USDA awards $14.17M for rice commodities, with 8 bidders competing for a firm-fixed-price contract

Contract Overview

Contract Amount: $14,166,815 ($14.2M)

Contractor: Supreme Rice, LLC

Awarding Agency: Department of Agriculture

Start Date: 2023-08-01

End Date: 2024-06-30

Contract Duration: 334 days

Daily Burn Rate: $42.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000009471/4100028134/RICE US#2 MEDIUM GRAIN PKG-24/2 LB,RICE US#2 MEDIUM GRAIN PKG-30/2 LB,RICE US#2 LONG GRAIN PKG-24/2 LB

Place of Performance

Location: CROWLEY, ACADIA County, LOUISIANA, 70526

State: Louisiana Government Spending

Plain-Language Summary

Department of Agriculture obligated $14.2 million to SUPREME RICE, LLC for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000009471/4100028134/RICE US#2 MEDIUM GRAIN PKG-24/2 LB,RICE US#2 MEDIUM GRAIN PKG-30/2 LB,RICE US#2 LONG GRAIN PKG-24/2 LB Key points: 1. The contract value represents a significant investment in food donation commodities. 2. Strong competition among 8 bidders suggests a healthy market for rice supply. 3. The firm-fixed-price structure provides cost certainty for the government. 4. This award falls within the Agricultural Marketing Service's purview for commodity procurement. 5. The contract duration of 334 days allows for consistent supply. 6. The geographic focus on Louisiana for this procurement is noted.

Value Assessment

Rating: good

The contract value of $14.17 million for rice commodities appears reasonable given the quantity and type of goods procured for federal food donation programs. Benchmarking against similar large-scale commodity purchases for government programs indicates that pricing is generally competitive when multiple bidders are involved. The firm-fixed-price contract type helps manage cost fluctuations, which is a positive indicator for value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, with 8 distinct bidders participating. The presence of multiple bidders suggests a robust and competitive market for the specified rice commodities. This level of competition is generally favorable for price discovery and ensures the government receives competitive offers, potentially leading to better value.

Taxpayer Impact: The strong competition among 8 bidders is beneficial for taxpayers, as it likely drove down prices and ensured the government secured the commodities at a favorable market rate.

Public Impact

Beneficiaries of this contract include individuals and families receiving food assistance through federal donation programs. The services delivered involve the procurement and supply of essential rice commodities. The geographic impact is primarily within the United States, supporting domestic food security initiatives. Workforce implications include jobs in rice milling, packaging, and logistics.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for supply chain disruptions impacting delivery timelines.
Fluctuations in global rice prices could affect future procurement costs.
Ensuring consistent quality across all delivered rice lots.

Positive Signals

Strong competition indicates a reliable supplier base.
Firm-fixed-price contract mitigates cost overruns.
Clear specifications for rice quality and packaging.

Sector Analysis

This contract falls within the broader agricultural commodities sector, specifically focusing on rice procurement for federal food assistance programs. The market for agricultural commodities is vast and subject to global supply and demand dynamics, weather patterns, and trade policies. Government procurement of staple foods like rice plays a crucial role in supporting domestic agriculture and ensuring food security for vulnerable populations.

Small Business Impact

The data indicates that small businesses were not specifically set aside for this contract, nor is there explicit information on subcontracting with small businesses. Further analysis would be needed to determine the extent of small business participation or potential impact on the small business ecosystem within the rice milling and distribution sector.

Oversight & Accountability

Oversight for this contract is likely managed by the Agricultural Marketing Service (AMS) within the USDA. Accountability measures are embedded in the firm-fixed-price contract terms, requiring delivery of specified commodities. Transparency is generally maintained through federal contract databases, though specific performance metrics and ongoing oversight activities would require deeper investigation.

Related Government Programs

USDA Food Purchase Programs
National School Lunch Program
Commodity Supplemental Food Program
Federal Food Assistance Programs

Risk Flags

Potential for supply chain disruptions.
Price volatility in the global rice market.
Ensuring consistent product quality across all deliveries.

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $14.2 million to SUPREME RICE, LLC. COMMODITIES FOR USG FOOD DONATIONS: 2000009471/4100028134/RICE US#2 MEDIUM GRAIN PKG-24/2 LB,RICE US#2 MEDIUM GRAIN PKG-30/2 LB,RICE US#2 LONG GRAIN PKG-24/2 LB

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 $14.2 million.

What is the period of performance?

Start: 2023-08-01. End: 2024-06-30.

What is the historical spending pattern for rice procurement by the USDA for food donation programs?

Analyzing historical spending for rice procurement by the USDA for food donation programs requires accessing historical contract data. Typically, such procurements fluctuate based on appropriations, program needs, and market prices. For instance, in fiscal years with higher demand or lower market prices, spending might increase. Conversely, budget constraints or high commodity prices could lead to reduced spending or procurement of alternative food items. Examining data from the Federal Procurement Data System (FPDS) or similar repositories over the past 5-10 years would reveal trends in contract awards, quantities, and total expenditures for rice, allowing for a comparison to the current $14.17 million award.

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

Determining the precise per-unit cost requires breaking down the total award ($14.17 million) by the total quantity of rice procured, which is not fully detailed in the provided data (only package sizes are listed). However, if the total weight could be calculated, it could be compared to average wholesale prices for US #2 medium and long grain rice. For example, if the contract covered 10,000 metric tons, the per-metric-ton cost could be benchmarked against USDA's Agricultural Marketing Service (AMS) price reports or data from similar government contracts awarded to other agencies or for different programs. A higher-than-market rate, even with competition, could indicate specific quality requirements or logistical complexities driving up the price.

What is the track record of Supreme Rice, LLC as a government contractor, particularly for USDA food donations?

Supreme Rice, LLC's track record as a government contractor can be assessed by reviewing their past performance on federal contracts, especially those with the USDA and specifically for food donation programs. Data from the System for Award Management (SAM) or FPDS would show the number of contracts awarded, their values, performance ratings (if available), and any history of contract disputes or terminations. A history of successful, on-time deliveries of quality products at competitive prices would indicate reliability. Conversely, past issues could raise concerns about their capacity to fulfill this $14.17 million contract effectively.

What are the specific quality standards and packaging requirements for the rice, and how do they impact cost?

The contract specifies 'RICE US#2 MEDIUM GRAIN PKG-24/2 LB' and 'RICE US#2 LONG GRAIN PKG-24/2 LB'. This indicates US No. 2 grade rice, which has specific quality parameters regarding broken kernels, foreign material, and moisture content. The packaging requirement of 2-pound bags, sold in cases of 24, suggests a focus on consumer-ready or easily distributable units for food assistance programs. These specific quality and packaging requirements, while ensuring suitability for the intended recipients, can influence the cost compared to bulk commodity rice. Meeting these precise standards may necessitate additional processing, quality control, and specialized packaging, contributing to the overall contract value.

How does the geographic location of the awardee (Louisiana) influence the logistics and cost of this procurement?

The awardee, Supreme Rice, LLC, is located in Louisiana, a major rice-producing state. This proximity to production and potentially to milling facilities can offer logistical advantages, potentially reducing transportation costs from farm to processor and from processor to distribution points. For a large-scale procurement like this, having the supplier based in a key agricultural region can streamline the supply chain. However, the final delivery locations for the donated commodities would also significantly impact overall logistics costs. If distribution points are distant from Louisiana, transportation expenses could still be substantial.

Industry Classification

NAICS: Manufacturing › Grain and Oilseed Milling › Rice Milling

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: 123J1423B0509

Offers Received: 8

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: $14,166,815

Exercised Options: $14,166,815

Current Obligation: $14,166,815

Actual Outlays: $14,166,815

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline