Department of Agriculture awards $29.5M contract for pork cans, highlighting food procurement needs

Contract Overview

Contract Amount: $29,531,283 ($29.5M)

Contractor: Lakeside Foods Inc

Awarding Agency: Department of Agriculture

Start Date: 2018-11-29

End Date: 2019-04-28

Contract Duration: 150 days

Daily Burn Rate: $196.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: 2000005699/4100016336/PORK CAN-24/24 OZ

Place of Performance

Location: PLAINVIEW, WABASHA County, MINNESOTA, 55964

State: Minnesota Government Spending

Plain-Language Summary

Department of Agriculture obligated $29.5 million to LAKESIDE FOODS INC for work described as: 2000005699/4100016336/PORK CAN-24/24 OZ Key points: 1. Contract value represents a significant investment in food supplies for federal programs. 2. Procurement focused on a specific food item, indicating targeted needs within the agency. 3. The contract duration of 150 days suggests a short-term or immediate supply requirement. 4. Fixed-price contract type offers cost certainty for the government. 5. The award to a single vendor may warrant further examination of market availability and competition. 6. Geographic location of the vendor (Minnesota) could influence distribution logistics and regional economic impact.

Value Assessment

Rating: fair

The contract value of $29.5 million for 2,000,005,699 units of 24 oz pork cans appears substantial. Benchmarking this against similar food procurement contracts is challenging without more granular data on unit prices and specific product requirements. The "per-unit cost" of approximately $0.015 per can (based on total value and quantity) seems low, but this is likely due to the sheer volume and the nature of bulk food commodity pricing. Further analysis would require comparing the price per pound or per ounce for the pork content itself.

Cost Per Unit: Approximately $0.015 per 24 oz can (based on total value and quantity), which is likely a bulk commodity rate and not directly comparable to retail pricing.

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This suggests a healthy competitive environment for this type of food procurement. The fact that it resulted in a single award implies that Lakeside Foods Inc. was the most advantageous offer based on the evaluation criteria, which could include price, quality, and delivery terms.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through market forces, ensuring the government receives the best possible value for its expenditure on essential food supplies.

Public Impact

Beneficiaries include recipients of federal food assistance programs or government institutions supplied with these pork products. Services delivered involve the provision of canned pork, a shelf-stable protein source. Geographic impact is primarily centered around the distribution network for these food supplies, potentially serving various federal facilities or program sites. Workforce implications may include employment at Lakeside Foods Inc. and its supply chain partners involved in production and distribution.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price fluctuations in raw material costs (pork) impacting future contract values.
Dependence on a single vendor for a large quantity of a specific food item could pose supply chain risks if not managed proactively.

Positive Signals

Awarded through full and open competition, suggesting a competitive bidding process.
Firm fixed-price contract provides budget certainty for the procuring agency.
The large quantity awarded indicates a significant demand and potential for economies of scale.

Sector Analysis

This contract falls within the broader food manufacturing and agricultural products sector. The market for government food procurement is substantial, with agencies like the Department of Agriculture regularly sourcing large quantities of various food items for domestic and international programs. Competition in this space can vary depending on the specificity of the product, but generally involves established food producers and distributors.

Small Business Impact

The contract was awarded to Lakeside Foods Inc., a large business. There is no indication of a small business set-aside for this specific procurement. Subcontracting opportunities for small businesses would depend on Lakeside Foods Inc.'s internal policies and supply chain needs, which are not detailed in the provided data.

Oversight & Accountability

The contract is subject to standard federal procurement oversight mechanisms. The Department of Agriculture's Agricultural Marketing Service is responsible for managing and overseeing this contract. Transparency is generally maintained through contract award databases like FPDS. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse related to the contract.

Related Government Programs

National School Lunch Program
Food Distribution Program on Indian Reservations
Commodity Supplemental Food Program
Defense Logistics Agency (Food Services)

Risk Flags

Potential supply chain vulnerability due to single-source award for a large quantity.
Price benchmarking requires more granular data on product specifications and market rates.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $29.5 million to LAKESIDE FOODS INC. 2000005699/4100016336/PORK CAN-24/24 OZ

Who is the contractor on this award?

The obligated recipient is LAKESIDE FOODS INC.

Which agency awarded this contract?

Awarding agency: Department of Agriculture (Agricultural Marketing Service).

What is the total obligated amount?

The obligated amount is $29.5 million.

What is the period of performance?

Start: 2018-11-29. End: 2019-04-28.

What is the historical spending pattern for canned pork by the Department of Agriculture?

Analyzing historical spending on canned pork by the Department of Agriculture requires access to comprehensive procurement data over multiple fiscal years. Without this specific data, it's difficult to establish a precise trend. However, the Department of Agriculture frequently procures large quantities of food commodities, including canned goods, to support various domestic food assistance programs and international aid efforts. The size of this $29.5 million award suggests a significant, potentially recurring, need for this specific item. Factors influencing historical spending would include changes in program requirements, food availability, commodity prices, and overall budget allocations for food procurement.

How does the unit price of this canned pork compare to market rates for similar products?

The provided data indicates a total award of $29,531,282.83 for 2,000,005,699 units of 24 oz pork cans. This results in a calculated price of approximately $0.015 per can. It is crucial to understand that this is a bulk commodity price for a specific government contract and not directly comparable to retail prices for canned pork. Retail prices reflect different packaging, smaller quantities, branding, and distribution markups. To accurately benchmark, one would need to compare the price per pound or per ounce of the actual pork content against wholesale or institutional food supplier pricing for similar specifications, considering factors like fat content, cut, and processing.

What are the specific quality and nutritional standards required for this canned pork?

The provided data does not specify the exact quality and nutritional standards for the canned pork. However, government food procurement contracts, especially those managed by the Department of Agriculture, typically adhere to stringent specifications. These often include requirements related to the type and cut of pork, fat content, sodium levels, processing methods (e.g., sterilization), packaging integrity, and shelf life. Nutritional information would also be a key component, ensuring the product meets dietary guidelines for the intended beneficiaries of federal food programs. Detailed specifications would be outlined in the solicitation documents for this contract.

What is the track record of Lakeside Foods Inc. in fulfilling large-scale government food contracts?

Lakeside Foods Inc. has a history of supplying food products to government entities. While the provided data focuses on this specific contract, a comprehensive assessment of their track record would involve reviewing their performance on past federal contracts, including timeliness of delivery, product quality compliance, and responsiveness to any issues. Information on past performance is often available through government contract databases and performance evaluation systems, which can provide insights into their reliability and capacity to handle large-volume procurements like this one.

What are the potential risks associated with the large quantity and single vendor award for this contract?

The primary risks associated with awarding a large quantity of canned pork to a single vendor include potential supply chain disruptions if the vendor faces production issues, natural disasters, or other unforeseen events. There's also a risk of price escalation in future procurements if market conditions change and competition is limited. Furthermore, a single vendor might have less incentive to innovate or offer premium quality if they perceive a captive market. However, the 'full and open competition' aspect suggests that this vendor was deemed the best value at the time of award, mitigating some of these risks.

How does this contract contribute to the Department of Agriculture's mission and specific programs?

This contract directly supports the Department of Agriculture's mission to enhance food security and provide access to nutritious food. The canned pork procured is likely intended for distribution through various federal food assistance programs, such as the National School Lunch Program, food banks, or disaster relief efforts. By securing a large supply of a shelf-stable protein source, the USDA ensures that essential nutritional needs can be met for vulnerable populations, contributing to public health and well-being. The scale of the award indicates a significant programmatic requirement.

Industry Classification

NAICS: Manufacturing › Animal Slaughtering and Processing › Animal (except Poultry) Slaughtering

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: 123J1419B0042/4100016336

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lakeside Foods, Inc.

Address: 808 HAMILTON ST, MANITOWOC, WI, 54220

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $29,531,283

Exercised Options: $29,531,283

Current Obligation: $29,531,283

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline