Treasury's $3.6M gold bullion contract awarded to Asahi Refining USA Inc. for Utah delivery

Contract Overview

Contract Amount: $3,605,221 ($3.6M)

Contractor: Asahi Refining USA Inc

Awarding Agency: Department of the Treasury

Start Date: 2026-01-15

End Date: 2026-02-06

Contract Duration: 22 days

Daily Burn Rate: $163.9K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: RAW GOLD BULLION MINT MAC GOLD BULLION

Place of Performance

Location: SALT LAKE CITY, SALT LAKE County, UTAH, 84120

State: Utah Government Spending

Plain-Language Summary

Department of the Treasury obligated $3.6 million to ASAHI REFINING USA INC for work described as: RAW GOLD BULLION MINT MAC GOLD BULLION Key points: 1. Contract value of $3.6M for gold bullion acquisition. 2. Awarded under full and open competition, suggesting a competitive bidding process. 3. Delivery is scheduled for early 2026, indicating a near-term need. 4. The contract is for nonferrous metal rolling, drawing, and extruding, specifically gold bullion. 5. The fixed-price nature of the contract provides cost certainty for the government. 6. The contract duration is 22 days, suggesting a focused, short-term delivery requirement.

Value Assessment

Rating: good

The contract value of $3.6 million for gold bullion appears reasonable given market prices for precious metals. Benchmarking against similar government acquisitions of gold would provide a more precise value-for-money assessment. The firm fixed-price structure helps mitigate cost escalation risks for the government, ensuring predictable expenditure for this specific acquisition.

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 were likely solicited and evaluated. The open competition process is expected to foster price discovery and potentially lead to more favorable pricing for the government compared to sole-source or limited competition awards. The specific number of bidders is not provided, but the category suggests a robust competitive environment.

Taxpayer Impact: Taxpayers benefit from the potential for competitive pricing, ensuring that government funds are used efficiently when acquiring essential commodities like gold bullion.

Public Impact

The United States Mint benefits from the acquisition of gold bullion, likely for coinage or investment purposes. The services delivered involve the provision of refined gold bullion. Delivery is specified for Utah, indicating a specific geographic focus for this transaction. The contract supports the precious metals refining industry.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price volatility in the gold market impacting the value of the acquisition.
Dependence on a single supplier for this specific delivery order, despite full and open competition for the contract.

Positive Signals

Awarded through full and open competition, suggesting a fair and transparent process.
Firm fixed-price contract provides cost certainty.
Clear delivery timeline and location.

Sector Analysis

The acquisition of gold bullion falls within the broader precious metals and nonferrous metals sector. This sector is characterized by global commodity markets, price volatility, and specialized refining capabilities. Government purchases of gold are typically for strategic reserves, coinage programs, or investment vehicles. Comparable spending benchmarks would involve tracking historical purchases by the U.S. Mint or other government entities for similar precious metals.

Small Business Impact

The provided data indicates that small business participation (ss: false, sb: false) was not a specific set-aside criterion for this contract. Therefore, there are no direct subcontracting implications or specific impacts on the small business ecosystem stemming from small business set-aside provisions for this particular award. The primary contractor, Asahi Refining USA Inc., is likely a larger entity.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the U.S. Mint's contracting officers and potentially the Department of the Treasury's Inspector General. Accountability measures are embedded in the firm fixed-price contract terms, requiring delivery of specified goods by a certain date. Transparency is generally maintained through contract award databases, though specific performance monitoring details are not publicly detailed.

Related Government Programs

U.S. Mint Gold Coin Programs
Treasury Strategic Reserves
Precious Metals Market Operations

Risk Flags

Market Volatility Risk
Supply Chain Reliability
Quality Assurance of Bullion

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $3.6 million to ASAHI REFINING USA INC. RAW GOLD BULLION MINT MAC GOLD BULLION

Who is the contractor on this award?

The obligated recipient is ASAHI REFINING USA 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 $3.6 million.

What is the period of performance?

Start: 2026-01-15. End: 2026-02-06.

What is the historical spending pattern of the U.S. Mint on gold bullion acquisitions?

The U.S. Mint's spending on gold bullion can fluctuate significantly year-to-year, influenced by market conditions, legislative mandates for coinage programs (like American Eagle Gold Coins), and strategic reserve management. Historically, the Mint has purchased substantial quantities of gold, often through competitive bidding processes similar to this award. For instance, in years with high demand for bullion coins or when replenishing reserves, spending can reach tens or hundreds of millions of dollars. The specific amount for this contract, $3.6 million, represents a moderate acquisition. Analyzing annual reports and budget allocations for the U.S. Mint would provide detailed historical spending data, revealing trends in volume, price per ounce, and the number of suppliers utilized over time.

How does the price of this gold bullion contract compare to prevailing market rates at the time of award?

To assess the price competitiveness, one would need to compare the implied price per ounce within this $3.6 million contract against the spot price of gold around the award date. The contract specifies 'RAW GOLD BULLION', but not the exact purity or form. Assuming standard .999 fine gold, the total weight of gold acquired can be estimated if the price per ounce is known. For example, if the contract was awarded when gold was trading at $2,000 per ounce, a $3.6 million purchase would equate to approximately 1,800 ounces. Benchmarking this against the average market price during the solicitation and award period is crucial. Without the exact quantity or specific terms of the bullion, a precise comparison is difficult, but the firm fixed-price nature suggests the government aimed to lock in a price reflecting market conditions at the time of negotiation.

What are the specific risks associated with acquiring raw gold bullion for the government?

Key risks in acquiring raw gold bullion include market price volatility, where the value of the acquired asset could decrease post-purchase. There's also a risk of supply chain disruptions affecting delivery, although this is mitigated by the contract's defined delivery period. Counterparty risk, concerning the financial stability and reliability of the supplier (Asahi Refining USA Inc.), is another factor, though typically vetted during the procurement process. Furthermore, ensuring the authenticity and purity of the bullion is critical, requiring robust quality assurance measures. Lastly, storage and security costs for the acquired gold represent an ongoing financial commitment and risk.

What is the strategic importance of this gold bullion acquisition for the U.S. Mint?

This acquisition likely serves one or more strategic purposes for the U.S. Mint. It could be intended to replenish or expand the nation's official gold reserves, which are held for economic stability and as a store of value. Alternatively, the bullion may be destined for the production of U.S. Mint bullion coins (like American Eagles) or numismatic coins, catering to investor and collector demand. The timing of the acquisition, with delivery in early 2026, might align with anticipated market conditions, production schedules for coinage, or specific fiscal year objectives. The quantity, while substantial at $3.6 million, would need to be assessed against the Mint's overall inventory and production targets to fully understand its strategic weight.

How does the contract type (Firm Fixed Price) influence the government's risk and the contractor's incentive?

A Firm Fixed Price (FFP) contract, like this one, shifts the majority of the cost risk to the contractor (Asahi Refining USA Inc.). The government agrees to pay a set price regardless of the contractor's actual costs incurred. This provides the government with significant cost certainty and budget predictability, which is highly desirable for commodity purchases where market fluctuations can be substantial. For the contractor, the incentive is to manage their costs efficiently to maximize profit. If their costs exceed the fixed price, their profit margin shrinks or they incur a loss. Conversely, if they can perform the work or deliver the goods for less than the fixed price, their profit increases. This structure is well-suited for acquiring well-defined goods like gold bullion where the scope and specifications are clear.

Industry Classification

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

Product/Service Code: ORES, MINERALS AND PRIMARY PRODUCTS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Asahi Holdings, Inc.

Address: 4601 W 2100 S, SALT LAKE CITY, UT, 84120

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

Financial Breakdown

Contract Ceiling: $3,605,221

Exercised Options: $3,605,221

Current Obligation: $3,605,221

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 2031JG21D00006

IDV Type: IDC

Timeline