Meatpacking Giant JBS Believes Russia Behind Cyber Attack; Price Hike, Shortages in Beef Feared

A cyberattack linked to Russia on the world's largest beef manufacturer may have impacted one-fifth of the US beef supply, the report says. JBS received a ransom demand from a criminal group presumably located in Russia, said the White House.

The country's food security attack comes less than four weeks after the Colonial Pipeline was hacked, causing energy security worries. According to Bloomberg, the cyberattack on the Brazil-based meat company's computer networks might significantly impact.

Meat producers were affected with JBS cyberattack blamed on Russia

According to the outlet, the five US businesses process a total of 22,500 cattle every day, and the weekend attack essentially knocked off about a quarter of the national product, according to the outlet, with operations also reported down in Australia and Canada. Colonial Pipeline paid a $5 million ransom to Russian hackers DarkSide in the hopes of restoring their network.

While Ann Neuberger, the deputy national security adviser for cyber and emerging technologies, acknowledged that paying a ransom was usually a "private-sector choice." Paying the Colonial Pipeline hackers led to concern that further ransom attempts on the country's critical infrastructure might follow. Karine Jean-Pierre, the White House deputy press secretary, informed reporters that the Biden administration has offered JBS support and contacted the Russian government.

She stated that the US Department of Agriculture was in contact with meat processors around the country to ensure that they were aware of the problem. "We're analyzing potential supply consequences. The president has directed the administration to consider what we can do to alleviate any supply implications as they become required," Jean-Pierre said.

JBS cyberattack comes weeks after the Colonial Pipeline hack

The US main gas pipeline was shut down, causing panic purchasing and gas supply shortages until the systems were restored and oil resumed flowing again.

Trading CME cattle futures dropped more than 3% after JBS announced the new ransom attack in a statement on Monday but recovered marginally as the market waited to discover the full extent of the worldwide production shutdowns. According to Bloomberg, JBS has 23% beef capacity in the United States, ahead of Tyson Foods' 22%, and around 20% of pork capacity.

They alleged that the business shut down processing or canceled shifts in Colorado, Nebraska, Iowa, Utah, Texas, and Wisconsin. Minnesota pork and chicken plants were also shuttered, according to union leaders and employees.

"I know of at least ten plants that have had their operations halted as a result of the cyberattack," said Paula Schelling-Soldner, acting chairperson of the American Federation of Government Employees' national council of locals representing food inspectors, The Independent reported.

After being alerted of the ransomware assault by JBS, the White House thinks it was carried out by a group of Russian cybercriminals and has personally challenged the Russian government over the issue. If the problem is not resolved fast, customers should anticipate meat prices to climb significantly more than they did last year when the COVID-19 outbreak caused a spike.

On Tuesday, the United States Department of Agriculture (USDA) projected that 94,000 cattle were slaughtered, down 22% from a week earlier and 18% from the same period in 2020. Choice beef cuts supplied to wholesalers rose $3.59 to $334.56 per 100 pounds, increasing less than 1%. Select cuts increase in price significantly, from $5.55 to $306.45 per 100 pounds. On Tuesday, pork supplies were also disrupted, with 390,000 hogs slaughtered, a 20% decrease from a week earlier.

JBS USA CEO Andre Nogueira claims the vast majority of the company's beef, pork, and poultry operations should be operating by Wednesday. She noted that "progress our IT specialists and plant teams have achieved in the previous 24 hours," Newsweek via MSN reported. JBS had alerted the Biden administration of the ransomware cyberattack on Sunday, Principal Deputy White House Press Secretary Karine Jean-Pierre told reporters aboard Air Force One on Tuesday. She claimed White House and USDA officials had spoken with the corporation several times in the last day. The administration was also engaging the Russian government directly about the situation.