USDA awards $2.76M for breakfast cereals, with Post Consumer Brands securing the contract

Contract Overview

Contract Amount: $2,764,089 ($2.8M)

Contractor: Post Consumer Brands, LLC

Awarding Agency: Department of Agriculture

Start Date: 2025-11-20

End Date: 2026-04-01

Contract Duration: 132 days

Daily Burn Rate: $20.9K/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: 2000011073/4400002354/4100033187/CEREAL TOAST WHEAT 2160 PKG-10/16.4 OZ,CEREAL CORN FLKS 1440 PKG#14/12 OZ,CEREAL TOASTY O'S 1440 PKG-12/14 OZ,CEREAL RICE CRISP 1440 PKG-14/12 OZ

Place of Performance

Location: NORTHFIELD, RICE County, MINNESOTA, 55057

State: Minnesota Government Spending

Plain-Language Summary

Department of Agriculture obligated $2.8 million to POST CONSUMER BRANDS, LLC for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000011073/4400002354/4100033187/CEREAL TOAST WHEAT 2160 PKG-10/16.4 OZ,CEREAL CORN FLKS 1440 PKG#14/12 OZ,CEREAL TOASTY O'S 1440 PKG-12/14 OZ,CEREAL RICE CRISP 1440 PKG-14/12 OZ Key points: 1. Contract focuses on essential breakfast cereals for U.S. government food donations. 2. The award represents a significant portion of spending within the breakfast cereal manufacturing sector. 3. Competition dynamics suggest a potentially competitive bidding process for this food supply contract. 4. The fixed-price nature of the contract helps mitigate cost escalation risks for the government. 5. Performance will be monitored through delivery orders against a defined schedule. 6. This contract supports the broader mission of food assistance programs.

Value Assessment

Rating: good

The contract value of $2.76 million for 132 months of delivery orders appears reasonable for a large-scale food commodity procurement. Benchmarking against similar government contracts for bulk food items would provide a more precise value-for-money assessment. The firm fixed-price structure is a positive indicator for cost control. However, without specific per-unit pricing details or comparisons to commercial bulk pricing for these exact cereal types, a definitive value assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely solicited and considered. The presence of two bids suggests a degree of competition, which generally benefits the government by driving down prices and encouraging better terms. The specific number of bidders and the evaluation criteria would offer further insight into the intensity of the competition.

Taxpayer Impact: Full and open competition is favorable for taxpayers as it increases the likelihood of securing goods and services at the most competitive prices, minimizing potential overspending.

Public Impact

Beneficiaries include recipients of U.S. government food donation programs, likely including low-income households and disaster relief efforts. Services delivered involve the supply of various breakfast cereals such as Toast Wheat, Corn Flakes, Toasty O's, and Rice Crisp. The geographic impact is national, supporting food distribution networks across the United States. Workforce implications are primarily within the food manufacturing and logistics sectors, supporting jobs at Post Consumer Brands and related supply chains.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for supply chain disruptions affecting timely delivery of essential food items.
Ensuring consistent quality and nutritional value across all delivered cereal batches.
Monitoring contract performance to prevent scope creep or unapproved modifications.

Positive Signals

Award to a known manufacturer (Post Consumer Brands) suggests established production capabilities.
Firm fixed-price contract provides cost certainty for the government.
Delivery order structure allows for flexibility in quantities based on demand.

Sector Analysis

This contract falls within the broader food manufacturing sector, specifically the breakfast cereal sub-segment. The U.S. food manufacturing industry is vast, with cereal production being a mature market. Government procurement of staple food items like cereal is a consistent activity, often supporting domestic agriculture and food security initiatives. Comparable spending benchmarks would involve analyzing other large-scale food commodity contracts awarded by agencies like USDA or WFP.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses within the provided data. The award to a large corporation like Post Consumer Brands suggests that small businesses are unlikely to be direct beneficiaries of this specific prime contract. Further analysis would be needed to determine if Post Consumer Brands engages small businesses in its broader supply chain.

Oversight & Accountability

Oversight for this contract will likely be managed by the Agricultural Marketing Service (AMS) within the USDA. Accountability measures are embedded in the delivery order system and the firm fixed-price terms. Transparency is facilitated through federal procurement databases where contract awards are published. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

USDA Food Donation Programs
National School Lunch Program (NSLP) commodities
Commodity Supplemental Food Program (CSFP)
Federal Food, Conservation, and Energy Act of 2008
Emergency Food Assistance Program (TEFAP)

Risk Flags

Supply Chain Vulnerability
Quality Assurance
Price Volatility (mitigated by FFP)

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $2.8 million to POST CONSUMER BRANDS, LLC. COMMODITIES FOR USG FOOD DONATIONS: 2000011073/4400002354/4100033187/CEREAL TOAST WHEAT 2160 PKG-10/16.4 OZ,CEREAL CORN FLKS 1440 PKG#14/12 OZ,CEREAL TOASTY O'S 1440 PKG-12/14 OZ,CEREAL RICE CRISP 1440 PKG-14/12 OZ

Who is the contractor on this award?

The obligated recipient is POST CONSUMER BRANDS, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $2.8 million.

What is the period of performance?

Start: 2025-11-20. End: 2026-04-01.

What is the historical spending pattern for breakfast cereal procurement by the USDA?

Historical spending data for USDA breakfast cereal procurement reveals a consistent need for these commodities to support various food assistance programs. While specific figures fluctuate annually based on program needs and appropriations, the USDA regularly procures substantial quantities of cereals. For instance, in recent fiscal years, spending on similar food commodities has ranged in the tens of millions of dollars annually. This contract, valued at $2.76 million over its period, aligns with typical procurement volumes for such essential food items. Analyzing past solicitations and awards for similar items like corn flakes, wheat cereals, and oat-based products would provide a clearer trendline, indicating whether this award represents an increase, decrease, or stable level of procurement for breakfast cereals.

How does the per-unit cost of these cereals compare to commercial bulk pricing?

A precise per-unit cost comparison to commercial bulk pricing is not feasible with the provided data, as specific unit costs are not itemized. The contract value of $2.76 million covers various cereal types over a 132-month period, making a direct per-ounce or per-box comparison difficult without a detailed breakdown of quantities for each cereal type. Generally, government bulk purchases can achieve lower per-unit costs due to economies of scale and reduced distribution overhead compared to retail or smaller wholesale lots. However, factors like specific packaging requirements, delivery locations, and the competitive bidding process influence the final government price. To conduct a thorough comparison, one would need to obtain the detailed quantity breakdown per cereal type and compare it against current commercial bulk pricing from major distributors or manufacturers for identical or comparable products.

What is Post Consumer Brands' track record with USDA food procurement contracts?

Post Consumer Brands, LLC has a history of supplying food products, including cereals, to government agencies. Their track record with the USDA specifically for food donation commodities likely includes previous awards for similar items. A review of federal procurement databases (like FPDS or SAM.gov) would reveal the extent and value of their past contracts with the USDA and other federal entities. This information would indicate their reliability, past performance ratings, and experience in meeting government specifications and delivery schedules. A history of successful contract completions suggests a lower risk associated with this current award, while any past performance issues would warrant closer scrutiny.

What are the primary risks associated with this contract, and how are they mitigated?

The primary risks associated with this contract include potential supply chain disruptions that could affect the timely delivery of essential food items, and ensuring consistent quality and nutritional value across all delivered cereal batches. Mitigation strategies are in place: the contract is firm fixed-price, which caps the government's financial exposure to price increases. The delivery order (DO) structure allows for flexibility in ordering quantities based on actual demand, reducing the risk of overstocking or under-supplying. Furthermore, Post Consumer Brands' established position in the market suggests robust production and logistics capabilities. The USDA's oversight, including quality inspections and performance monitoring of delivery orders, further mitigates quality and delivery risks.

How does this contract contribute to the overall effectiveness of U.S. food donation programs?

This contract directly contributes to the effectiveness of U.S. food donation programs by ensuring a reliable supply of a staple breakfast food item. Breakfast cereals are a key component of nutritional support, providing essential carbohydrates and often fortified with vitamins and minerals. By securing these commodities through a competitive process, the USDA can maximize the quantity and quality of food available for distribution to eligible populations, such as low-income families, seniors, and disaster victims. Consistent availability of items like those procured under this contract helps these programs meet their objectives of alleviating hunger and improving food security across the nation. The efficiency of this procurement process, including the fixed-price terms, allows more resources to be directed towards the food itself rather than administrative costs.

Industry Classification

NAICS: Manufacturing › Grain and Oilseed Milling › Breakfast Cereal Manufacturing

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 123J1425B0267

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 20802 KENSINGTON BLVD, LAKEVILLE, MN, 55044

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $2,764,089

Exercised Options: $2,764,089

Current Obligation: $2,764,089

Actual Outlays: $625,089

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 123J1425D0020

IDV Type: IDC

Timeline