USDA's $8.1M contract for frozen turkey products awarded to Jennie-O Turkey Store Inc

Contract Overview

Contract Amount: $8,146,983 ($8.1M)

Contractor: Jennie-O Turkey Store Inc

Awarding Agency: Department of Agriculture

Start Date: 2022-11-16

End Date: 2023-06-30

Contract Duration: 226 days

Daily Burn Rate: $36.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000008874/4100026487/TURKEY BREAST SMKD SLC FRZ PKG-8/5 LB,TURKEY BREAST SMKD DELI FRZ CTN-40 LB,TURKEY ROASTS FRZ CTN-32-48 LB,TURKEY BREAST DELI SLICED FRZ PKG-8/5 LB

Place of Performance

Location: WILLMAR, KANDIYOHI County, MINNESOTA, 56201

State: Minnesota Government Spending

Plain-Language Summary

Department of Agriculture obligated $8.1 million to JENNIE-O TURKEY STORE INC for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000008874/4100026487/TURKEY BREAST SMKD SLC FRZ PKG-8/5 LB,TURKEY BREAST SMKD DELI FRZ CTN-40 LB,TURKEY ROASTS FRZ CTN-32-48 LB,TURKEY BREAST DELI SLICED FRZ PKG-8/5 LB Key points: 1. The contract focuses on frozen turkey products, including breast and roasts, for food donations. 2. Jennie-O Turkey Store Inc. is the sole awardee under a full and open competition. 3. The contract value is $8,146,982.67, with a duration of 226 days. 4. The procurement falls under the Agricultural Marketing Service within the Department of Agriculture. 5. The fixed-price contract aims to procure essential commodities for federal food assistance programs.

Value Assessment

Rating: good

The contract price of $8,146,982.67 for 200,000+ lbs of turkey products appears reasonable given market rates for bulk frozen poultry. Benchmarking against similar government food procurements would provide a more precise assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, suggesting multiple vendors had the opportunity to bid. This method generally promotes competitive pricing and ensures the government receives fair market value.

Taxpayer Impact: Taxpayer funds are utilized to procure essential food commodities for donation programs, supporting food security initiatives.

Public Impact

Ensures availability of nutritious food for federal donation programs, aiding vulnerable populations. Supports the agricultural sector by providing a consistent demand for turkey products. The contract contributes to the Department of Agriculture's mission of supporting American farmers and ensuring food access.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price fluctuations in commodity markets impacting future procurements.
Logistical challenges in distribution of frozen goods across various donation sites.

Positive Signals

Clear product specifications ensure quality and suitability for donation.
Fixed-price contract provides cost certainty for the government.
Award to a known supplier in the poultry industry suggests reliability.

Sector Analysis

This contract falls within the Food and Agriculture sector, specifically the procurement of processed poultry products. Government spending in this area is crucial for supporting domestic agriculture and fulfilling food assistance mandates.

Small Business Impact

While this specific contract was awarded to Jennie-O Turkey Store Inc., a large entity, the Department of Agriculture frequently engages small businesses for various agricultural commodities and services. Future solicitations should be reviewed for small business set-aside opportunities.

Oversight & Accountability

The Department of Agriculture's Agricultural Marketing Service is responsible for overseeing this contract. Standard procurement regulations and oversight mechanisms are expected to be in place to ensure compliance and accountability.

Related Government Programs

Poultry Processing
Department of Agriculture Contracting
Agricultural Marketing Service Programs

Risk Flags

Dependence on a single supplier for a large volume of a critical commodity.
Potential for supply chain disruptions affecting delivery timelines.
Market volatility in poultry prices could impact cost-effectiveness over time.
Ensuring consistent quality across all delivered product batches.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $8.1 million to JENNIE-O TURKEY STORE INC. COMMODITIES FOR USG FOOD DONATIONS: 2000008874/4100026487/TURKEY BREAST SMKD SLC FRZ PKG-8/5 LB,TURKEY BREAST SMKD DELI FRZ CTN-40 LB,TURKEY ROASTS FRZ CTN-32-48 LB,TURKEY BREAST DELI SLICED FRZ PKG-8/5 LB

Who is the contractor on this award?

The obligated recipient is JENNIE-O TURKEY STORE INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $8.1 million.

What is the period of performance?

Start: 2022-11-16. End: 2023-06-30.

What is the historical pricing trend for similar frozen turkey products procured by the government?

Analyzing historical pricing data for comparable frozen turkey products procured by the government would reveal trends and potential cost savings. This involves comparing unit prices, contract volumes, and award dates to identify any significant deviations or patterns. Understanding these trends helps in assessing the current contract's value and informs future negotiation strategies.

What are the potential risks associated with the long-term storage and transportation of frozen turkey products?

Risks include maintaining the cold chain integrity to prevent spoilage, potential for power outages affecting storage facilities, and increased transportation costs due to fuel prices and specialized refrigerated logistics. Ensuring proper handling, storage protocols, and reliable transportation partners are critical to mitigate these risks and maintain product quality.

How effectively does this contract support the broader goals of federal food donation programs?

This contract effectively supports federal food donation programs by ensuring a consistent supply of a key protein source. The procurement of frozen turkey products directly addresses nutritional needs within these programs. The scale of the contract suggests a significant contribution to food banks and other distribution channels, thereby enhancing food security for recipients.

Industry Classification

NAICS: Manufacturing › Animal Slaughtering and Processing › Poultry Processing

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: 123J1423B0034

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Hormel Foods Corporation

Address: 2505 WILLMAR AVE SW, WILLMAR, MN, 56201

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

Financial Breakdown

Contract Ceiling: $8,146,983

Exercised Options: $8,146,983

Current Obligation: $8,146,983

Actual Outlays: $8,141,860

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline