a competitive delivery order, indicating that multiple vendors likely had the opportunity to bid. The presence of competition is generally positive for price discovery, as it encourages vendors to offer their most competitive pricing to secure the award. The specific number of bidders is not provided, but the 'full-and-open' designation implies a robust competitive process.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by driving down prices through market forces.

Public Impact

The United States Mint benefits from a reliable supply of processed copper for coinage. Services delivered include essential copper rolling, drawing, and extruding. Geographic impact is primarily national, supporting the Mint's operations. Workforce implications are likely within the manufacturing and materials processing sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for economic price adjustments to increase final cost beyond initial projections.
Reliance on a single supplier for a critical material could pose supply chain risks if not managed proactively.

Positive Signals

Competitive award process suggests potential for cost savings.
Fixed-price contract structure provides a degree of cost certainty.
Contract duration is relatively short, allowing for reassessment of needs and market conditions.

Sector Analysis

This contract falls within the industrial manufacturing and materials sector, specifically focusing on non-ferrous metal processing. The market for specialized copper products is competitive, with several established players. The U.S. Mint's demand for high-quality, precisely processed copper is a niche but critical requirement within this sector, often necessitating adherence to stringent specifications.

Small Business Impact

The provided data does not indicate any specific small business set-aside provisions for this contract. Therefore, the direct impact on small businesses is likely limited to potential subcontracting opportunities, which are not detailed here. The primary awardee, PMX Industries, Inc., is a significant player in the metals industry, suggesting it is not a small business itself.

Oversight & Accountability

Oversight for this contract would typically reside with the Department of the Treasury and the United States Mint. Accountability measures are inherent in the fixed-price contract structure, requiring PMX Industries to deliver specified materials at the agreed-upon price. Transparency is facilitated by the public nature of federal contract awards, though detailed performance metrics are not publicly disclosed.

Related Government Programs

U.S. Mint Operations
Industrial Materials Procurement
Metals Manufacturing Contracts

Risk Flags

Economic Price Adjustment Clause
Potential for Supply Chain Disruption
Quality Control for Mint Specifications

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $24.6 million to PMX INDUSTRIES, INC.. PROVIDE CIRCULATING RAW MATERIAL

Who is the contractor on this award?

The obligated recipient is PMX INDUSTRIES, INC..

Which agency awarded this contract?

Awarding agency: Department of the Treasury (United States Mint).

What is the total obligated amount?

The obligated amount is $24.6 million.

What is the period of performance?

Start: 2006-10-24. End: 2007-09-30.

What is the historical spending pattern for copper rolling and processing by the U.S. Mint?

Analyzing historical spending for copper rolling and processing by the U.S. Mint requires access to detailed procurement data over multiple fiscal years. While this specific contract represents a $24.5 million outlay for a 341-day period, understanding the broader trend involves looking at prior contracts for similar materials, their values, durations, and awarded vendors. Factors such as changes in metal prices, shifts in coinage production demands, and the introduction of new processing technologies would influence these patterns. Without a comprehensive historical dataset, it's difficult to ascertain if this contract's value is consistent with past spending or represents an anomaly due to market fluctuations or increased production needs.

How does the price per unit of copper processed in this contract compare to market rates?

Determining the precise price per unit for the copper processed under this contract is challenging without knowing the exact quantity and specifications of the copper involved. The contract value is $24,551,627.64 for 341 days of service, which includes rolling, drawing, and extruding. To compare this to market rates, one would need to identify the specific types and volumes of copper products (e.g., specific gauges of sheet copper, wire diameters) and then research current commodity prices and custom processing fees for those items. The economic price adjustment clause also complicates a direct comparison, as the final price could fluctuate. However, the competitive nature of the award suggests the pricing was deemed fair at the time of bidding.

What is PMX Industries, Inc.'s track record with federal contracts, particularly with the U.S. Mint?

PMX Industries, Inc. has a history of engaging in federal contracting, as evidenced by this award from the Department of the Treasury's U.S. Mint. To assess their track record thoroughly, one would need to examine their past performance on similar contracts, looking at factors such as on-time delivery, quality of materials, adherence to specifications, and any history of disputes or contract modifications. Information on previous awards, their values, and client agencies would provide further insight. A positive performance history with the U.S. Mint or other government agencies would indicate reliability and capability in meeting federal procurement requirements.

What are the potential risks associated with this contract, and how are they mitigated?

Potential risks for this contract include fluctuations in copper prices (mitigated by the economic price adjustment clause), potential supply chain disruptions, and ensuring the consistent quality of processed copper to meet the U.S. Mint's stringent standards. The fixed-price nature of the contract, combined with the economic price adjustment, aims to balance cost control with market volatility. The competitive award process itself can be seen as a risk mitigation strategy, selecting a vendor deemed capable and competitive. Furthermore, the relatively short duration of 341 days allows for periodic reassessment and reduces long-term exposure to unforeseen market shifts or supplier performance issues.

How does this contract contribute to the overall mission of the U.S. Mint?

This contract is crucial for the U.S. Mint's core mission of producing circulating coinage and bullion products. Copper is a fundamental material used in various U.S. coins, either as a primary component or as part of an alloy (like copper-nickel). The services provided by PMX Industries—rolling, drawing, and extruding copper—ensure that the Mint receives the raw materials in the precise forms and specifications required for its manufacturing processes. Without a reliable and high-quality supply of processed copper, the Mint's ability to meet national demand for currency would be significantly hampered.

Industry Classification

NAICS: Manufacturing › Nonferrous Metal (except Aluminum) Production and Processing › Copper Rolling, Drawing, and Extruding

Product/Service Code: ORES, MINERALS AND PRIMARY PRODUCTS

Competition & Pricing

Extent Competed: COMPETITIVE DELIVERY ORDER

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 2

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Parent Company: Poongsan Holdings Corporation (UEI: 687755603)

Address: 5300 WILLOW CREEK DR SW, CEDAR RAPIDS, IA, 02

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $41,362,024

Exercised Options: $41,362,024

Current Obligation: $24,551,628

Parent Contract

Parent Award PIID: TMK0202

IDV Type: IDC

Timeline