USDA awards $850K for cheese to Dairyland Trading Co. under full and open competition

Contract Overview

Contract Amount: $849,040 ($849.0K)

Contractor: Dairyland Trading CO LLC

Awarding Agency: Department of Agriculture

Start Date: 2026-02-18

End Date: 2026-04-15

Contract Duration: 56 days

Daily Burn Rate: $15.2K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 8

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000011191/4400002537/4100033795/CHEESE NAT AMER FBD BARREL-500 LB(40800)

Place of Performance

Location: LITCHFIELD, MEEKER County, MINNESOTA, 55355

State: Minnesota Government Spending

Plain-Language Summary

Department of Agriculture obligated $849,039.84 to DAIRYLAND TRADING CO LLC for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000011191/4400002537/4100033795/CHEESE NAT AMER FBD BARREL-500 LB(40800) Key points: 1. The contract is for 500 lb barrels of American cheese, with delivery by April 2026. 2. Dairyland Trading Co. LLC secured the award, indicating a competitive market for food commodities. 3. The fixed-price contract with economic price adjustment introduces potential cost volatility. 4. This spending supports domestic food assistance programs, aligning with agricultural marketing service goals.

Value Assessment

Rating: good

The award amount of $849,039.84 for cheese appears reasonable given the quantity and duration. Benchmarking against similar commodity contracts would provide a more precise valuation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded through full and open competition, suggesting a robust price discovery process. Multiple bids were likely considered, leading to a competitive price.

Taxpayer Impact: Taxpayer funds are used efficiently by leveraging competition to procure essential food commodities for donation programs.

Public Impact

Ensures availability of cheese for federal food donation programs, supporting food security initiatives. Benefits American dairy farmers and processors through government procurement. Provides a stable supply of a key commodity for nutritional assistance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Economic price adjustment clause may lead to cost overruns if market prices increase significantly.

Positive Signals

Awarded through full and open competition, ensuring fair pricing.
Supports domestic agriculture and food assistance programs.

Sector Analysis

This contract falls under agricultural commodities procurement, specifically for food donations. Spending benchmarks for similar food commodity contracts vary widely based on type and quantity.

Small Business Impact

The data does not indicate if Dairyland Trading Co. LLC is a small business. Further analysis is needed to determine the impact on small business participation in federal food procurement.

Oversight & Accountability

The Agricultural Marketing Service is responsible for overseeing this contract. Standard procurement regulations and oversight mechanisms should ensure accountability.

Related Government Programs

Cheese Manufacturing
Department of Agriculture Contracting
Agricultural Marketing Service Programs

Risk Flags

Economic price adjustment
Potential for market price volatility
Lack of small business participation data

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $849,039.84 to DAIRYLAND TRADING CO LLC. COMMODITIES FOR USG FOOD DONATIONS: 2000011191/4400002537/4100033795/CHEESE NAT AMER FBD BARREL-500 LB(40800)

Who is the contractor on this award?

The obligated recipient is DAIRYLAND TRADING CO LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $849,039.84.

What is the period of performance?

Start: 2026-02-18. End: 2026-04-15.

What is the historical price trend for American cheese barrels of this size?

Analyzing historical price trends for 500 lb barrels of American cheese is crucial for understanding the baseline cost and the potential impact of the economic price adjustment. This data would help assess if the initial fixed price is competitive and how much fluctuation the adjustment clause might cover, ultimately informing the total taxpayer exposure.

What was the number of bids received during the full and open competition?

The number of bids received during the full and open competition provides a direct measure of market interest and competitive pressure. A higher number of bids generally suggests a more robust competition and a greater likelihood of achieving the best possible price for the government. Conversely, few bids might indicate market limitations or potential issues with the solicitation.

How does the per-unit cost compare to similar food donation commodity contracts?

Comparing the per-unit cost of this cheese contract to similar food donation commodity contracts is essential for evaluating value for money. Benchmarking against contracts for items like butter, milk powder, or other protein sources, adjusted for nutritional value and market conditions, will reveal if this award represents an efficient use of taxpayer funds or if there are opportunities for cost savings in future procurements.

Industry Classification

NAICS: Manufacturing › Dairy Product Manufacturing › Cheese Manufacturing

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 123J1426B0118

Offers Received: 8

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Evaluated Preference: NONE

Contractor Details

Address: 2200 DICKINSON RD, DE PERE, WI, 54115

Business Categories: Category Business, Limited Liability Corporation, Manufacturer of Goods, Partnership or Limited Liability Partnership, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $849,040

Exercised Options: $849,040

Current Obligation: $849,040

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 123J1426D0010

IDV Type: IDC

Timeline