Ransomware attack with suspected Russian ties downs operations at JBS plants
Today, Brazil’s JBS SA informed the White House a ransomware attack against the company has disrupted meat production in North America and Australia. The company says the attack likely originated from a criminal organization that’s based in Russia. The attack has shut down JBS’s operations in Australia and stopped livestock slaughter at plants in several U.S. states. The company says its backup servers were not affected.
JBS is the world’s largest meatpacker and it controls around 25% of all U.S. beef capacity and roughly 20% of its hog slaughter capacity. Estimated cattle slaughter today at 94,000 head was down 27,000 head (22.3%) from week ago, while hog processing dropped 95,000 head (19.6%) from last Monday.
White House spokeswoman Karine Jean-Pierre said the U.S. has contacted Russia's government about the matter and the FBI is investigating. This comes soon after a criminal group with Russian ties attacked Colonial Pipeline last month.
The situation underscores the fragility of our food supply system and reignites debate about consolidation in the processing sector. Four companies control 80% of U.S. beef processing. The attack is particularly ill-timed for consumers and producers. It comes at a time when beef prices are at record levels, adding to concerns about inflation and padding packer profit margins. Meanwhile, an increasing number of feedlots are struggling to make ends meet with feed costs rising and an abundance of market-ready supplies and limited work force stagnating cash prices.
Lawmakers are slated to hold hearings on industry consolidation later this month, though ranchers worry concrete solutions could prove elusive.