Treasury Spends $41.7M on Silver Bullion from Sunshine Minting Inc. Under Full and Open Competition
Contract Overview
Contract Amount: $41,737,954 ($41.7M)
Contractor: Sunshine Minting Inc
Awarding Agency: Department of the Treasury
Start Date: 2011-03-14
End Date: 2011-03-18
Contract Duration: 4 days
Daily Burn Rate: $10.4M/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: PROVIDE RAW SILVER
Place of Performance
Location: COEUR D ALENE, KOOTENAI County, IDAHO, 83814
State: Idaho Government Spending
Plain-Language Summary
Department of the Treasury obligated $41.7 million to SUNSHINE MINTING INC for work described as: PROVIDE RAW SILVER Key points: 1. Significant expenditure on precious metals highlights a specific market segment. 2. Competition was open, suggesting potential for competitive pricing. 3. The contract's duration and fixed price structure offer cost predictability. 4. The sector is specialized, involving precious metal wholesale.
Value Assessment
Rating: fair
The contract value of $41.7M for silver bullion is substantial. Benchmarking against market prices for silver during the contract period (2011) would be necessary to fully assess value for money, as raw silver prices can be volatile.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which typically promotes competitive bidding and can lead to better pricing. The specific impact on price discovery depends on the number and quality of bids received.
Taxpayer Impact: Taxpayer funds were used for this purchase. The value derived depends on the market price of silver at the time of purchase and the efficiency of the procurement process.
Public Impact
Direct impact on the precious metals market through a large purchase. Potential for price fluctuations in silver due to significant demand. Government's role in managing strategic reserves or for coinage purposes.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Price volatility of silver commodity
- Market concentration of suppliers
Positive Signals
- Full and open competition
- Firm fixed price contract
Sector Analysis
The purchase falls within the wholesale trade of precious metals. Government spending in this sector can be influenced by needs for coinage, reserves, or specific industrial applications. Benchmarks are difficult without specific commodity market data.
Small Business Impact
The data does not indicate if small businesses were involved in this contract, either as prime contractors or subcontractors. Further investigation would be needed to determine small business participation.
Oversight & Accountability
The contract was awarded by the Department of the Treasury, United States Mint. Standard procurement oversight processes would apply, focusing on adherence to competition rules and contract terms.
Related Government Programs
- Jewelry, Watch, Precious Stone, and Precious Metal Merchant Wholesalers
- Department of the Treasury Contracting
- United States Mint Programs
Risk Flags
- Commodity price volatility
- Potential for supply chain disruptions
- Limited visibility into specific quantity purchased
- Dependence on market conditions for value assessment
Tags
jewelry-watch-precious-stone-and-preciou, department-of-the-treasury, id, po, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of the Treasury awarded $41.7 million to SUNSHINE MINTING INC. PROVIDE RAW SILVER
Who is the contractor on this award?
The obligated recipient is SUNSHINE MINTING 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 $41.7 million.
What is the period of performance?
Start: 2011-03-14. End: 2011-03-18.
What was the average price per ounce of silver purchased under this contract, and how did it compare to the market average at that time?
To determine the average price per ounce, the total contract value ($41,737,953.59) would need to be divided by the total quantity of silver purchased (which is not explicitly provided in the data). This calculated price should then be compared to the prevailing market price of silver during the contract period (March 2011) to assess if the government secured a favorable rate.
What were the specific risks associated with procuring a volatile commodity like silver, and how were they mitigated?
Risks include price volatility, supply chain disruptions, and potential market manipulation. Mitigation strategies could involve hedging, diversifying suppliers, securing long-term supply agreements, and conducting thorough market analysis before and during procurement. The firm fixed price contract offers some protection against price increases.
How effectively did the full and open competition process ensure the best value for taxpayer dollars in this specific procurement?
Full and open competition is designed to maximize value by encouraging multiple bids. Its effectiveness here depends on the number and competitiveness of the bids received. If only a few bidders participated or if the winning bid was not significantly lower than other offers, the value proposition might be less pronounced.
Industry Classification
NAICS: Wholesale Trade › Miscellaneous Durable Goods Merchant Wholesalers › Jewelry, Watch, Precious Stone, and Precious Metal Merchant Wholesalers
Product/Service Code: ORES, MINERALS AND PRIMARY PRODUCTS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 7600 N MINERAL DR STE 700, COEUR D ALENE, ID, 01
Business Categories: Category Business, Manufacturer of Goods, Small Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $41,737,954
Exercised Options: $41,737,954
Current Obligation: $41,737,954
Timeline
Start Date: 2011-03-14
Current End Date: 2011-03-18
Potential End Date: 2011-03-18 00:00:00
Last Modified: 2011-03-17
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