Treasury's $3.4M Gold Bullion Purchase from Asahi Refining USA Inc. Amidst Market Volatility
Contract Overview
Contract Amount: $3,418,619 ($3.4M)
Contractor: Asahi Refining USA Inc
Awarding Agency: Department of the Treasury
Start Date: 2026-01-20
End Date: 2026-02-06
Contract Duration: 17 days
Daily Burn Rate: $201.1K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: RAW GOLD BULLION MINT MAC GOLD BULLION
Place of Performance
Location: SALT LAKE CITY, SALT LAKE County, UTAH, 84120
State: Utah Government Spending
Plain-Language Summary
Department of the Treasury obligated $3.4 million to ASAHI REFINING USA INC for work described as: RAW GOLD BULLION MINT MAC GOLD BULLION Key points: 1. Significant expenditure on raw gold bullion highlights strategic asset management. 2. Competition was full and open, suggesting a potentially competitive price discovery process. 3. Risk associated with commodity price fluctuations and storage/security of precious metals. 4. Sector context is within nonferrous metals, with potential implications for broader commodity markets.
Value Assessment
Rating: fair
The contract value of $3.4M for raw gold bullion is difficult to assess without specific purity and quantity details. Benchmarking against market prices for similar gold bullion contracts is challenging due to the bespoke nature of such acquisitions.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Full and open competition was utilized, which theoretically allows for the best price discovery. However, the unique nature of raw gold bullion may limit the number of qualified bidders, potentially impacting the breadth of competition.
Taxpayer Impact: Taxpayer funds are utilized for this acquisition. The ultimate impact depends on the price paid relative to market value and the strategic purpose of holding gold reserves.
Public Impact
Public funds are being used to acquire a significant quantity of gold bullion. The purchase could influence market perceptions of government gold holdings. Transparency in the acquisition process and the rationale behind holding gold are key public interests.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Commodity price volatility risk
- Potential for limited qualified bidders despite open competition
- Storage and security costs for precious metals
Positive Signals
- Utilizes full and open competition
- Firm fixed price contract type
- Clear delivery dates
Sector Analysis
This contract falls under the nonferrous metal sector, specifically related to precious metals. Government acquisitions of gold can be benchmarked against global spot prices, but the premium for minting or specific forms can vary.
Small Business Impact
The data indicates the awardee is Asahi Refining USA Inc., a large corporation. There is no indication of small business participation in this specific contract award.
Oversight & Accountability
The United States Mint, an agency within the Department of the Treasury, is responsible for this acquisition. Oversight would involve standard procurement regulations and internal financial controls to ensure proper use of funds.
Related Government Programs
- Nonferrous Metal (except Copper and Aluminum) Rolling, Drawing, and Extruding
- Department of the Treasury Contracting
- United States Mint Programs
Risk Flags
- Market volatility of gold prices
- Potential for high storage and security costs
- Limited number of specialized suppliers for raw gold bullion
- Geopolitical risks impacting gold value
Tags
nonferrous-metal-except-copper-and-alumi, department-of-the-treasury, ut, delivery-order, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of the Treasury awarded $3.4 million to ASAHI REFINING USA INC. RAW GOLD BULLION MINT MAC GOLD BULLION
Who is the contractor on this award?
The obligated recipient is ASAHI REFINING USA INC.
Which agency awarded this contract?
Awarding agency: Department of the Treasury (United States Mint).
What is the total obligated amount?
The obligated amount is $3.4 million.
What is the period of performance?
Start: 2026-01-20. End: 2026-02-06.
What is the strategic rationale for the Treasury acquiring this specific quantity of gold bullion at this time?
The strategic rationale for acquiring gold bullion typically involves diversification of reserves, hedging against inflation or currency devaluation, and maintaining a store of value. The specific timing may be influenced by market conditions, geopolitical events, or a pre-determined reserve management strategy.
How does the contract price compare to prevailing market rates for raw gold bullion of similar quality?
A precise comparison is difficult without knowing the exact specifications (purity, form) of the 'raw gold bullion' purchased. However, the price paid would be benchmarked against the London Bullion Market Association (LBMA) spot price at the time of purchase, plus any applicable premiums for refining, assaying, or delivery.
What are the potential risks associated with the long-term storage and security of this gold bullion acquisition?
Long-term storage and security of gold involve significant costs for secure facilities, insurance, and personnel. Risks include potential theft, damage, or loss due to unforeseen events. The government must maintain robust protocols to mitigate these risks throughout the holding period.
Industry Classification
NAICS: Manufacturing › Nonferrous Metal (except Aluminum) Production and Processing › Nonferrous Metal (except Copper and Aluminum) Rolling, Drawing, and Extruding
Product/Service Code: ORES, MINERALS AND PRIMARY PRODUCTS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Asahi Holdings, Inc.
Address: 4601 W 2100 S, SALT LAKE CITY, UT, 84120
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Not Designated a Small Business, Special Designations
Financial Breakdown
Contract Ceiling: $3,418,619
Exercised Options: $3,418,619
Current Obligation: $3,418,619
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: 2031JG21D00006
IDV Type: IDC
Timeline
Start Date: 2026-01-20
Current End Date: 2026-02-06
Potential End Date: 2026-02-06 00:00:00
Last Modified: 2026-01-21
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