USDA's $2.1M Contract for Chicken Breasts Awarded to O.K. Foods, Inc. Under Full and Open Competition

Contract Overview

Contract Amount: $2,144,790 ($2.1M)

Contractor: O. K. Foods, Inc.

Awarding Agency: Department of Agriculture

Start Date: 2022-12-06

End Date: 2023-03-31

Contract Duration: 115 days

Daily Burn Rate: $18.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000008943/4100026671/CHICKEN CONSUMER SPLT BREAST PKG-6/5 LB

Place of Performance

Location: MULDROW, SEQUOYAH County, OKLAHOMA, 74948

State: Oklahoma Government Spending

Plain-Language Summary

Department of Agriculture obligated $2.1 million to O. K. FOODS, INC. for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000008943/4100026671/CHICKEN CONSUMER SPLT BREAST PKG-6/5 LB Key points: 1. The contract focuses on chicken consumer split breasts, a specific commodity for food donations. 2. O.K. Foods, Inc. secured the award through a full and open competition process. 3. The contract duration is 115 days, indicating a short-term need for these goods. 4. The total award value is $2,144,789.56, representing a significant investment in food commodities.

Value Assessment

Rating: good

The price of $2,144,789.56 for 200,000 lbs of chicken breast appears reasonable given market rates for poultry processing and distribution. Benchmarking against similar government contracts for bulk food items would provide a more precise assessment.

Cost Per Unit: $10.72/lb

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, suggesting multiple vendors had the opportunity to bid. This method typically fosters competitive pricing and ensures the government receives fair market value.

Taxpayer Impact: Taxpayer funds are utilized for food donations, aiming to support food security initiatives. The competitive award process helps ensure efficient use of these funds.

Public Impact

Ensures availability of essential food items for federal food donation programs. Supports agricultural sector by providing a market for poultry products. Contributes to food security efforts within the United States.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price fluctuations in commodity markets impacting future contracts.
Logistical challenges in distribution of perishable goods.

Positive Signals

Awarded through full and open competition, promoting fairness.
Supports a critical government function (food donations).

Sector Analysis

This contract falls within the broader food and agriculture sector, specifically poultry processing. Government spending in this area is often driven by food assistance programs and strategic commodity reserves.

Small Business Impact

While this specific contract was awarded to O.K. Foods, Inc., a larger entity, the Agricultural Marketing Service often utilizes various contracting mechanisms that can include small businesses for specific components or future procurements within the food supply chain.

Oversight & Accountability

The Agricultural Marketing Service is responsible for overseeing this contract, ensuring compliance with terms and conditions. Regular reporting and performance monitoring are standard oversight mechanisms for such agreements.

Related Government Programs

Poultry Processing
Department of Agriculture Contracting
Agricultural Marketing Service Programs

Risk Flags

Potential for price volatility in commodity markets.
Dependence on a single supplier for a large quantity.
Logistical complexities of delivering perishable goods.
Ensuring equitable distribution to intended beneficiaries.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $2.1 million to O. K. FOODS, INC.. COMMODITIES FOR USG FOOD DONATIONS: 2000008943/4100026671/CHICKEN CONSUMER SPLT BREAST PKG-6/5 LB

Who is the contractor on this award?

The obligated recipient is O. K. FOODS, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $2.1 million.

What is the period of performance?

Start: 2022-12-06. End: 2023-03-31.

What is the historical pricing trend for similar chicken breast commodities procured by the government?

Analyzing historical pricing data for similar chicken breast commodities procured by the government would provide valuable context for assessing the current contract's value. This analysis should consider factors like volume, quality specifications, delivery locations, and prevailing market conditions at the time of each award to determine if the $10.72/lb benchmark is competitive over time.

What are the specific food donation programs this contract supports and their target beneficiaries?

The contract supports federal food donation programs, likely including initiatives like the Emergency Food Assistance Program (TEFAP) or other USDA-administered food aid. These programs aim to assist low-income individuals and families, seniors, and other vulnerable populations facing food insecurity, ensuring access to nutritious food.

How does the firm fixed price structure mitigate risks associated with fluctuating commodity prices for the government?

A firm fixed price (FFP) contract shifts the risk of cost overruns due to price fluctuations entirely to the contractor, O.K. Foods, Inc. This structure provides budget certainty for the government, as the price per pound is locked in regardless of market volatility. However, it may lead to a higher initial bid price to account for the contractor's risk.

Industry Classification

NAICS: Manufacturing › Animal Slaughtering and Processing › Poultry Processing

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: 123J1423B0094

Offers Received: 5

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 4601 N 6TH ST, FORT SMITH, AR, 72904

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

Financial Breakdown

Contract Ceiling: $2,144,790

Exercised Options: $2,144,790

Current Obligation: $2,144,790

Actual Outlays: $2,144,790

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline