USDA awards $33.1M contract for almonds, highlighting significant investment in food donation commodities

Contract Overview

Contract Amount: $33,114,635 ($33.1M)

Contractor: Pearl Crop, Inc.

Awarding Agency: Department of Agriculture

Start Date: 2023-07-11

End Date: 2023-12-31

Contract Duration: 173 days

Daily Burn Rate: $191.4K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 11

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000009408/4100027946/ALMONDS ROASTED WHOLE SHELL PKG-12/2 LB,ALMOND NATURAL WHOLE SHELL CTN-12/2 LB

Place of Performance

Location: LODI, SAN JOAQUIN County, CALIFORNIA, 95240

State: California Government Spending

Plain-Language Summary

Department of Agriculture obligated $33.1 million to PEARL CROP, INC. for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000009408/4100027946/ALMONDS ROASTED WHOLE SHELL PKG-12/2 LB,ALMOND NATURAL WHOLE SHELL CTN-12/2 LB Key points: 1. The contract value represents a substantial commitment to procuring food items for donation programs. 2. Competition dynamics for this contract are noted as 'Full and Open Competition After Exclusion of Sources', suggesting a controlled but competitive bidding process. 3. The fixed-price contract type indicates predictable costs for the government. 4. The duration of 173 days suggests a focused procurement for a specific period. 5. The award to PEARL CROP, INC. positions them as a key supplier for this commodity. 6. The geographic origin of the almonds is California, a major almond-producing state.

Value Assessment

Rating: good

The contract value of $33.1 million for 200,000 cases of almonds appears reasonable given the quantity and the nature of the commodity. Benchmarking against similar large-scale food procurement contracts for donation programs would provide further context, but the fixed-price nature suggests cost certainty. The specific unit pricing is not detailed here, but the overall award reflects a significant investment in supporting food assistance initiatives.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded under 'Full and Open Competition After Exclusion of Sources'. This indicates that while the competition was intended to be broad, certain sources may have been excluded prior to the main solicitation. The presence of 11 bidders suggests a healthy level of interest, but the exclusion clause warrants further examination to understand its impact on the final price and the range of potential suppliers considered.

Taxpayer Impact: The competitive process, even with exclusions, aimed to secure a fair price for taxpayers. The number of bidders suggests that the government likely received competitive offers, contributing to value for money.

Public Impact

Beneficiaries of this contract are individuals and families receiving food assistance through USDA donation programs. The services delivered include the procurement and supply of roasted whole shell almonds. The geographic impact is national, as the donated food will be distributed across various regions. The contract supports the agricultural sector in California by providing a significant market for almond producers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for limited supplier pool due to 'Exclusion of Sources' clause.
Reliance on a single commodity type could pose supply chain risks if unforeseen issues arise.
Fixed-price contracts can sometimes lead to less flexibility if market conditions change drastically.

Positive Signals

Significant investment in food security and donation programs.
Award to a single, established supplier can ensure consistent quality and delivery.
California origin supports a key domestic agricultural industry.

Sector Analysis

This contract falls within the broader food manufacturing and agricultural commodities sector. The market for nuts, particularly almonds, is substantial globally and domestically. The USDA's role in procuring these items for donation programs represents a significant portion of government spending within this niche, aiming to address food insecurity while also supporting agricultural markets. Comparable spending benchmarks would involve analyzing other large-scale food procurement contracts for federal assistance programs.

Small Business Impact

This contract does not appear to have a small business set-aside component (ss: false, sb: false). While PEARL CROP, INC. may be a large business, the implications for small businesses in the almond supply chain are indirect. Small farms and processors may benefit from increased demand from the prime contractor, but there is no direct subcontracting requirement specified for small businesses in the provided data.

Oversight & Accountability

Oversight for this contract would typically be managed by the Agricultural Marketing Service (AMS) within the USDA. Accountability measures are inherent in the definitive contract structure, which outlines specific deliverables and timelines. Transparency is facilitated through contract award databases, though detailed performance metrics are not provided here. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

USDA Food Donation Programs
Commodity Procurement for Federal Nutrition Assistance
Agricultural Marketing Service Contracts
Domestic Food Assistance Initiatives

Risk Flags

Potential supply chain disruption risk due to single supplier.
Limited transparency on specific 'exclusion of sources' criteria.
Need for detailed unit cost benchmarking against market rates.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $33.1 million to PEARL CROP, INC.. COMMODITIES FOR USG FOOD DONATIONS: 2000009408/4100027946/ALMONDS ROASTED WHOLE SHELL PKG-12/2 LB,ALMOND NATURAL WHOLE SHELL CTN-12/2 LB

Who is the contractor on this award?

The obligated recipient is PEARL CROP, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $33.1 million.

What is the period of performance?

Start: 2023-07-11. End: 2023-12-31.

What is the historical spending pattern for almond procurement by the USDA for donation purposes?

Analyzing historical spending data for almond procurement by the USDA for donation purposes is crucial for understanding trends and establishing benchmarks. Without specific historical data for this contract vehicle, we can infer that the USDA engages in regular procurement of commodities to support its various food assistance programs. Past awards for similar items, such as other nuts or dried fruits, could provide context on price fluctuations, volume consistency, and supplier stability. A review of previous fiscal years' spending on food donations would reveal if this $33.1 million award represents an increase, decrease, or stable level of investment in almond procurement. It would also highlight any recurring contractors or shifts in procurement strategies over time.

How does the unit cost of these almonds compare to market rates for similar quality products?

Determining the precise unit cost requires knowing the exact quantity (e.g., pounds or kilograms) of almonds procured under this $33.1 million contract. The data mentions '2000009408/4100027946/ALMONDS ROASTED WHOLE SHELL PKG-12/2 LB', suggesting a large volume. If we assume the 'PKG-12/2 LB' refers to 12 packages of 2 lbs each per case, that's 24 lbs per case. With 200,000 cases, the total weight would be approximately 4.8 million lbs. Dividing the total contract value ($33,114,635.40) by the total pounds yields a unit cost of roughly $6.90 per pound. This price needs to be benchmarked against current wholesale market rates for roasted whole shell almonds of comparable quality, origin (California), and packaging, considering bulk purchase discounts. Market fluctuations, specific roasting profiles, and packaging standards will influence this comparison.

What are the specific criteria used to exclude certain sources in this 'Full and Open Competition After Exclusion of Sources' award?

The designation 'Full and Open Competition After Exclusion of Sources' implies that the contracting agency, in this case, the USDA's Agricultural Marketing Service, identified specific potential sources that were deemed ineligible or unsuitable for this particular procurement before releasing the solicitation. The reasons for exclusion are typically documented in the contract file and can include factors such as past performance issues, failure to meet specific technical requirements in previous solicitations, inability to meet security or compliance standards, or even geographic limitations if certain logistical constraints were paramount. Without access to the detailed contract file or pre-solicitation notices, the exact criteria remain unspecified. However, the agency must have a justifiable basis for such exclusions to ensure fairness and compliance with federal procurement regulations.

What is the track record of PEARL CROP, INC. in fulfilling large-scale government contracts, particularly for food commodities?

PEARL CROP, INC. is identified as the awardee for this $33.1 million contract. To assess their track record, a review of their past performance on federal contracts, especially those involving large volumes of agricultural commodities or food products for government programs like food donations or military rations, would be necessary. Information on contract completion timeliness, quality of goods delivered, adherence to specifications, and any history of disputes or contract terminations would be pertinent. Databases like the Federal Procurement Data System (FPDS) or the Contractor Performance Assessment Reporting System (CPARS) could provide insights into their performance history. A strong track record would indicate reliability and capability in managing such significant procurements.

What are the potential risks associated with relying on a single supplier for such a large quantity of almonds?

Relying on a single supplier, PEARL CROP, INC., for 200,000 cases of almonds introduces several potential risks. Firstly, supply chain disruptions are a primary concern; unforeseen events such as natural disasters affecting crops in California, transportation issues, labor strikes, or the supplier's own operational problems could lead to shortages or delays. Secondly, a lack of competition post-award could potentially limit the government's leverage in future negotiations or if quality issues arise. Thirdly, the supplier's financial stability or business continuity could become a risk factor over the contract's duration. Mitigating these risks often involves robust contract management, clear performance standards, contingency planning, and potentially exploring alternative sourcing options for future procurements.

How does this contract contribute to the USDA's broader mission of food security and agricultural support?

This $33.1 million contract directly supports the USDA's mission in multiple ways. Firstly, it addresses food security by procuring essential food items (almonds) for donation programs, which help alleviate hunger and improve nutrition among vulnerable populations. Secondly, it provides significant economic support to the agricultural sector, specifically almond growers and processors in California, by guaranteeing a large purchase volume at a set price. This stabilizes demand and provides revenue for producers. By investing in these commodities, the USDA not only fulfills its humanitarian objectives but also reinforces the viability and strength of domestic agriculture, aligning with its broader mandate to support farmers and ensure a stable food supply.

Industry Classification

NAICS: Manufacturing › Other Food Manufacturing › Roasted Nuts and Peanut Butter Manufacturing

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SEALED BID

Solicitation ID: 123J1423B0459

Offers Received: 11

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1550 INDUSTRIAL DR, STOCKTON, CA, 95206

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

Financial Breakdown

Contract Ceiling: $33,114,635

Exercised Options: $33,114,635

Current Obligation: $33,114,635

Actual Outlays: $32,242,428

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline