Treasury's Mint awarded $22.6M for nonferrous metals, with Mitsui & Co. securing the deal

Contract Overview

Contract Amount: $22,557,122 ($22.6M)

Contractor: Mitsui & CO. Precious Metals, Inc.

Awarding Agency: Department of the Treasury

Start Date: 2010-06-09

End Date: 2010-06-10

Contract Duration: 1 days

Daily Burn Rate: $22.6M/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PROVIDE RAW GOLD MATERIAL

Place of Performance

Location: NEW YORK, NEW YORK County, NEW YORK, 10166

State: New York Government Spending

Plain-Language Summary

Department of the Treasury obligated $22.6 million to MITSUI & CO. PRECIOUS METALS, INC. for work described as: PROVIDE RAW GOLD MATERIAL Key points: 1. The contract value represents a significant investment in essential raw materials for minting operations. 2. Full and open competition suggests a robust market for these specialized metals. 3. The single award indicates a potential concentration of supply or specialized capability. 4. The contract duration of one year points to a need for regular procurement cycles. 5. Fixed-price contracts aim to provide cost certainty for the government. 6. The geographic location of the contractor in New York may influence logistics and delivery.

Value Assessment

Rating: good

The contract value of $22.6 million for nonferrous metals appears reasonable given the specialized nature of the materials required by the U.S. Mint. Benchmarking against similar contracts for precious metals or specialized alloys would provide a more precise value-for-money assessment. However, the absence of specific details on the exact metals and quantities makes a definitive comparison challenging. The fixed-price nature of the award suggests an effort to control costs, but the ultimate value depends on market fluctuations and the contractor's efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The data does not specify the number of bidders, but this procurement method generally fosters competitive pricing. The U.S. Mint likely sought bids from various suppliers of nonferrous metals to ensure they obtain the best possible terms and quality.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it drives down prices through market forces and encourages a wider pool of suppliers, potentially leading to cost savings and innovation.

Public Impact

The primary beneficiaries are the U.S. Mint and, by extension, the public through the production of coinage and medals. The services delivered involve the supply of critical raw materials essential for minting operations. The geographic impact is primarily national, supporting the U.S. Mint's facilities. Workforce implications are likely concentrated within the contractor's operations and the U.S. Mint's production facilities.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price volatility in the nonferrous metals market impacting long-term cost-effectiveness.
Dependence on a single supplier could create risks if supply chains are disrupted.
Ensuring consistent quality and adherence to stringent specifications for minting is crucial.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
Fixed-price contract provides budget certainty for the U.S. Mint.
The contractor, Mitsui & Co. Precious Metals, Inc., is a known entity in the metals market, implying experience and reliability.

Sector Analysis

The contract falls within the broader metals and mining sector, specifically focusing on nonferrous metals. This sector is characterized by global supply chains, commodity price fluctuations, and significant industrial demand. The U.S. Mint's requirement for these specific metals highlights their critical role in manufacturing and national infrastructure. Comparable spending benchmarks would involve other government agencies procuring similar raw materials for manufacturing or industrial purposes.

Small Business Impact

The data indicates this contract was not set aside for small businesses (sb: false). As a large value contract for specialized metals, it is unlikely that small businesses would be primary awardees, though they could potentially participate as subcontractors to the prime contractor, Mitsui & Co. Precious Metals, Inc. The impact on the small business ecosystem would be indirect, depending on subcontracting opportunities.

Oversight & Accountability

Oversight for this contract would primarily reside with the U.S. Mint's contracting officers and program managers. Accountability measures are embedded in the firm fixed-price agreement, requiring the contractor to deliver specified materials at the agreed-upon price. Transparency is facilitated by the public nature of federal contract awards, though specific performance metrics and quality control details may not be publicly disclosed. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

U.S. Mint Coinage Production
Precious Metals Procurement
Industrial Raw Material Acquisition
Department of the Treasury Supply Chain Management

Risk Flags

Single awardee risk
Market price volatility for nonferrous metals
Supply chain disruption potential

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $22.6 million to MITSUI & CO. PRECIOUS METALS, INC.. PROVIDE RAW GOLD MATERIAL

Who is the contractor on this award?

The obligated recipient is MITSUI & CO. PRECIOUS METALS, 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 $22.6 million.

What is the period of performance?

Start: 2010-06-09. End: 2010-06-10.

What specific types of nonferrous metals were procured under this contract, and what are their primary uses by the U.S. Mint?

The contract specifies 'Nonferrous Metal (except Copper and Aluminum) Rolling, Drawing, and Extruding.' While the exact metals are not detailed in the provided data, this category typically includes materials like nickel, zinc, tin, lead, and potentially precious metals such as silver and gold, depending on the Mint's specific needs for coinage, medals, or other products. These metals are crucial for their unique properties, including malleability, durability, and aesthetic qualities, essential for producing circulating currency and commemorative items. The rolling, drawing, and extruding processes indicate the metals were likely required in specific forms, such as sheets, rods, or shapes, ready for further manufacturing.

How does the $22.6 million contract value compare to historical spending by the U.S. Mint for similar materials?

Without access to historical U.S. Mint procurement data for nonferrous metals, a direct comparison is difficult. However, the $22.6 million award for a one-year duration suggests a substantial and ongoing need for these materials. The U.S. Mint's annual production of circulating coins and commemorative medals requires significant quantities of various metals. Fluctuations in global metal prices and changes in production volume would influence year-over-year spending. A comprehensive analysis would require examining multi-year spending trends and the specific metal types procured in those periods to identify any significant deviations or patterns.

What are the potential risks associated with relying on Mitsui & Co. Precious Metals, Inc. as the sole awardee for this contract?

The primary risk associated with a sole awardee, even under full and open competition, is supply chain vulnerability. If Mitsui & Co. Precious Metals, Inc. faces production issues, logistical disruptions, or financial instability, it could directly impact the U.S. Mint's ability to acquire necessary materials. Furthermore, a single supplier may have less incentive to offer aggressive pricing in subsequent contract periods compared to a market with multiple viable suppliers. The Mint would need robust contract management and contingency planning to mitigate these risks, potentially including maintaining strategic reserves or identifying alternative suppliers.

What quality assurance measures are likely in place to ensure the nonferrous metals meet the U.S. Mint's stringent specifications?

The U.S. Mint has exceptionally high standards for the metals used in coinage due to the need for durability, specific weight, and aesthetic appeal. Quality assurance likely involves rigorous testing and inspection protocols at various stages, from material acceptance to final product. This could include chemical analysis to verify alloy composition, physical testing for strength and hardness, and dimensional checks. The contract would specify detailed technical requirements and performance standards, with penalties or rejection clauses for non-compliance. Mitsui & Co. Precious Metals, Inc., as an experienced supplier, would be expected to have its own internal quality control systems aligned with these government specifications.

How does the 'Nonferrous Metal (except Copper and Aluminum) Rolling, Drawing, and Extruding' classification inform the nature of the goods or services provided?

This classification indicates that the contract is for processed metal forms rather than raw ore or basic ingots. 'Rolling' refers to shaping metal into sheets or plates. 'Drawing' involves pulling metal through a die to create wires or rods. 'Extruding' uses compressive force to push metal through a die to form specific cross-sectional shapes. Therefore, the U.S. Mint is procuring metals that have already undergone significant manufacturing processes, making them closer to finished components ready for use in their minting operations, rather than basic raw materials requiring extensive initial processing.

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: SIMPLIFIED ACQUISITION

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Ellison Technologies Inc (UEI: 690546403)

Address: 200 PARK AVE FL 35, NEW YORK, NY, 90

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $22,557,122

Exercised Options: $22,557,122

Current Obligation: $22,557,122

Parent Contract

Parent Award PIID: TMHQ06C0034

IDV Type: BOA

Timeline