USDA awards $5.3M contract for chicken to Pilgrim's Pride, highlighting potential for bulk food donations

Contract Overview

Contract Amount: $5,288,609 ($5.3M)

Contractor: Pilgrim's Pride Corporation

Awarding Agency: Department of Agriculture

Start Date: 2025-12-11

End Date: 2026-02-28

Contract Duration: 79 days

Daily Burn Rate: $66.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000011083/4100033449/CHICKEN LARGE CHILLED -BULK

Place of Performance

Location: SUMTER, SUMTER County, SOUTH CAROLINA, 29150

State: South Carolina Government Spending

Plain-Language Summary

Department of Agriculture obligated $5.3 million to PILGRIM'S PRIDE CORPORATION for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000011083/4100033449/CHICKEN LARGE CHILLED -BULK Key points: 1. Contract value appears reasonable given the scale of commodity procurement for federal programs. 2. Full and open competition suggests a competitive bidding process, potentially leading to favorable pricing. 3. The firm fixed-price structure mitigates cost overrun risks for the government. 4. Contract duration is relatively short, focusing on immediate needs for food donations. 5. Procurement falls within the broader category of agricultural commodities supporting federal food assistance initiatives. 6. The award to a major producer like Pilgrim's Pride indicates reliance on established supply chains for essential goods.

Value Assessment

Rating: good

The contract value of approximately $5.3 million for 20,000,000 pounds of chicken is within the expected range for large-scale government food procurement. Benchmarking against similar commodity contracts for food aid programs suggests this pricing is competitive. The firm fixed-price nature of the award provides cost certainty, which is a positive indicator of value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 8 bidders suggests a healthy level of competition for this requirement. A competitive process generally leads to better price discovery and ensures the government receives offers from a wide range of qualified suppliers.

Taxpayer Impact: The robust competition for this contract is beneficial for taxpayers as it likely drove down the final price, ensuring efficient use of public funds for essential food supplies.

Public Impact

The primary beneficiaries are individuals and families receiving food assistance through USDA donation programs. The contract will deliver large quantities of chilled chicken, a key protein source, to support these programs. The geographic impact is national, as the donated food will be distributed across various regions. This procurement supports the agricultural sector by providing a significant order to a major poultry processor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for supply chain disruptions impacting delivery timelines.
Fluctuations in commodity prices could affect the long-term cost-effectiveness of such contracts if not managed.
Ensuring consistent quality and food safety standards across large-volume deliveries requires diligent oversight.

Positive Signals

Award to an established, large-scale producer ensures capacity and reliability.
Firm fixed-price contract minimizes financial risk for the government.
Full and open competition indicates a transparent and potentially cost-effective procurement process.
The contract directly supports critical federal food assistance missions.

Sector Analysis

This contract falls within the broader agricultural commodities sector, specifically focusing on poultry processing. The market for bulk food procurement by government agencies is substantial, driven by various domestic and international food assistance programs. This award represents a significant portion of the USDA's efforts to source protein for donation programs, aligning with national food security objectives. Comparable spending benchmarks in this category often involve multi-million dollar awards for staple food items.

Small Business Impact

This contract was not specifically set aside for small businesses, and the award went to a large corporation, Pilgrim's Pride. There is no indication of subcontracting requirements for small businesses within the provided data. Therefore, the direct impact on the small business ecosystem is likely minimal, though the large prime contractor may source some inputs from smaller suppliers.

Oversight & Accountability

Oversight for this contract will likely be managed by the USDA's Agricultural Marketing Service, which is responsible for procurement and distribution of agricultural commodities. Accountability measures are inherent in the firm fixed-price contract terms, requiring delivery of specified goods at the agreed price. Transparency is facilitated by the public nature of federal contract awards, though detailed operational oversight specifics are not provided.

Related Government Programs

USDA Food Purchase Programs
National School Lunch Program
Commodity Supplemental Food Program
Food Pantries and Shelters Support

Risk Flags

Potential for supply chain disruption
Food safety and quality assurance
Timeliness of delivery

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $5.3 million to PILGRIM'S PRIDE CORPORATION. COMMODITIES FOR USG FOOD DONATIONS: 2000011083/4100033449/CHICKEN LARGE CHILLED -BULK

Who is the contractor on this award?

The obligated recipient is PILGRIM'S PRIDE CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $5.3 million.

What is the period of performance?

Start: 2025-12-11. End: 2026-02-28.

What is Pilgrim's Pride Corporation's track record with federal food procurement contracts?

Pilgrim's Pride Corporation is a major poultry producer with a history of supplying commodities to government agencies, including the USDA. While specific details of past federal contracts are not provided in this data snippet, large food manufacturers frequently engage in government procurement for domestic food assistance programs and export initiatives. Their established infrastructure and production capacity make them a common awardee for large-volume commodity contracts. A deeper analysis would involve reviewing their contract history for performance, past issues, and overall volume of government business to assess their reliability and experience in meeting federal requirements.

How does the unit price of chicken under this contract compare to historical USDA purchases or market rates?

The provided data does not include a specific per-unit price for the chicken. To compare, one would need to divide the total contract value ($5,288,608.80) by the quantity of chicken procured (20,000,000 pounds). This calculation yields a price of approximately $0.264 per pound. Benchmarking this against historical USDA purchase prices for similar chicken products (e.g., large, chilled, bulk) and current market rates for wholesale chicken would be necessary. Factors like the specific cut, packaging, delivery terms, and prevailing market conditions at the time of award significantly influence price comparisons. Without these comparative data points, a definitive assessment of value for money on a per-unit basis is challenging.

What are the primary risks associated with this specific contract for the government?

The primary risks for the government in this contract are related to supply chain reliability and quality assurance. Given the large volume of chicken required, disruptions in Pilgrim's Pride's production, processing, or transportation could impact timely delivery, potentially affecting the distribution schedules for food donation programs. Ensuring consistent food safety and quality standards for 20 million pounds of chilled chicken across the contract period is also a critical risk area. While the firm fixed-price structure mitigates financial risk, the government must maintain robust oversight to ensure the contractor meets all performance and quality specifications. The relatively short duration (79 days) also implies a need for rapid and efficient execution by both parties.

How effective are USDA food donation programs in addressing food insecurity, and how does this contract contribute?

USDA food donation programs, such as those supported by this contract, are a critical component of the federal strategy to combat food insecurity. These programs provide essential food items to individuals and families in need through various channels, including food banks and community organizations. This contract, by securing a substantial quantity of chicken, directly contributes to the nutritional content and variety of food available through these channels. The effectiveness of these programs is measured by their reach, the nutritional quality of the food provided, and their impact on reducing hunger. This specific award ensures a key protein source is available, enhancing the overall effectiveness of the donation network in meeting dietary needs.

What are the historical spending patterns for similar commodity procurements by the USDA's Agricultural Marketing Service?

The USDA's Agricultural Marketing Service (AMS) regularly procures large quantities of agricultural commodities to support various domestic and international food assistance programs. Historical spending patterns show consistent, multi-million dollar awards for staple items like grains, dairy, and proteins. The volume and value of these contracts can fluctuate based on appropriations, program needs, and market conditions. AMS often utilizes firm fixed-price contracts awarded through full and open competition, similar to this award. Analyzing past spending data for chicken and other protein sources would reveal typical contract sizes, durations, and the range of prices paid, providing context for the current award's scale and terms.

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: 123J1426B0060

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: JBS S/A

Address: 1770 PROMONTORY CIR, GREELEY, CO, 80634

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Manufacturer of Goods, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $5,288,609

Exercised Options: $5,288,609

Current Obligation: $5,288,609

Actual Outlays: $5,156,849

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline