Meat Industry Latest Hit in String Of Cyberattacks – Will Beef Prices Go Up?

Japanese man slicing meat.
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JBS SA was forced to close all of its U.S. beef plants and facilities after ransomware attack this past weekend. The global meat producer supplies almost 25% of American beef.

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All of JBS’ facilities experienced some disruption according to Bloomberg, and took its biggest beef and pork processing operations offline, sending buyers scrambling and increasing the pressure on already tight supply chain.

White House principal deputy press secretary Karine Jean-Pierre said JBS reported that the attack originated from a criminal group likely based in Russia.

“JBS notified the administration that the ransom demand came from a criminal organization likely based in Russia. The White House is engaging directly with the Russian government on this matter and delivering the message that responsible states do not harbor ransomware criminals,” reads her statement.

According to The Wall Street Journal, meat-market analysts have said plant closures resulting from the JBS cyberattack could quickly lead to higher consumer prices. Steiner Consulting Group analysts wrote that “even one day of disruption will significantly impact the beef market and wholesale beef prices.”

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This attack is the latest in a string of recent cyber affronts against big industry in the U.S. Just three weeks ago, the Colonial Pipeline Co, operator of the largest U.S. gasoline pipeline was also targeted in a ransomware attack linked to groups in Russia, Bloomberg Law stated. This was followed by further attacks against government agencies, health facilities and businesses that Bloomberg adds were “also often blamed on Russia or Russia-based hackers at a fraught time in relations between the two countries.”

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NPR reports that unless the suspensions of JBS’ five largest plants continues for more than a week, consumers should not expect to pay more money for their meat, meaning an immediate effect on overall consumer prices is not expected.

Despite this, the closure of the JBS plants was impactful enough that the U.S. government was prevented from releasing key meat-pricing data that agricultural markets daily rely on.

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“We’re assessing any impacts on supply, and the President has directed the administration to determine what we can do to mitigate any impacts as they may become necessary,” Jean-Pierre said.

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About the Author

Georgina Tzanetos is a former financial advisor who studied post-industrial capitalist structures at New York University. She has eight years of experience with concentrations in asset management, portfolio management, private client banking, and investment research. Georgina has written for Investopedia and WallStreetMojo. 
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