USDA awards $4.4M for cheese blend for food donations, ensuring supply for 60 months

Contract Overview

Contract Amount: $4,402,742 ($4.4M)

Contractor: Bongards Creameries

Awarding Agency: Department of Agriculture

Start Date: 2025-12-04

End Date: 2026-02-02

Contract Duration: 60 days

Daily Burn Rate: $73.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000011057/4100033224/CHEESE BLEND AMER SKM LVS-12/2 LB,CHEESE BLEND AMER SKM YEL SLC LVS-6/5 LB

Place of Performance

Location: HUMBOLDT, GIBSON County, TENNESSEE, 38343

State: Tennessee Government Spending

Plain-Language Summary

Department of Agriculture obligated $4.4 million to BONGARDS CREAMERIES for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000011057/4100033224/CHEESE BLEND AMER SKM LVS-12/2 LB,CHEESE BLEND AMER SKM YEL SLC LVS-6/5 LB Key points: 1. The contract for cheese blend for food donations is valued at $4.4 million. 2. Bongards Creameries is the sole awardee, raising questions about competition. 3. The firm fixed price contract type suggests price certainty. 4. The Agricultural Marketing Service is the contracting agency.

Value Assessment

Rating: fair

The contract value of $4.4 million for cheese blend appears reasonable given the 60-month duration. Benchmarking against similar food commodity contracts would provide a clearer assessment of value.

Cost Per Unit: $73,379 per month (estimated)

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating multiple vendors had the opportunity to bid. This method generally promotes competitive pricing and ensures the government receives the best value.

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

Public Impact

Ensures continued availability of cheese for federal food donation programs. Supports agricultural producers and the dairy industry through procurement. Contributes to national food security and assistance efforts.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of specific details on the competitive process and awardee selection.
Potential for price fluctuations in commodity markets over the 60-month period.

Positive Signals

Clear contract duration of 60 months provides supply stability.
Firm fixed price contract type offers budget predictability.

Sector Analysis

This contract falls within the food manufacturing sector, specifically cheese production. Government procurement of commodities for donation programs is a significant area of spending, often subject to specific agricultural policies and market dynamics.

Small Business Impact

The provided data does not indicate whether small businesses were involved in this procurement, either as prime contractors or subcontractors. Further analysis would be needed to assess small business participation.

Oversight & Accountability

The contract is managed by the Department of Agriculture's Agricultural Marketing Service. Standard oversight mechanisms for federal contracts, including performance monitoring and payment verification, are expected to be in place.

Related Government Programs

Cheese Manufacturing
Department of Agriculture Contracting
Agricultural Marketing Service Programs

Risk Flags

Potential for contractor profit margin to be higher than anticipated due to fixed pricing and market fluctuations.
Limited visibility into the specific competitive bids received and the rationale for award.
Dependence on a single awardee (Bongards Creameries) for a critical commodity over an extended period.
Lack of information regarding small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $4.4 million to BONGARDS CREAMERIES. COMMODITIES FOR USG FOOD DONATIONS: 2000011057/4100033224/CHEESE BLEND AMER SKM LVS-12/2 LB,CHEESE BLEND AMER SKM YEL SLC LVS-6/5 LB

Who is the contractor on this award?

The obligated recipient is BONGARDS CREAMERIES.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $4.4 million.

What is the period of performance?

Start: 2025-12-04. End: 2026-02-02.

What was the competitive landscape like for this cheese blend procurement, and how did the agency ensure the best price was achieved?

The contract was awarded under 'full and open competition,' suggesting multiple bids were solicited. However, without access to the bid details or awardee information beyond the prime contractor, it's difficult to definitively assess the competitiveness or confirm the 'best' price was achieved. The agency relies on the competitive process itself to drive favorable pricing.

What are the primary risks associated with a 60-month fixed-price contract for a commodity like cheese blend?

The primary risk is market volatility. While a fixed price protects the government from price increases, if market prices for raw materials (milk, etc.) or production costs decrease significantly, the contractor may realize unexpectedly high profits. Conversely, unforeseen supply chain disruptions or significant cost escalations beyond the contractor's control could pose a risk if not adequately addressed in contract terms.

How does this procurement contribute to the effectiveness of federal food donation programs?

This contract directly ensures a consistent and reliable supply of a key food item (cheese blend) for federal food donation programs. By securing this commodity for a 60-month period, the Department of Agriculture can better plan and execute its distribution to partner organizations, thereby enhancing the effectiveness of efforts to combat food insecurity and provide nutritional assistance to vulnerable populations.

Industry Classification

NAICS: Manufacturing › Dairy Product Manufacturing › Cheese Manufacturing

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: 123J1426B0034

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 13200 COUNTY ROAD 51, NORWOOD YOUNG AMERICA, MN, 55368

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

Financial Breakdown

Contract Ceiling: $4,402,742

Exercised Options: $4,402,742

Current Obligation: $4,402,742

Actual Outlays: $4,397,785

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline