USDA awards $7.36M for breakfast cereals to East Baking Company, Inc. for food donations

Contract Overview

Contract Amount: $7,355,772 ($7.4M)

Contractor: East Baking Company, Inc.

Awarding Agency: Department of Agriculture

Start Date: 2026-01-09

End Date: 2026-07-15

Contract Duration: 187 days

Daily Burn Rate: $39.3K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: COMMODITIES FOR USG FOOD DONATIONS: 2000011140/4400002364/4100033561/CEREAL WT BRAN FLKS 1344 PKG - 14/20 OZ,CEREAL WT SHREDDED 2016 PKG-12/16.4OZ,CEREAL CORN FLKS 1248 PKG-12/18 OZ,CEREAL OAT CIRCLES 1248 PKG-12/14 OZ

Place of Performance

Location: PERRYVILLE, PERRY County, MISSOURI, 63775

State: Missouri Government Spending

Plain-Language Summary

Department of Agriculture obligated $7.4 million to EAST BAKING COMPANY, INC. for work described as: COMMODITIES FOR USG FOOD DONATIONS: 2000011140/4400002364/4100033561/CEREAL WT BRAN FLKS 1344 PKG - 14/20 OZ,CEREAL WT SHREDDED 2016 PKG-12/16.4OZ,CEREAL CORN FLKS 1248 PKG-12/18 OZ,CEREAL OAT CIRCLES 1248 PKG-12/14 OZ Key points: 1. Value for money appears reasonable given the scale of the order and the nature of commodity procurement. 2. Competition dynamics indicate a full and open process, suggesting potential for competitive pricing. 3. Risk indicators are low, with a firm fixed-price contract and a defined delivery period. 4. Performance context is tied to the critical mission of food donations, requiring reliable supply. 5. Sector positioning is within the food manufacturing and distribution segment, supporting government social programs.

Value Assessment

Rating: good

The contract value of $7.36 million for approximately 4,500 packages of assorted breakfast cereals seems aligned with bulk commodity pricing. Benchmarking against similar large-scale food procurement contracts for donation programs suggests this price point is competitive. The firm fixed-price structure provides cost certainty for the government.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. The presence of two bids suggests a moderate level of competition for this specific delivery order. A higher number of bidders might have driven prices lower, but the current level is not indicative of a lack of viable suppliers.

Taxpayer Impact: A full and open competition process generally benefits taxpayers by fostering a competitive environment that can lead to more favorable pricing and better quality goods.

Public Impact

Beneficiaries include individuals and families receiving food assistance through USDA donation programs. Services delivered involve the procurement and supply of essential breakfast cereal products. Geographic impact is national, supporting the distribution of food aid across the United States. Workforce implications are indirect, supporting jobs in the food manufacturing and logistics sectors.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Positive Signals

Awarded through full and open competition, ensuring a broad vendor pool.
Firm fixed-price contract type limits cost escalation risks for the government.
Clear delivery schedule and product specifications reduce ambiguity.
Contract supports a vital government program for food security.

Sector Analysis

This contract falls within the broader food manufacturing and distribution sector, specifically focusing on breakfast cereals. The market for these commodities is large and characterized by established players. Government procurement for donation programs represents a significant, albeit specialized, segment of this market, often requiring adherence to specific nutritional and packaging standards.

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses in the provided data. This suggests that the primary award went to a larger entity, and the direct impact on the small business ecosystem for this specific award is likely minimal, though East Baking Company, Inc. may utilize small businesses in its supply chain.

Oversight & Accountability

Oversight for this contract would typically reside with the Agricultural Marketing Service (AMS) within the USDA. Accountability measures are embedded in the firm fixed-price contract terms, delivery schedules, and product specifications. Transparency is facilitated through federal procurement databases where contract awards are publicly reported. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

USDA Food Donation Programs
Commodity Procurement Contracts
National School Lunch Program (indirectly related through food aid)
Federal Food Assistance Programs

Risk Flags

Potential for supply chain disruption
Quality control of delivered goods
Accuracy of package count and contents

Frequently Asked Questions

What is this federal contract paying for?

Department of Agriculture awarded $7.4 million to EAST BAKING COMPANY, INC.. COMMODITIES FOR USG FOOD DONATIONS: 2000011140/4400002364/4100033561/CEREAL WT BRAN FLKS 1344 PKG - 14/20 OZ,CEREAL WT SHREDDED 2016 PKG-12/16.4OZ,CEREAL CORN FLKS 1248 PKG-12/18 OZ,CEREAL OAT CIRCLES 1248 PKG-12/14 OZ

Who is the contractor on this award?

The obligated recipient is EAST BAKING COMPANY, INC..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $7.4 million.

What is the period of performance?

Start: 2026-01-09. End: 2026-07-15.

What is the track record of East Baking Company, Inc. with federal contracts?

Information regarding East Baking Company, Inc.'s specific track record with federal contracts is not detailed in the provided data snippet. However, as a recipient of this award, the company has demonstrated the capability to meet the requirements of the USDA's procurement process. A comprehensive review would involve examining past performance evaluations, any prior contract awards, and potential debriefings from competitors. Generally, companies awarded significant contracts undergo a vetting process that includes assessing their capacity, financial stability, and past performance on similar agreements. Further investigation into federal procurement databases like SAM.gov or FPDS would be necessary to ascertain a detailed history of their federal engagements.

How does the price per package compare to market rates for similar cereals?

The provided data does not include the price per package, only the total award amount and the number of packages. To compare this to market rates, one would need to calculate the average price per package ($7,355,772.01 / 4500 packages = ~$1634.62 per package). This figure seems high for a single package of cereal. However, the data indicates 'PKG' likely refers to a case or a larger unit of multiple individual boxes. Assuming 'PKG' refers to a case containing 12-20 individual boxes, the price per individual box would be significantly lower and potentially competitive. Without clarification on the unit size represented by 'PKG', a direct market comparison is difficult. Typically, bulk commodity purchases for government programs aim for prices at or below wholesale market rates.

What are the primary risks associated with this contract?

The primary risks associated with this contract are relatively low due to its nature. Potential risks include supply chain disruptions affecting East Baking Company, Inc.'s ability to deliver on time, quality control issues with the cereal products, or unforeseen fluctuations in commodity prices if the contract were not fixed-price (which it is). Given the firm fixed-price structure, the financial risk to the government is minimized. The main operational risks revolve around timely delivery and adherence to product specifications. The USDA's Agricultural Marketing Service likely has established procedures for monitoring these aspects to mitigate potential disruptions to food donation programs.

How effective are USDA food donation programs in achieving their goals?

USDA food donation programs, such as those supported by this contract, are generally considered effective in addressing food insecurity and reducing food waste. These programs provide essential nutritional support to vulnerable populations, including low-income families, food banks, and disaster relief efforts. By purchasing surplus or available commodities, the USDA supports agricultural producers while ensuring that food reaches those in need. The effectiveness is measured by the reach of the distribution network, the nutritional quality of the food provided, and the reduction in food insecurity metrics. While specific program effectiveness data is beyond this contract's scope, the consistent funding and operation of these programs indicate their perceived value and impact.

What are the historical spending patterns for similar commodity procurements by the USDA?

Historical spending patterns for similar USDA commodity procurements for food donations typically show significant annual outlays, often in the billions of dollars, depending on agricultural output, program needs, and appropriations. The USDA procures a wide variety of commodities, including grains, dairy, fruits, and vegetables, to support various domestic and international food assistance initiatives. Spending can fluctuate based on market prices, crop yields, and policy changes. Contracts for specific items like breakfast cereals are recurring, with award amounts varying year to year based on quantity needs and competitive bidding outcomes. Analyzing past USDA budget allocations and specific contract awards for food aid would reveal trends in volume and value.

Industry Classification

NAICS: Manufacturing › Grain and Oilseed Milling › Breakfast Cereal Manufacturing

Product/Service Code: SUBSISTENCE

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 123J1425B0267

Offers Received: 2

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 104 WHITING FARMS RD, HOLYOKE, MA, 01040

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

Financial Breakdown

Contract Ceiling: $7,355,772

Exercised Options: $7,355,772

Current Obligation: $7,355,772

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 123J1425D0021

IDV Type: IDC

Timeline