USDA awards $200K for processed cheese, highlighting fixed-price contracts with economic adjustments

Contract Overview

Contract Amount: $199,782 ($199.8K)

Contractor: Great Lakes Cheese CO Inc

Awarding Agency: Department of Agriculture

Start Date: 2026-04-09

End Date: 2026-06-30

Contract Duration: 82 days

Daily Burn Rate: $2.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000011276/4400002545/4100033976/CHEESE PROCESS REG LVS-6/5 LB

Place of Performance

Location: LA CROSSE, LA CROSSE County, WISCONSIN, 54603

State: Wisconsin Government Spending

Plain-Language Summary

Department of Agriculture obligated $199,782 to GREAT LAKES CHEESE CO INC for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000011276/4400002545/4100033976/CHEESE PROCESS REG LVS-6/5 LB Key points: 1. Contract value of $199,782 for processed cheese indicates a moderate investment in food commodities. 2. The contract was awarded through full and open competition, suggesting a competitive bidding process. 3. The fixed-price structure with economic price adjustment aims to mitigate market volatility for cheese prices. 4. The delivery order is for a short duration, focusing on immediate or near-term needs. 5. The supplier, Great Lakes Cheese Co Inc., is a key player in the cheese manufacturing sector. 6. The contract falls under the 'Cheese Manufacturing' NAICS code, specifying the product category.

Value Assessment

Rating: good

The contract value of approximately $200,000 for 20,000 lbs of processed cheese appears reasonable given market rates for bulk food commodities. The fixed-price with economic price adjustment (FPEPA) contract type is common for food items susceptible to market fluctuations, aiming to balance cost control for the government with risk for the contractor. Without specific benchmarks for this exact type of processed cheese, a direct per-pound comparison is difficult, but the overall value seems aligned with typical government food procurement.

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 4 bids suggests a healthy level of interest and competition for this requirement. This competitive environment is expected to drive more favorable pricing and terms for the government compared to sole-source or limited competition awards.

Taxpayer Impact: Full and open competition generally leads to better value for taxpayers by ensuring that the government receives the most advantageous offer based on price and other factors.

Public Impact

Beneficiaries include recipients of U.S. government food donation programs, potentially including domestic food banks or international aid recipients. The service delivered is the provision of processed cheese, a key component in various food aid packages. The geographic impact is primarily within Wisconsin, where the supplier is located, but the ultimate distribution of the food product could be national or international. Workforce implications are tied to the manufacturing and logistics operations of Great Lakes Cheese Co Inc. and any subcontractors involved.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases due to economic price adjustment clause if cheese commodity prices rise significantly.
Short delivery window may limit the number of potential suppliers able to meet the demand.
Reliance on a single supplier for this specific delivery order.

Positive Signals

Awarded through full and open competition, indicating a competitive market.
Fixed-price element provides some cost certainty.
Supplier is an established entity in the cheese manufacturing industry.

Sector Analysis

The contract falls within the broader food manufacturing sector, specifically the cheese manufacturing sub-sector. This sector is characterized by large-scale production facilities and established supply chains. Government procurement of food commodities, such as this processed cheese, represents a consistent demand driver for manufacturers, often supporting domestic agricultural production and food assistance programs. Comparable spending benchmarks would involve analyzing other USDA food purchase contracts for similar commodities.

Small Business Impact

This contract does not appear to have a small business set-aside (ss=false, sb=false). The award to Great Lakes Cheese Co Inc., a potentially large manufacturer, suggests that small businesses may not have been the primary target for this specific procurement. However, the prime contractor may engage small businesses for subcontracting opportunities related to logistics or specialized processing, though this is not explicitly detailed in the provided data.

Oversight & Accountability

Oversight for this contract would primarily fall under the Agricultural Marketing Service (AMS) of the USDA. The contract type (Fixed Price with Economic Price Adjustment) requires monitoring of price adjustments to ensure they align with established economic indices. The delivery order structure allows for phased oversight of delivery and quality. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

USDA Food Donation Programs
Commodity Procurement Contracts
Agricultural Marketing Service Contracts
Food Manufacturing Sector Spending

Risk Flags

Economic Price Adjustment Clause
Short Delivery Window
Potential for Market Volatility

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $199,782 to GREAT LAKES CHEESE CO INC. COMMODITIES FOR USG FOOD DONATIONS: 2000011276/4400002545/4100033976/CHEESE PROCESS REG LVS-6/5 LB

Who is the contractor on this award?

The obligated recipient is GREAT LAKES CHEESE CO INC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $199,782.

What is the period of performance?

Start: 2026-04-09. End: 2026-06-30.

What is the historical spending pattern of the USDA with Great Lakes Cheese Co Inc. for similar processed cheese products?

Analyzing historical spending data for Great Lakes Cheese Co Inc. with the USDA, specifically for processed cheese or similar dairy products, would provide crucial context. A review of past contracts would reveal the frequency of awards, typical contract values, and the duration of previous engagements. This historical perspective helps assess the contractor's ongoing relationship with the agency and whether this current award represents a continuation of a long-standing partnership or a new business opportunity. Understanding past performance, including any issues or successes, can inform the assessment of value for money and potential risks associated with this current contract. Without access to a comprehensive federal procurement database or specific historical contract details, it is difficult to provide precise figures, but such an analysis is standard practice for federal spending analysts.

How does the per-pound cost of this processed cheese compare to other government procurements or commercial bulk purchases?

To benchmark the per-pound cost, we would need to know the exact quantity of cheese in pounds. Assuming the '5 LB' in the description refers to the package size and not the total quantity, and given the total award of $199,782, we can estimate a per-pound cost if the total weight is known. For instance, if the contract is for 20,000 lbs, the per-pound cost would be approximately $10. This figure would then be compared against recent USDA procurements of similar processed cheese (e.g., for school lunch programs or other food assistance initiatives) and against commercial bulk purchase prices. Factors like the specific type of cheese, fat content, and packaging can influence price. A higher per-pound cost than benchmarks might indicate less competitive bidding, higher quality specifications, or simply market price fluctuations.

What are the specific economic factors that trigger price adjustments under this contract?

The contract specifies a 'FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT' (FPEPA) type. This means the base price is fixed, but it can be adjusted based on pre-defined economic indicators. For cheese, these adjustments are typically tied to commodity market indices, such as the USDA's National Dairy Products Sales Report or specific cheese price indices published by industry groups. The contract's clause would detail the exact formula or index used and the frequency of review (e.g., monthly, quarterly). The purpose is to protect both the government from excessive price increases and the contractor from losses due to unforeseen market volatility. The specific trigger points and adjustment mechanisms are critical for understanding the potential final cost to the government.

What is the typical duration and value of similar USDA contracts for food commodities?

USDA contracts for food commodities, especially those for donation programs or food assistance, can vary significantly in duration and value. Short-term delivery orders, like the 82-day duration here (June 30 - April 9 is approximately 82 days), are common for immediate needs or specific events. Longer-term contracts might span a year or more, often with options for renewal. Values can range from tens of thousands to millions of dollars, depending on the commodity, quantity, and program requirements. This $200,000 contract for processed cheese appears to be a moderate-sized, short-term procurement, consistent with fulfilling specific, time-bound needs within the broader framework of USDA's food distribution efforts.

What are the potential risks associated with a short-duration delivery order for processed cheese?

Short-duration delivery orders, like this 82-day contract, carry specific risks. For the government, a primary risk is the potential for limited competition, as fewer suppliers may be able to mobilize resources for such a short timeframe. This could lead to higher prices or less favorable terms. For the contractor, the risk lies in accurately forecasting demand and production capacity to meet the tight delivery schedule without incurring excessive overtime or expedited shipping costs. There's also a risk of supply chain disruptions affecting the availability of raw materials or the ability to meet the delivery deadline. Furthermore, if the quality or specifications are not met within this short window, the government may need to quickly re-procure, potentially at a higher cost.

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: 123J1426B0130

Offers Received: 4

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

Evaluated Preference: NONE

Contractor Details

Address: 17825 GREAT LAKES PKWY, HIRAM, OH, 44234

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

Financial Breakdown

Contract Ceiling: $199,782

Exercised Options: $199,782

Current Obligation: $199,782

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 123J1426D0005

IDV Type: IDC

Timeline