USDA Awards $34.9M Contract to Jennie-O for Frozen Turkey Breast for Food Donations

Contract Overview

Contract Amount: $34,886,150 ($34.9M)

Contractor: Jennie-O Turkey Store Inc

Awarding Agency: Department of Agriculture

Start Date: 2024-08-26

End Date: 2025-05-15

Contract Duration: 262 days

Daily Burn Rate: $133.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000010260/4100030842/TURKEY BREAST CKD FRZ CTN 34-42 LBS,TURKEY BREAST DELI SLC FRZ PKG-20/2 LB

Place of Performance

Location: WILLMAR, KANDIYOHI County, MINNESOTA, 56201

State: Minnesota Government Spending

Plain-Language Summary

Department of Agriculture obligated $34.9 million to JENNIE-O TURKEY STORE INC for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000010260/4100030842/TURKEY BREAST CKD FRZ CTN 34-42 LBS,TURKEY BREAST DELI SLC FRZ PKG-20/2 LB Key points: 1. Significant award for essential food commodities supporting federal donation programs. 2. Jennie-O Turkey Store Inc. is the sole awardee, indicating a specific supplier relationship. 3. The contract value is substantial, requiring careful monitoring of delivery and quality. 4. Focus on frozen, processed turkey breast suggests specific nutritional and logistical requirements.

Value Assessment

Rating: good

The contract value of $34.9M for frozen turkey breast appears reasonable given the quantity and nature of the commodity. Benchmarking against similar large-scale food procurement contracts would provide further validation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process. This method is expected to yield fair market prices for the commodities procured.

Taxpayer Impact: This contract supports vital federal food donation programs, ensuring efficient distribution of food resources to those in need.

Public Impact

Ensures availability of nutritious food for federal donation programs. Supports agricultural sector by procuring processed poultry products. Contributes to food security initiatives across the nation. Provides a stable demand for turkey products from a specific region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price fluctuations in commodity markets impacting long-term value.
Dependence on a single supplier for a critical food item.
Logistical challenges in distributing frozen goods nationwide.

Positive Signals

Supports a key government program with tangible benefits.
Awarded through a competitive process, suggesting price efficiency.
Clear contract duration and delivery schedule.

Sector Analysis

This contract falls within the broader agricultural and food processing sector. Spending benchmarks for similar commodity procurements by the USDA's Agricultural Marketing Service can be used for comparison.

Small Business Impact

The data indicates this contract was not awarded to small businesses, as Jennie-O Turkey Store Inc. is a large corporation. Future procurements should explore opportunities for small business participation.

Oversight & Accountability

The contract is managed by the Department of Agriculture's Agricultural Marketing Service, which is responsible for ensuring quality and timely delivery. Oversight will be crucial to confirm adherence to specifications and program goals.

Related Government Programs

Poultry Processing
Department of Agriculture Contracting
Agricultural Marketing Service Programs

Risk Flags

Single supplier for critical commodity.
Potential for commodity price volatility.
Logistical complexity of frozen food distribution.
Lack of small business participation in this specific award.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $34.9 million to JENNIE-O TURKEY STORE INC. COMMODITIES FOR USG FOOD DONATIONS: 2000010260/4100030842/TURKEY BREAST CKD FRZ CTN 34-42 LBS,TURKEY BREAST DELI SLC FRZ PKG-20/2 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 $34.9 million.

What is the period of performance?

Start: 2024-08-26. End: 2025-05-15.

What is the unit cost of the turkey breast and how does it compare to market rates for similar frozen products?

The total contract value is $34,886,149.66 for an unspecified total quantity of turkey breast. To determine the unit cost, the total pounds procured would need to be known. A comparison to market rates would require this quantity and current commodity pricing data for frozen turkey breast, factoring in packaging and delivery.

What are the risks associated with relying on a single supplier for such a large quantity of a perishable food item?

Reliance on a single supplier like Jennie-O Turkey Store Inc. poses risks such as supply chain disruptions due to unforeseen events (e.g., disease outbreaks, natural disasters, labor issues) affecting the supplier's production. This could lead to delays or shortages in food donations. Additionally, it limits the government's leverage in price negotiations over the contract's life.

How effectively will this contract meet the nutritional and logistical needs of the federal food donation programs?

The contract specifies 'TURKEY BREAST CKD FRZ CTN 34-42 LBS, TURKEY BREAST DELI SLC FRZ PKG-20/2 LB,' indicating specific product forms suitable for donation. The frozen nature allows for longer shelf life and wider distribution. Effectiveness will depend on the recipient agencies' capacity to store and distribute frozen goods and the quality of the delivered product.

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: 123J1424B0553

Offers Received: 6

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, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $34,886,150

Exercised Options: $34,886,150

Current Obligation: $34,886,150

Actual Outlays: $33,482,938

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline