USDA's $33.4M nut and peanut butter contract awarded to Stutz Packing Company for roasted nuts and peanut butter manufacturing

Contract Overview

Contract Amount: $33,445,876 ($33.4M)

Contractor: Stutz Packing Company

Awarding Agency: Department of Agriculture

Start Date: 2019-02-28

End Date: 2019-07-08

Contract Duration: 130 days

Daily Burn Rate: $257.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 12

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: 2000005850/4100016860/WALNUT ENG PCS CTN-24/1 LB,PECAN PIECES PKG-24/1 LB,PISTACHIO ROASTED IN SHELL PKG-12/2 LB

Place of Performance

Location: INDIO, RIVERSIDE County, CALIFORNIA, 92201

State: California Government Spending

Plain-Language Summary

Department of Agriculture obligated $33.4 million to STUTZ PACKING COMPANY for work described as: 2000005850/4100016860/WALNUT ENG PCS CTN-24/1 LB,PECAN PIECES PKG-24/1 LB,PISTACHIO ROASTED IN SHELL PKG-12/2 LB Key points: 1. The contract value of $33.4 million represents a significant investment in agricultural commodities. 2. Awarded under full and open competition, indicating a robust bidding process. 3. The contract duration of 130 days suggests a focused, short-term procurement need. 4. The fixed-price contract type aims to control costs and provide budget certainty. 5. The geographic scope is limited to California, potentially impacting regional suppliers. 6. The absence of small business set-aside flags may warrant further investigation into subcontracting opportunities.

Value Assessment

Rating: good

The contract value of $33.4 million for roasted nuts and peanut butter manufacturing appears reasonable given the quantity and type of goods procured. Benchmarking against similar agricultural commodity contracts would provide a more precise value-for-money assessment. The firm fixed-price structure suggests that the government has a clear understanding of the costs involved, which can lead to better price predictability.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, with 12 bids received. This high level of competition is generally positive, suggesting that multiple vendors were interested and capable of fulfilling the requirement. A competitive bidding process typically leads to better price discovery and potentially lower costs for the government.

Taxpayer Impact: The extensive competition for this contract is beneficial for taxpayers as it likely drove down the final price, ensuring that federal funds were used efficiently for the procurement of agricultural products.

Public Impact

The primary beneficiaries are the agricultural producers and processors within the nut and peanut butter industry. The contract delivers essential food commodities, likely for domestic consumption or federal feeding programs. The geographic impact is concentrated in California, supporting the state's agricultural economy. Workforce implications may include employment in processing, packaging, and logistics within the agricultural sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential lack of specific small business subcontracting goals may limit opportunities for smaller enterprises.
The short contract duration could create challenges for businesses needing longer-term planning or investment.

Positive Signals

Full and open competition indicates a healthy market with multiple capable suppliers.
The firm fixed-price contract type provides cost certainty for the government.
The contract supports the agricultural sector, aligning with potential USDA mission objectives.

Sector Analysis

The procurement falls within the broader food manufacturing and agricultural products sector. This sector is characterized by commodity-based pricing, supply chain complexities, and varying degrees of market concentration. The contract for roasted nuts and peanut butter is a specific niche within this larger industry, likely influenced by factors such as crop yields, seasonal availability, and global market dynamics. Comparable spending benchmarks would involve analyzing other large-scale procurements of similar food items by government agencies.

Small Business Impact

The contract was not set aside for small businesses, and the data indicates no specific small business subcontracting requirements were mandated. While 12 bids were received, the absence of a set-aside or explicit subcontracting plan means that opportunities for small businesses to participate directly or indirectly may be limited. This could potentially concentrate the benefits of the contract with larger entities within the sector.

Oversight & Accountability

Oversight for this contract would typically fall under the Agricultural Marketing Service (AMS) within the Department of Agriculture. Accountability measures are inherent in the firm fixed-price contract, requiring the contractor to deliver specified goods at the agreed-upon price. Transparency is generally maintained through contract award databases, though specific performance metrics and oversight activities may not be publicly detailed.

Related Government Programs

USDA School Lunch Program
Department of Defense Food Procurement
Commodity Supplemental Food Program
National School Breakfast Program

Risk Flags

Potential for commodity price volatility impacting fixed-price contract
Supply chain risks related to agricultural production
Quality control during processing and packaging

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $33.4 million to STUTZ PACKING COMPANY. 2000005850/4100016860/WALNUT ENG PCS CTN-24/1 LB,PECAN PIECES PKG-24/1 LB,PISTACHIO ROASTED IN SHELL PKG-12/2 LB

Who is the contractor on this award?

The obligated recipient is STUTZ PACKING COMPANY.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $33.4 million.

What is the period of performance?

Start: 2019-02-28. End: 2019-07-08.

What is the historical spending pattern for roasted nuts and peanut butter by the Department of Agriculture?

Analyzing historical spending for roasted nuts and peanut butter by the USDA requires accessing procurement data over several fiscal years. While this specific contract was awarded in 2019 for approximately $33.4 million, understanding the broader trend involves looking at prior awards for similar items. Factors such as changes in commodity prices, shifts in program requirements (e.g., school meal programs, disaster relief), and the number of competing vendors can influence annual spending. A review of past solicitations and awards would reveal if this contract represents a typical procurement size or an outlier, and whether spending has been consistent or fluctuating. It's also important to note if different agencies within the USDA or other federal entities procure these items, contributing to the overall federal expenditure.

How does the price per unit for the nuts and peanut butter in this contract compare to market rates at the time of award?

To assess the price per unit, we would need the exact quantities of each item (WALNUT ENG PCS CTN-24/1 LB, PECAN PIECES PKG-24/1 LB, PISTACHIO ROASTED IN SHELL PKG-12/2 LB) and the total contract value. Assuming the $33.4 million covers these items, a detailed breakdown of quantities is necessary for a precise calculation. Once quantities are known, a per-pound or per-unit cost can be derived and compared to prevailing market prices for similar quality and packaging at the time of the February 2019 award. Market data from agricultural reports, industry publications, or commodity exchanges would serve as benchmarks. Significant deviations from market rates, even in a competitive bid, could indicate issues with the bid evaluation or the specific requirements of the solicitation.

What was the track record of Stutz Packing Company with federal contracts prior to this award?

Investigating Stutz Packing Company's track record involves reviewing their past federal contract awards, including performance history, any disputes, and compliance records. Accessing the Federal Procurement Data System (FPDS) or similar databases would reveal previous contracts awarded to Stutz Packing Company by various federal agencies. Key aspects to examine include the types of goods or services previously provided, the contract values, the duration of those contracts, and whether they were completed successfully and on time. Information on any contract terminations, penalties, or negative past performance reviews would be critical in assessing their reliability as a federal contractor. A history of successful contract performance generally indicates a lower risk for future awards.

What specific federal programs or initiatives does this procurement of roasted nuts and peanut butter support?

This procurement of roasted nuts and peanut butter by the Department of Agriculture's Agricultural Marketing Service likely supports several key federal programs focused on nutrition and food security. Prominent among these are the National School Lunch Program (NSLP) and the School Breakfast Program (SBP), which provide funding for food purchases for schools. Additionally, these commodities could be destined for the Commodity Supplemental Food Program (CSFP), which serves low-income pregnant, breastfeeding, and postpartum women, and infants and children up to age six, as well as the Emergency Food Assistance Program (TEFAP). The specific end-use would depend on the detailed requirements outlined in the contract solicitation and subsequent distribution plans by the USDA.

Were there any identified risks or challenges associated with this specific contract award or the contractor?

Assessing risks for this contract involves considering factors inherent in commodity procurement and the specific details of the award. Potential risks could include fluctuations in raw material costs (nuts, peanuts) impacting the contractor's ability to maintain profitability under a fixed price, supply chain disruptions (weather, pests affecting crops), or quality control issues during processing and packaging. Given the award to Stutz Packing Company, a review of their operational capacity, financial stability, and past performance on similar contracts would be necessary to identify contractor-specific risks. The short duration (130 days) might also pose logistical challenges for timely delivery. Publicly available data on contract performance, such as inspection reports or delivery timeliness, would provide further insight into any realized risks.

Industry Classification

NAICS: Manufacturing › Other Food Manufacturing › Roasted Nuts and Peanut Butter Manufacturing

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: 123J1419B0159/4100016860

Offers Received: 12

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 82689 AVENUE 45, INDIO, CA, 92201

Business Categories: Category Business, Corporate Entity Not Tax Exempt, HUBZone Firm, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $33,445,876

Exercised Options: $33,445,876

Current Obligation: $33,445,876

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline