USDA awards $28.9M contract to CHS INC. for food commodities, impacting food donation programs

Contract Overview

Contract Amount: $28,863,660 ($28.9M)

Contractor: CHS Inc.

Awarding Agency: Department of Agriculture

Start Date: 2023-02-08

End Date: 2023-04-20

Contract Duration: 71 days

Daily Burn Rate: $406.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000009094/4210006496/

Place of Performance

Location: SAINT PAUL, RAMSEY County, MINNESOTA, 55164

State: Minnesota Government Spending

Plain-Language Summary

Department of Agriculture obligated $28.9 million to CHS INC. for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000009094/4210006496/ Key points: 1. The contract value of $28.9 million is significant for food donation programs. 2. CHS INC. is a major player in agricultural commodities, indicating potential for strong supply. 3. The contract's short duration (71 days) may limit long-term planning for recipients. 4. This award falls within the 'All Other Miscellaneous Food Manufacturing' sector.

Value Assessment

Rating: good

The contract value of $28.9 million for 71 days of supply seems reasonable given the scale of food donations. Benchmarking against similar large-scale commodity procurements would provide further context.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting a competitive bidding process that likely led to a fair price discovery. The number of offers (4) supports this.

Taxpayer Impact: This contract directly supports federal food donation programs, ensuring essential food supplies reach those in need, thus representing efficient use of taxpayer funds for social welfare.

Public Impact

Ensures availability of essential food commodities for federal donation programs. Supports agricultural producers and the food manufacturing sector. Aids in fulfilling the government's commitment to food security and assistance programs.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Short contract duration may create supply chain uncertainties for recipients.
Limited visibility into specific commodity types procured.

Positive Signals

Awarded through full and open competition.
Significant value indicates substantial support for donation programs.

Sector Analysis

This contract falls under the 'All Other Miscellaneous Food Manufacturing' sector, which is broad. Benchmarking requires understanding the specific types of commodities procured and their market prices.

Small Business Impact

The data does not indicate if small businesses were involved as subcontractors or suppliers. Further analysis would be needed to assess small business participation.

Oversight & Accountability

The contract was awarded by the Department of Agriculture's Agricultural Marketing Service, a relevant agency for commodity procurement. Oversight would focus on delivery and quality of goods.

Related Government Programs

All Other Miscellaneous Food Manufacturing
Department of Agriculture Contracting
Agricultural Marketing Service Programs

Risk Flags

Short contract duration
Lack of specific commodity details
Potential for supply chain disruption if follow-on contracts are delayed

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $28.9 million to CHS INC.. COMMODITIES FOR USG FOOD DONATIONS: 2000009094/4210006496/

Who is the contractor on this award?

The obligated recipient is CHS INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $28.9 million.

What is the period of performance?

Start: 2023-02-08. End: 2023-04-20.

What specific food commodities were procured under this contract and how do their prices compare to market rates?

The provided data does not specify the exact food commodities. To assess value, a detailed breakdown of the procured items (e.g., grains, canned goods, dairy) and their unit prices would be necessary. Comparing these unit prices against prevailing market indices for similar quality and quantity would reveal if the $28.9 million represented a fair market value.

What are the potential risks associated with the short 71-day duration of this contract for food donation recipients?

The short 71-day duration poses a risk of supply disruption for food donation programs that rely on consistent commodity flow. Recipients may face challenges in planning their distribution schedules and ensuring continuous support for beneficiaries. This could necessitate rapid re-procurement or reliance on alternative, potentially less stable, sources.

How effectively does this contract contribute to the overall goals of federal food donation and assistance programs?

This contract significantly contributes by providing a substantial volume of food commodities, directly supporting the operational capacity of federal food donation programs. The firm fixed-price structure ensures cost certainty for the government. Its effectiveness hinges on timely delivery and the nutritional appropriateness of the procured items for the target populations.

Industry Classification

NAICS: Manufacturing › Other Food Manufacturing › All Other Miscellaneous Food Manufacturing

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: 121NAG23B0010

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 5500, CENEX DRIVE, INVER GROVE HEIGHTS, MN, 55077

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

Financial Breakdown

Contract Ceiling: $28,863,660

Exercised Options: $28,863,660

Current Obligation: $28,863,660

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline