Treasury's $14.7M contract for base metals strip to support coinage production awarded to PMX Industries

Contract Overview

Contract Amount: $14,673,730 ($14.7M)

Contractor: PMX Industries, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2025-04-02

End Date: 2025-05-05

Contract Duration: 33 days

Daily Burn Rate: $444.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PROVIDE BASE METALS STRIP FOR CIRCULATING COINAGE.

Place of Performance

Location: CEDAR RAPIDS, LINN County, IOWA, 52404

State: Iowa Government Spending

Plain-Language Summary

Department of the Treasury obligated $14.7 million to PMX INDUSTRIES, INC. for work described as: PROVIDE BASE METALS STRIP FOR CIRCULATING COINAGE. Key points: 1. Contract aims to ensure a steady supply of essential materials for U.S. coinage. 2. Full and open competition suggests a potentially competitive pricing environment. 3. Short performance period indicates a focus on immediate supply needs. 4. Fixed-price contract type shifts performance risk to the contractor. 5. Awarded by the U.S. Mint, a key entity within the Treasury Department. 6. Material specification points to a critical input for national currency. 7. The contract value is modest relative to broader federal procurement activities.

Value Assessment

Rating: good

The contract value of $14.7 million for base metals strip appears reasonable for the specified materials and short duration. Benchmarking against similar contracts for metal supply to mints or industrial manufacturing would provide a clearer picture of value for money. The firm fixed-price structure suggests the contractor has assessed costs and risks, aiming for a specific profit margin. Without direct cost breakdowns or comparisons to market commodity prices at the time of award, a precise value assessment is challenging, but the competitive award process is a positive indicator.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The U.S. Mint sought proposals from a wide range of potential suppliers for the base metals strip. This approach generally fosters a competitive environment, encouraging multiple bidders to offer their best pricing and terms to secure the award. The presence of two bids suggests a degree of competition, though the specific number of interested parties and the spread of their proposals would offer deeper insights.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it typically drives down prices through market forces, ensuring the government obtains goods and services at the most favorable rates possible.

Public Impact

The primary beneficiaries are the U.S. Mint and, by extension, the public through the continued availability of circulating coinage. The contract delivers essential base metals strip, a critical raw material for producing coins. The geographic impact is national, as the materials will be used in U.S. currency production. Workforce implications are likely concentrated within PMX Industries, Inc. and its supply chain, potentially involving skilled labor in metal processing.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price volatility in base metal commodities impacting long-term supply costs if not managed.
Dependence on a single supplier for a critical component of coinage production.
Ensuring consistent quality and adherence to precise specifications for the metal strip is crucial.

Positive Signals

Award to an established company (PMX Industries) suggests a degree of reliability and experience.
Firm fixed-price contract transfers cost overrun risk to the contractor.
Short performance period allows for re-evaluation of needs and potential for future competitive sourcing.

Sector Analysis

This contract falls within the broader industrial manufacturing and materials sector, specifically focusing on non-ferrous metal processing. The market for base metals used in coinage is relatively specialized, often involving suppliers with specific capabilities to meet stringent purity and dimensional tolerances required by mints. Comparable spending benchmarks would involve other government agencies or large industrial consumers procuring similar metal products, though direct comparisons are difficult due to the unique specifications for coinage.

Small Business Impact

This contract does not appear to involve a small business set-aside. Given the nature of specialized metal processing and the scale of the requirement, it is unlikely that significant subcontracting opportunities for small businesses would arise directly from this award, unless PMX Industries voluntarily engages them for specific support services.

Oversight & Accountability

Oversight will be managed by the U.S. Mint, which is responsible for ensuring contract compliance, quality control, and timely delivery. Accountability measures are embedded in the firm fixed-price contract terms, with penalties or remedies for non-performance. Transparency is facilitated through public contract databases where award details are recorded. Inspector General jurisdiction would typically apply to investigations of fraud, waste, or abuse related to federal contracts.

Related Government Programs

U.S. Mint Coinage Production
Department of the Treasury Procurement
Industrial Materials Supply Chain
Base Metals Commodity Markets

Risk Flags

Supply Chain Vulnerability
Quality Control Risk
Price Volatility of Raw Materials

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $14.7 million to PMX INDUSTRIES, INC.. PROVIDE BASE METALS STRIP FOR CIRCULATING COINAGE.

Who is the contractor on this award?

The obligated recipient is PMX INDUSTRIES, INC..

Which agency awarded this contract?

Awarding agency: Department of the Treasury (United States Mint).

What is the total obligated amount?

The obligated amount is $14.7 million.

What is the period of performance?

Start: 2025-04-02. End: 2025-05-05.

What is the historical spending pattern of the U.S. Mint for base metals strip or similar raw materials?

Historical spending data for the U.S. Mint's procurement of base metals strip is not readily available in public databases without specific contract number searches. However, the Mint has a long-standing need for such materials to produce circulating coinage. Past awards would likely have been made to various metal suppliers based on competitive bidding processes. The frequency and value of these awards would fluctuate based on coinage demand, metal market prices, and the duration of awarded contracts. Analyzing trends in metal prices (e.g., copper, zinc, nickel) over several years would provide context for the Mint's budgeting and procurement strategies for these essential inputs.

How does the unit cost of this base metals strip compare to market rates for similar industrial metals?

Determining the precise unit cost and comparing it to market rates is challenging without knowing the exact alloy composition, dimensions (thickness, width), and specific quality certifications required for this base metals strip. Market rates for commodities like copper, zinc, and nickel fluctuate daily. The contract specifies 'base metals strip for circulating coinage,' implying specific alloys and tolerances that may command a premium over standard industrial grades. A thorough comparison would require accessing real-time commodity prices for the relevant metals at the time of award and factoring in any value-added processing or quality assurance provided by PMX Industries.

What is PMX Industries, Inc.'s track record with federal contracts, particularly with the U.S. Mint or similar agencies?

PMX Industries, Inc. has a history of federal contracting, though specific details regarding contracts with the U.S. Mint or similar agencies require deeper database analysis. As a manufacturer of metal products, their experience likely includes supplying materials to various industrial sectors. Federal contract databases would reveal the volume, types, and performance history of their awards. A review of past performance ratings, if available, would indicate their reliability in terms of quality, timeliness, and adherence to contract terms. Their ability to win this contract suggests they meet the U.S. Mint's requirements and possess the necessary certifications and production capabilities.

What are the potential risks associated with relying on PMX Industries for this critical coinage material?

Potential risks include supply chain disruptions affecting PMX Industries, such as raw material shortages, labor issues, or logistical challenges, which could impact the timely delivery of the base metals strip. Quality control is another risk; any deviation from the stringent specifications required for coinage could lead to production issues at the Mint. Furthermore, if PMX Industries faces financial instability or operational problems, it could jeopardize the supply. The short duration of the contract mitigates some long-term dependency risks, but ensures that the Mint must remain vigilant about supplier performance throughout the contract period.

How does the 'firm fixed price' contract type influence the government's financial exposure and the contractor's incentives?

A firm fixed-price (FFP) contract establishes a ceiling price that the government will not exceed, regardless of the contractor's actual costs. This shifts the financial risk of cost overruns entirely to the contractor (PMX Industries). Consequently, the contractor has a strong incentive to manage costs efficiently and perform the work within the agreed-upon budget to maximize profit. For the government, an FFP contract provides cost certainty, making budgeting more predictable. However, it also means that if the contractor achieves significant cost savings, the government does not benefit from those savings, as the price remains fixed.

Industry Classification

NAICS: Manufacturing › Nonferrous Metal (except Aluminum) Production and Processing › Copper Rolling, Drawing, Extruding, and Alloying

Product/Service Code: METAL BARS, SHEETS, SHAPES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Poongsan Corporation

Address: 5300 WILLOW CREEK DR SW, CEDAR RAPIDS, IA, 52404

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: $14,673,730

Exercised Options: $14,673,730

Current Obligation: $14,673,730

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 2031JG23D00002

IDV Type: IDC

Timeline