Agriculture Department awards $7.15M contract for rice, with 33 bids received under full and open competition

Contract Overview

Contract Amount: $7,154,426 ($7.2M)

Contractor: Supreme Rice, LLC

Awarding Agency: Department of Agriculture

Start Date: 2024-09-18

End Date: 2025-01-15

Contract Duration: 119 days

Daily Burn Rate: $60.1K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 33

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000010334/4210007129/RICE, 5/20 LG, W-MLD, FORT BAG-50 KG

Place of Performance

Location: MERMENTAU, ACADIA County, LOUISIANA, 70556

State: Louisiana Government Spending

Plain-Language Summary

Department of Agriculture obligated $7.2 million to SUPREME RICE, LLC for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000010334/4210007129/RICE, 5/20 LG, W-MLD, FORT BAG-50 KG Key points: 1. The contract value represents a significant investment in food commodities for donation programs. 2. Strong competition among 33 bidders suggests a healthy market for rice suppliers. 3. The firm fixed-price structure provides cost certainty for the government. 4. The contract duration of 119 days indicates a focused, short-term need for these specific commodities. 5. The award to SUPREME RICE, LLC highlights a key supplier in the federal food procurement landscape. 6. Geographic focus on Louisiana (LA) may reflect regional production or distribution advantages.

Value Assessment

Rating: good

The contract value of $7.15 million for 20,000 units of rice appears reasonable given the quantity and the competitive bidding process. Benchmarking against similar federal food donation contracts would provide a more precise value-for-money assessment. The firm fixed-price contract type helps mitigate cost overruns, contributing to predictable spending.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES,' indicating that while initial solicitations might have had restrictions, the final award was made after a broad competitive process. The receipt of 33 bids suggests robust market interest and a competitive environment, which typically drives down prices and improves value for the government.

Taxpayer Impact: A high number of bidders in a full and open competition generally benefits taxpayers by ensuring the government secures goods and services at the most competitive prices available in the market.

Public Impact

Beneficiaries of this contract are likely individuals and families receiving food assistance through government donation programs. The services delivered include the procurement and supply of essential rice commodities. The geographic impact is primarily focused on Louisiana (LA), suggesting potential distribution hubs or sourcing from this region. Workforce implications may include jobs in rice milling, processing, packaging, and logistics within the supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for supply chain disruptions impacting timely delivery of donated food.
Fluctuations in global rice prices could affect future contract costs if not adequately hedged.
Ensuring consistent quality and adherence to specifications across all delivered units.

Positive Signals

Strong competition indicates a reliable supplier base for essential food commodities.
Firm fixed-price contract provides budget certainty for the agency.
Awarding to a single supplier for a defined period streamlines procurement and delivery.

Sector Analysis

The federal government is a significant purchaser of agricultural commodities, including rice, for various domestic and international food assistance programs. This contract falls within the broader agricultural and food processing sector. The market for rice is global, with numerous producers and distributors. Federal procurement plays a role in stabilizing demand and supporting domestic agricultural output.

Small Business Impact

The contract was awarded under full and open competition and does not indicate a specific small business set-aside. While the primary awardee is SUPREME RICE, LLC, there is no explicit information on subcontracting plans with small businesses. Further review of the contract details or agency reporting would be needed to assess the impact on the small business ecosystem.

Oversight & Accountability

The contract is a Definitive Contract awarded by the Department of Agriculture's Agricultural Marketing Service. Oversight would typically involve contract officers, program managers, and potentially the agency's Inspector General to ensure compliance with terms, quality standards, and delivery schedules. Transparency is facilitated through federal procurement databases like FPDS.

Related Government Programs

USDA Food Donation Programs
Federal Food Procurement
Agricultural Commodity Purchases
Domestic Food Assistance

Risk Flags

Potential for supply chain disruptions
Price volatility of agricultural commodities
Ensuring quality compliance for food donations

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $7.2 million to SUPREME RICE, LLC. COMMODITIES FOR USG FOOD DONATIONS: 2000010334/4210007129/RICE, 5/20 LG, W-MLD, FORT BAG-50 KG

Who is the contractor on this award?

The obligated recipient is SUPREME RICE, LLC.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $7.2 million.

What is the period of performance?

Start: 2024-09-18. End: 2025-01-15.

What is the historical spending pattern for rice procurement by the Department of Agriculture for food donation programs?

Analyzing historical spending data for rice procurement by the USDA for food donation programs would reveal trends in contract values, quantities, and awardees over time. This contract's value of $7.15 million for approximately 20,000 units of rice can be compared to previous awards to assess if current pricing is consistent, higher, or lower. Understanding these patterns helps in budgeting, forecasting, and identifying potential market shifts or efficiencies. For instance, if similar quantities were procured at significantly lower prices in prior years, it might warrant a closer look at the current market conditions or the specific terms of this award. Conversely, if prices have risen due to inflation or market demand, this contract might represent good value. Data from sources like the Federal Procurement Data System (FPDS) would be essential for this analysis.

How does the per-unit cost of this rice contract compare to market rates or similar federal contracts?

To assess the per-unit cost, we need to divide the total contract value ($7,154,425.81) by the quantity of units (20,000). This yields a per-unit cost of approximately $357.72. Comparing this figure to market rates for bulk rice purchases (e.g., per metric ton or per 50kg bag) and to similar federal contracts awarded by agencies like the Defense Logistics Agency or other USDA programs would be crucial. If the market rate for a 50kg bag of rice is significantly lower, or if comparable federal contracts secured rice at a lower per-unit price, it could indicate that this contract is priced above market value. Conversely, if the per-unit cost aligns with or is below market and benchmarked contracts, it suggests favorable pricing. Factors like specific rice type, milling requirements, packaging, and delivery terms can influence per-unit costs, necessitating a nuanced comparison.

What is the track record of SUPREME RICE, LLC in fulfilling federal contracts, particularly for food commodities?

Evaluating the track record of SUPREME RICE, LLC involves examining their past performance on federal contracts. This includes reviewing contract completion history, on-time delivery rates, quality compliance, and any instances of disputes or contract terminations. Data from sources like the Contractor Performance Assessment Reporting System (CPARS) or FPDS can provide insights into their reliability and past performance. A history of successful, timely, and compliant contract fulfillment suggests a lower risk for this current award. Conversely, a pattern of performance issues could raise concerns about the government's ability to receive the specified rice commodities as per the contract terms and schedule. Understanding their experience with similar large-scale commodity procurements is also important.

What are the potential risks associated with the firm fixed-price contract type for this rice procurement?

The firm fixed-price (FFP) contract type generally offers the government the most cost certainty, as the price is set and not subject to adjustment based on the contractor's cost experience. For the government, the primary risk with FFP is that if the contractor can produce the goods at a lower cost than anticipated, the contractor retains the full profit. Conversely, if costs escalate unexpectedly for the contractor, they bear the loss, which could potentially lead to quality compromises or even contract default if the contractor becomes insolvent. In the context of agricultural commodities like rice, risks can include unforeseen weather events impacting supply, price volatility in the global market, or logistical challenges. While FFP protects against cost overruns for the government, it places the risk of cost increases squarely on the contractor.

How does the geographic focus on Louisiana (LA) impact the overall cost and logistics of this rice contract?

The specified location of Louisiana (LA) for this rice contract likely influences both cost and logistics. Louisiana is a major rice-producing state in the U.S., suggesting that sourcing the commodity locally could reduce transportation costs and lead times compared to procuring from distant regions. This proximity may also indicate that the milling and packaging facilities are located within or near the state, further streamlining the supply chain. However, the specific delivery points or distribution requirements are not detailed. If the rice is intended for distribution nationwide or internationally, the Louisiana origin might still involve significant onward transportation costs. Understanding the final destination of the donated rice is key to fully assessing the logistical implications and cost-effectiveness of the Louisiana focus.

Industry Classification

NAICS: Manufacturing › Grain and Oilseed Milling › Rice Milling

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SEALED BID

Solicitation ID: 121NMP24B0030

Offers Received: 33

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 530 W MILL ST, CROWLEY, LA, 70526

Business Categories: Category Business, Partnership or Limited Liability Partnership, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $7,154,426

Exercised Options: $7,154,426

Current Obligation: $7,154,426

Actual Outlays: $7,154,426

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline