Agriculture contract for vegetable oil valued at $3.14M, awarded to INCOBRASA INDUSTRIES LTD

Contract Overview

Contract Amount: $3,141,173 ($3.1M)

Contractor: Incobrasa Industries Ltd

Awarding Agency: Department of Agriculture

Start Date: 2025-08-04

End Date: 2025-12-31

Contract Duration: 149 days

Daily Burn Rate: $21.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000010903/4100032665/OIL VEGETABLE BTL-9/48 OZ,OIL VEGETABLE BTL-6/1 GAL

Place of Performance

Location: GILMAN, IROQUOIS County, ILLINOIS, 60938

State: Illinois Government Spending

Plain-Language Summary

Department of Agriculture obligated $3.1 million to INCOBRASA INDUSTRIES LTD for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000010903/4100032665/OIL VEGETABLE BTL-9/48 OZ,OIL VEGETABLE BTL-6/1 GAL Key points: 1. The contract's firm fixed price structure aims to control costs for the government. 2. Competition dynamics appear robust with 3 bidders, suggesting potential for competitive pricing. 3. The contract duration of 149 days is relatively short, indicating a focused need. 4. This award falls within the broader category of food commodities for government use. 5. The supplier, INCOBRASA INDUSTRIES LTD, is a new awardee for this specific commodity. 6. Geographic delivery is specified for Illinois, impacting regional logistics.

Value Assessment

Rating: good

The contract value of $3.14 million for 20,000 cases of vegetable oil appears reasonable given the market for food commodities. Benchmarking against similar government food donation contracts would provide a more precise value-for-money assessment. The firm fixed price contract type helps mitigate cost overrun risks for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, with three bids received. This level of competition is generally positive, suggesting that multiple vendors had the opportunity to bid and that the government likely received competitive pricing. The presence of three bidders indicates a healthy market for this commodity.

Taxpayer Impact: Full and open competition ensures that taxpayer dollars are used efficiently by fostering a competitive environment that drives down prices.

Public Impact

Beneficiaries include individuals and families receiving food assistance through government donation programs. The service delivered is the provision of essential cooking oil, a staple food item. The geographic impact is concentrated in Illinois, where the commodity will be delivered. Workforce implications are minimal, primarily related to the logistics and distribution of the oil.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for supply chain disruptions impacting delivery timelines.
Fluctuations in global commodity prices could affect future contract costs if not locked in.
Ensuring consistent quality of vegetable oil across all delivered units.

Positive Signals

Award to a single supplier streamlines procurement and management.
Firm fixed price contract provides cost certainty.
Clear delivery location specified for efficient logistics.

Sector Analysis

This contract falls within the broader food manufacturing and distribution sector, specifically focusing on edible oils. The market for such commodities is global and subject to agricultural output, weather patterns, and international trade policies. Government procurement of food items, particularly for donation programs, represents a significant but specialized segment of this market.

Small Business Impact

There is no indication of a small business set-aside for this contract, nor are there explicit subcontracting requirements mentioned. The award to INCOBRASA INDUSTRIES LTD, a single entity, suggests that small businesses may not have been primary awardees or subcontractors on this specific procurement. Further analysis would be needed to determine if small businesses participated in the competitive bidding process.

Oversight & Accountability

Oversight for this contract will likely be managed by the Agricultural Marketing Service (AMS) within the Department of Agriculture. Standard contract administration procedures, including performance monitoring and quality checks, will be in place. Transparency is facilitated through public contract databases, though detailed operational oversight specifics are not provided.

Related Government Programs

USDA Food Purchase Programs
Commodity Supplemental Food Program
National School Lunch Program
Food Bank Network Support

Risk Flags

Potential for supply chain disruption
Quality control of delivered goods
Price volatility in commodity markets

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $3.1 million to INCOBRASA INDUSTRIES LTD. COMMODITIES FOR USG FOOD DONATIONS: 2000010903/4100032665/OIL VEGETABLE BTL-9/48 OZ,OIL VEGETABLE BTL-6/1 GAL

Who is the contractor on this award?

The obligated recipient is INCOBRASA INDUSTRIES LTD.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $3.1 million.

What is the period of performance?

Start: 2025-08-04. End: 2025-12-31.

What is the track record of INCOBRASA INDUSTRIES LTD with government contracts, particularly for food commodities?

Information regarding INCOBRASA INDUSTRIES LTD's prior government contract history is not detailed in the provided data. A comprehensive review would require accessing federal procurement databases to ascertain their performance on previous awards, including any related to food commodities or similar products. Understanding their past performance, including any issues or successes, is crucial for assessing reliability and potential risks associated with this new award. Without this historical data, it is difficult to definitively gauge their established track record within the federal procurement landscape.

How does the per-unit cost of this vegetable oil compare to market rates or similar government purchases?

The provided data does not include the specific per-unit cost or quantity breakdown (e.g., number of bottles or gallons per case) necessary for a direct per-unit cost comparison. To benchmark this contract's value, one would need to calculate the cost per unit (e.g., per bottle or per gallon) and compare it against prevailing market prices for similar vegetable oil products. Additionally, comparing this unit cost to historical government purchases of the same or comparable commodities would reveal whether this contract represents good value for money. The total award amount of $3.14 million for 20,000 cases suggests a price point that needs further granular analysis against market data.

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

Key risks include potential supply chain disruptions affecting timely delivery, quality control issues with the vegetable oil, and price volatility in the commodity market. Mitigation strategies appear to include the firm fixed price contract, which locks in the price and shifts some risk to the contractor, and the specified delivery location in Illinois, which defines logistical parameters. However, the short contract duration (149 days) might suggest a need for rapid fulfillment, increasing pressure on the supply chain. Further risk mitigation would involve robust quality assurance protocols and contingency planning for delivery delays.

How effective is the Agricultural Marketing Service (AMS) in managing contracts for food commodities like this vegetable oil?

The effectiveness of the AMS in managing food commodity contracts can be assessed through various indicators, such as on-time delivery rates, product quality compliance, and the overall value achieved for government programs. While this specific contract award suggests the AMS is actively procuring necessary goods, a broader analysis of their performance across numerous contracts would be required for a comprehensive effectiveness rating. Factors like the number of contract disputes, successful procurements versus cancellations, and feedback from program beneficiaries would contribute to such an assessment. The current data point alone does not provide sufficient information to evaluate the AMS's overall effectiveness in this area.

What are the historical spending patterns for vegetable oil procurement by the Department of Agriculture?

Historical spending data for vegetable oil procurement by the Department of Agriculture is not provided in this specific contract award notice. To analyze historical patterns, one would need to examine procurement records over several fiscal years, identifying the total amounts spent on vegetable oil, the primary vendors, contract types (e.g., fixed price, cost-plus), and the specific programs these purchases supported. Understanding these patterns would reveal trends in pricing, supplier reliance, and the overall scale of the government's demand for this commodity, providing context for the current $3.14 million award.

Industry Classification

NAICS: Manufacturing › Grain and Oilseed Milling › Fats and Oils Refining and Blending

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SEALED BID

Solicitation ID: 123J1425B0435

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 540 E US HIGHWAY 24, GILMAN, IL, 60938

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

Financial Breakdown

Contract Ceiling: $3,141,173

Exercised Options: $3,141,173

Current Obligation: $3,141,173

Actual Outlays: $3,141,173

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline