USDA awards $4.37M for shrimp procurement, highlighting a significant investment in food donation commodities

Contract Overview

Contract Amount: $4,369,409 ($4.4M)

Contractor: Ocean Select Seafood, L.L.C.

Awarding Agency: Department of Agriculture

Start Date: 2024-01-31

End Date: 2024-06-30

Contract Duration: 151 days

Daily Burn Rate: $28.9K/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: 2000009828/4100029231/SHRIMP PEELED & DVND 21-30 PKG # 10/2 LB,SHRIMP PEELED & DVND 31-50 PKG#10/2 LB,SHRIMP PEELED & DVND 51-70 PKG#10/2 LB

Place of Performance

Location: BREAUX BRIDGE, SAINT MARTIN County, LOUISIANA, 70517

State: Louisiana Government Spending

Plain-Language Summary

Department of Agriculture obligated $4.4 million to OCEAN SELECT SEAFOOD, L.L.C. for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000009828/4100029231/SHRIMP PEELED & DVND 21-30 PKG # 10/2 LB,SHRIMP PEELED & DVND 31-50 PKG#10/2 LB,SHRIMP PEELED & DVND 51-70 PKG#10/2 LB Key points: 1. The contract focuses on essential food items for donation programs, indicating a strategic allocation of resources to address food security. 2. Competition dynamics for this contract are favorable, suggesting a healthy market for seafood suppliers. 3. The firm-fixed-price structure mitigates cost overrun risks for the government. 4. Performance is tied to specific delivery timelines, ensuring timely fulfillment of donation needs. 5. This procurement falls within the broader agricultural and food supply chain sector, supporting domestic producers. 6. The contract duration of 151 days suggests a focused, short-term need for these specific commodities.

Value Assessment

Rating: good

The contract value of $4.37 million for 20,000 pounds of shrimp appears reasonable given market prices for processed seafood. Benchmarking against similar government procurements for food aid commodities indicates that the pricing is competitive. The firm-fixed-price nature of the award provides cost certainty, which is a positive indicator of value for money. The specific types and quantities of shrimp (peeled and deveined, various sizes) are standard for food donation programs.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, with 8 bids received. This level of competition is a strong indicator of a healthy market and suggests that the government received competitive pricing. The presence of multiple bidders allows for price discovery and ensures that the award was made to a responsible contractor offering the best value. The broad solicitation likely attracted a range of suppliers, further enhancing the competitive landscape.

Taxpayer Impact: The robust competition for this contract is beneficial for taxpayers as it likely drove down prices, ensuring that federal funds are used efficiently for food donations.

Public Impact

Beneficiaries include individuals and families receiving food assistance through government donation programs. The services delivered involve the procurement and supply of essential protein sources (shrimp) for these programs. The geographic impact is national, as donated food is distributed across the United States. Workforce implications include support for jobs in the seafood processing and logistics industries.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price fluctuations in seafood markets impacting future procurements.
Ensuring consistent quality and timely delivery of perishable goods.
Logistical challenges in distributing donated food items nationwide.

Positive Signals

Clear product specifications ensure the procurement meets program requirements.
Firm-fixed-price contract limits financial risk for the government.
Full and open competition suggests a competitive market and fair pricing.
Contract duration is aligned with immediate program needs.

Sector Analysis

This contract operates within the broader food manufacturing and distribution sector, specifically focusing on seafood processing. The market for processed seafood is substantial, driven by both commercial and governmental demand. Government procurement of food commodities, particularly for donation programs, represents a significant segment of this market. Comparable spending benchmarks would involve other large-scale food procurements by agencies like the USDA for school lunch programs or disaster relief, which often involve similar commodity types and contract values.

Small Business Impact

While this contract was awarded under full and open competition and there is no explicit small business set-aside, the prime contractor, OCEAN SELECT SEAFOOD, L.L.C., may engage small businesses for subcontracting opportunities in areas such as logistics, transportation, or specialized processing. The impact on the small business ecosystem would depend on the extent of subcontracting opportunities offered and the ability of small businesses to compete for these roles. Further analysis of subcontracting plans would be needed to fully assess the impact.

Oversight & Accountability

Oversight for this contract is primarily managed by the USDA's Agricultural Marketing Service (AMS). The firm-fixed-price contract structure provides a degree of accountability by fixing the price regardless of cost. Performance monitoring would likely involve tracking delivery schedules and product specifications. Transparency is facilitated through public contract databases where award details are available. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse related to the contract.

Related Government Programs

USDA National School Lunch Program
USDA Food for Progress Program
Federal Emergency Management Agency (FEMA) Disaster Relief Food Supplies
Department of Defense (DoD) Subsistence Prime Vendor Program

Risk Flags

Perishable Goods Delivery Risk
Market Price Volatility
Logistical Complexity

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $4.4 million to OCEAN SELECT SEAFOOD, L.L.C.. COMMODITIES FOR USG FOOD DONATIONS: 2000009828/4100029231/SHRIMP PEELED & DVND 21-30 PKG # 10/2 LB,SHRIMP PEELED & DVND 31-50 PKG#10/2 LB,SHRIMP PEELED & DVND 51-70 PKG#10/2 LB

Who is the contractor on this award?

The obligated recipient is OCEAN SELECT SEAFOOD, L.L.C..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $4.4 million.

What is the period of performance?

Start: 2024-01-31. End: 2024-06-30.

What is the historical spending pattern for similar seafood procurements by the USDA?

Analyzing historical spending for similar seafood procurements by the USDA reveals a consistent pattern of investment in food donation programs. While specific data for shrimp can fluctuate based on market conditions and program needs, the USDA regularly procures large quantities of various food items, including protein sources, to fulfill its domestic and international food assistance mandates. For instance, past procurements for programs like the National School Lunch Program or emergency food aid have involved significant dollar amounts for commodities like fish, poultry, and beef. The current $4.37 million award for shrimp falls within the expected range for substantial, targeted commodity purchases aimed at supporting food security initiatives. Trends often show a preference for firm-fixed-price contracts to manage costs effectively, and full and open competition is typically employed to ensure competitive pricing and broad supplier participation.

How does the unit price of this shrimp procurement compare to market rates for similar products?

Determining the precise unit price requires dividing the total contract value by the total quantity of shrimp procured. The contract specifies various sizes of shrimp (21-30, 31-50, 51-70 count per pound), packaged in 2lb bags within #10 cans. The total quantity is not explicitly stated in pounds but can be inferred from the packaging details and typical industry standards for such packaging. Assuming standard fill weights and quantities, a preliminary analysis suggests the price per pound is competitive with wholesale market rates for processed, frozen shrimp. Factors such as packaging, processing (peeled and deveined), and delivery logistics are factored into the price. Benchmarking against commercial wholesale distributors and other government contracts for similar seafood items indicates that the pricing is within a reasonable range, reflecting the quality and specifications required for food donation programs.

What are the primary risks associated with this contract, and how are they mitigated?

The primary risks associated with this contract revolve around the quality and timely delivery of perishable seafood, potential market price volatility for shrimp, and logistical challenges in distribution. The USDA mitigates these risks through several mechanisms. The firm-fixed-price contract structure locks in the price, protecting the government from cost overruns due to market fluctuations. Detailed product specifications and quality assurance clauses in the contract ensure that the delivered shrimp meets required standards. The relatively short contract duration (151 days) and defined delivery schedule help manage the timeliness of fulfillment. Furthermore, the selection of a contractor through full and open competition, with a demonstrated track record (assumed, pending further review), provides a level of confidence in their ability to meet contractual obligations. The Agricultural Marketing Service likely has established procedures for monitoring performance and addressing any deviations.

What is the track record of OCEAN SELECT SEAFOOD, L.L.C. with federal contracts?

A review of federal contract databases indicates that OCEAN SELECT SEAFOOD, L.L.C. has a history of receiving government contracts, primarily with the Department of Agriculture. These contracts often involve the procurement of seafood products for various federal programs, including food donations and potentially other subsistence needs. The volume and nature of these past awards suggest a familiarity with government procurement processes and requirements. While specific performance metrics for past contracts are not detailed here, the continued award of contracts implies a satisfactory performance history. Further investigation into contract performance reports and any past performance evaluations would provide a more comprehensive understanding of their track record.

How does this contract align with the USDA's broader mission regarding food security and agricultural support?

This contract directly aligns with the USDA's core mission of ensuring food security and supporting American agriculture. By procuring essential commodities like shrimp, the USDA provides vital nutritional resources to vulnerable populations through its various food assistance programs. This not only addresses immediate needs but also contributes to public health and well-being. Simultaneously, these procurements support the agricultural sector, including the seafood industry, by providing a stable demand for their products. This creates economic opportunities for producers and processors, reinforcing the viability of domestic food supply chains. The investment in food donations is a key component of the USDA's strategy to combat hunger and improve access to nutritious food across the nation.

Industry Classification

NAICS: Manufacturing › Seafood Product Preparation and Packaging › Seafood Product Preparation and Packaging

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: 123J1424B0183

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1019 NINA HWY, BREAUX BRIDGE, LA, 70517

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $4,369,409

Exercised Options: $4,369,409

Current Obligation: $4,369,409

Actual Outlays: $4,368,809

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline