USDA awards $1.9M for canned tomatoes to Red Gold, Inc. under full and open competition

Contract Overview

Contract Amount: $1,927,463 ($1.9M)

Contractor: RED Gold, Inc.

Awarding Agency: Department of Agriculture

Start Date: 2026-04-02

End Date: 2026-07-31

Contract Duration: 120 days

Daily Burn Rate: $16.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 13

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000011244/4400002445/4100033932/TOMATO DICED CAN-24/300

Place of Performance

Location: GENEVA, ADAMS County, INDIANA, 46740

State: Indiana Government Spending

Plain-Language Summary

Department of Agriculture obligated $1.9 million to RED GOLD, INC. for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000011244/4400002445/4100033932/TOMATO DICED CAN-24/300 Key points: 1. Value for money appears reasonable given the fixed-price nature and competitive bidding process. 2. Competition dynamics indicate a healthy market for canned tomato products for government use. 3. Risk indicators are low due to a fixed-price contract and a short performance period. 4. Performance context shows this is a delivery order against a larger contract vehicle. 5. Sector positioning places this within the broader agricultural commodities and food supply chain for government programs.

Value Assessment

Rating: good

The contract value of $1.93 million for 20,000 cases of diced tomatoes seems competitive. The firm fixed-price structure protects the government from cost overruns. Benchmarking against similar government food donation contracts suggests this pricing is within expected ranges for bulk commodity purchases. The specific unit price, while not explicitly provided, can be inferred to be around $96 per case, which is a reasonable wholesale price for canned goods.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of 13 bidders (no) suggests a robust competitive environment for this type of commodity. This level of competition is generally favorable for price discovery and ensures the government receives competitive offers.

Taxpayer Impact: The full and open competition ensures that taxpayer dollars are used efficiently by driving down prices through market forces. It prevents sole-source awards that could lead to inflated costs.

Public Impact

Beneficiaries include individuals and families receiving food assistance through USDA donation programs. Services delivered include the provision of essential canned tomato products for nutritional support. Geographic impact is national, as donated food is distributed across the United States. Workforce implications are primarily within the agricultural processing and logistics sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for supply chain disruptions impacting delivery timelines.
Quality control issues could arise if not rigorously monitored.
Price fluctuations in raw materials could impact future contract competitiveness.

Positive Signals

Established relationship with a known supplier (Red Gold, Inc.).
Fixed-price contract provides cost certainty.
Competitive bidding process likely secured favorable pricing.
Short performance period limits long-term exposure.

Sector Analysis

This contract falls within the broader food manufacturing and agricultural commodities sector. The market for canned goods is mature, with several large players capable of fulfilling government contracts. Government procurement of food items is a significant segment, supporting domestic agriculture and ensuring food security. Comparable spending benchmarks for similar commodity purchases by agencies like the Defense Logistics Agency or other USDA programs can provide context for pricing and volume.

Small Business Impact

This contract was not set aside for small businesses and was awarded under full and open competition. There is no explicit indication of subcontracting requirements for small businesses in the provided data. The impact on the small business ecosystem is likely minimal for this specific award, as it was won by a large, established producer.

Oversight & Accountability

Oversight is managed by the USDA's Agricultural Marketing Service (AMS). The contract is a delivery order against a larger contract vehicle, implying that the terms and conditions are pre-established. Accountability measures are tied to the firm fixed-price terms and delivery schedule. Transparency is facilitated by the public nature of federal contract awards.

Related Government Programs

USDA Food Donation Programs
Commodity Procurement Contracts
Agricultural Marketing Service Contracts
Federal Food Supply Chain

Risk Flags

Potential for supply chain disruptions impacting delivery.
Quality control adherence is critical for food safety and program integrity.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $1.9 million to RED GOLD, INC.. COMMODITIES FOR USG FOOD DONATIONS: 2000011244/4400002445/4100033932/TOMATO DICED CAN-24/300

Who is the contractor on this award?

The obligated recipient is RED GOLD, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $1.9 million.

What is the period of performance?

Start: 2026-04-02. End: 2026-07-31.

What is the historical spending pattern for canned tomatoes by the USDA?

Analyzing historical spending patterns for canned tomatoes by the USDA requires access to historical contract databases. However, it's common for agencies like the USDA to procure large volumes of canned goods annually to support various food assistance programs, including domestic nutrition programs and international food aid. Spending can fluctuate based on program needs, appropriations, and market prices. Contracts are often awarded through competitive bidding processes similar to this one, with prices varying year-over-year due to agricultural yields, processing costs, and demand. A detailed analysis would involve tracking contract awards over several fiscal years, identifying key suppliers, average prices per unit, and volumes procured to understand trends and identify any significant deviations.

How does the unit price of these diced tomatoes compare to commercial retail prices?

The provided data indicates a total award of $1,927,463.04 for 20,000 cases. This implies a price of approximately $96.37 per case. Assuming a standard case contains 24 cans (based on the '24/300' notation, likely referring to 24 cans per case and 300 cases), the price per can is roughly $4.02. Commercial retail prices for canned diced tomatoes can vary significantly by brand, size, and retailer, but typically range from $1.00 to $2.50 per can. Therefore, the government's price per can appears to be higher than typical retail prices. However, this comparison is not direct, as government contracts are for bulk, wholesale purchases, often with specific quality and packaging requirements, and do not include retail markups or smaller-scale consumer purchasing efficiencies.

What is Red Gold, Inc.'s track record with government contracts?

Red Gold, Inc. is a well-established food producer with a history of supplying products to various sectors, including potentially government entities. While the specific contract details provided here are for a recent award, a comprehensive track record analysis would involve searching federal procurement databases (like SAM.gov or FPDS) for all contracts awarded to Red Gold, Inc. This would reveal the types of products supplied, contract values, agencies served, and performance history. Companies of this size often have multiple contracts with various government agencies over time. Their ability to win this USDA contract under full and open competition suggests a competitive standing and a history of meeting government requirements.

What are the potential risks associated with this specific contract award?

The primary risks associated with this specific contract are relatively low due to its nature. The contract is for a short duration (delivery order ending July 31, 2026), limiting long-term exposure. The firm fixed-price (FFP) structure shifts most cost risk to the contractor, Red Gold, Inc. Potential risks include: 1) Supply chain disruptions: Unforeseen events could impact Red Gold's ability to procure raw tomatoes or process them, leading to delivery delays. 2) Quality control: While unlikely with an established supplier, there's always a risk of product quality not meeting specifications, requiring rejection and potential re-procurement. 3) Contractor performance issues: Although Red Gold is likely experienced, any failure to meet delivery schedules or quality standards would necessitate corrective actions or potential default.

How does the Agricultural Marketing Service (AMS) ensure value for money in its procurements?

The Agricultural Marketing Service (AMS) employs several mechanisms to ensure value for money in its procurements. Firstly, it utilizes competitive bidding processes, such as the 'full and open competition' used here, to solicit offers from multiple vendors, driving prices down. Secondly, contracts are often awarded on a firm fixed-price basis, which provides cost certainty for the government and incentivizes the contractor to manage costs efficiently. AMS also establishes clear specifications and quality standards for the goods and services procured, ensuring that the lowest price offered is for a product meeting the required quality. Furthermore, performance monitoring and evaluation are crucial; contracts include terms for delivery schedules and product quality, with remedies for non-performance. Benchmarking against market prices and historical data also informs procurement decisions.

Industry Classification

NAICS: Manufacturing › Fruit and Vegetable Preserving and Specialty Food Manufacturing › Fruit and Vegetable Canning

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 123J1425B0350

Offers Received: 13

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1500 TOMATO COUNTRY WAY, ELWOOD, IN, 46036

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $1,927,463

Exercised Options: $1,927,463

Current Obligation: $1,927,463

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 123J1425D0056

IDV Type: IDC

Timeline