USDA awards $18.7M for chicken to Tyson Foods under full and open competition

Contract Overview

Contract Amount: $18,742,776 ($18.7M)

Contractor: Tyson Foods Inc.

Awarding Agency: Department of Agriculture

Start Date: 2025-06-27

End Date: 2025-09-30

Contract Duration: 95 days

Daily Burn Rate: $197.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 10

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000010837/4100032478/CHICKEN LARGE CHILLED -BULK,CHICKEN WHOLE BAGGED FRZ CTN-36-43 LB

Place of Performance

Location: NEW HOLLAND, LANCASTER County, PENNSYLVANIA, 17557

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Agriculture obligated $18.7 million to TYSON FOODS INC. for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000010837/4100032478/CHICKEN LARGE CHILLED -BULK,CHICKEN WHOLE BAGGED FRZ CTN-36-43 LB Key points: 1. Tyson Foods secured a significant contract for bulk chilled and frozen chicken. 2. The contract was awarded through full and open competition, indicating a competitive bidding process. 3. The firm fixed price contract type suggests price certainty for the government. 4. This award falls within the broader context of government food procurement and agricultural support.

Value Assessment

Rating: good

The awarded amount of $18.7M for chicken appears reasonable given the quantity and duration. Benchmarking against similar large-scale food commodity contracts would provide further validation.

Cost Per Unit: $0.94 per pound (estimated based on total award and estimated weight)

Competition Analysis

Competition Level: full-and-open

The contract was awarded using full and open competition, suggesting multiple bidders likely participated. This method generally promotes competitive pricing and ensures the government receives fair market value.

Taxpayer Impact: The competitive award process is expected to yield cost savings for taxpayers by securing chicken at a favorable price point for federal food donation programs.

Public Impact

Ensures supply of essential protein for federal food donation programs. Supports domestic agriculture and food processing industries. Contributes to food security initiatives by providing resources to those in need.

Waste & Efficiency Indicators

Waste Risk Score: 75 / 10

Positive Signals

Competitive award process
Clear contract type (FFP)
Defined delivery period

Sector Analysis

This contract falls under the 'Commodities' sector within the broader 'Agriculture' industry. Government spending on food commodities for donation programs is substantial, aiming to support food banks and other relief organizations.

Small Business Impact

While Tyson Foods is a large corporation, the contract's full and open competition nature could have allowed for participation or subcontracting opportunities for smaller businesses within the supply chain, though this is not explicitly stated.

Oversight & Accountability

The Department of Agriculture's Agricultural Marketing Service is responsible for this procurement. Standard oversight mechanisms for contract performance and delivery would apply to ensure compliance with terms.

Related Government Programs

Poultry Processing
Department of Agriculture Contracting
Agricultural Marketing Service Programs

Risk Flags

Potential over-reliance on a single large supplier.
Market volatility in commodity prices could impact long-term value.
Logistical challenges in distribution to diverse donation points.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $18.7 million to TYSON FOODS INC.. COMMODITIES FOR USG FOOD DONATIONS: 2000010837/4100032478/CHICKEN LARGE CHILLED -BULK,CHICKEN WHOLE BAGGED FRZ CTN-36-43 LB

Who is the contractor on this award?

The obligated recipient is TYSON 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 $18.7 million.

What is the period of performance?

Start: 2025-06-27. End: 2025-09-30.

What is the historical pricing trend for similar bulk chicken purchases by the government?

Analyzing historical pricing data for comparable bulk chicken purchases by federal agencies is crucial for a comprehensive value assessment. This would involve comparing the current per-pound cost against past awards, considering factors like inflation, market fluctuations, and contract specifics. Without this historical context, it's challenging to definitively state if this $18.7M award represents an optimal price point over time.

Are there any potential supply chain risks associated with relying on a single large supplier for this commodity?

While Tyson Foods is a major supplier, concentrating a large portion of federal food donation chicken procurement with one entity could introduce supply chain risks. Disruptions due to unforeseen events like disease outbreaks, labor issues, or transportation problems could impact delivery. Diversifying suppliers or having contingency plans could mitigate these risks, though full and open competition aims to select the most capable bidder.

How effectively does this procurement align with the stated goals of the federal food donation program?

This procurement directly aligns with the stated goals of federal food donation programs by securing a substantial quantity of a key protein source. The competitive award process suggests an effort to maximize the value of taxpayer funds allocated to these programs. Ensuring timely delivery and quality of the chicken will be critical to the program's overall effectiveness in addressing food insecurity.

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: 123J1425B0381

Offers Received: 10

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2200, WEST DON TYSON PARKWAY, SPRINGDALE, AR, 72762

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: $18,742,776

Exercised Options: $18,742,776

Current Obligation: $18,742,776

Actual Outlays: $18,742,714

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline