If you’ve heard the rumblings about a beef shortage due to supply chain issues or something related to a cyberattack, here’s what you need to know.
No, this isn’t related to the meat and supply shortages that plagued the country at the beginning of the pandemic, nor supply constraints in goods leading to increased prices as the economy opens up — there are actually some new problems related to a cyberattack.
According to Bloomberg, meatpacking company JBS, responsible for one-fifth of the beef supply in the U.S., is the victim of a cyberattack that shut down some of the largest slaughterhouses in the world.
“All of the company’s fed-beef and regional beef plants were forced to shutter, and all other JBS meatpacking facilities in the country experienced some level of disruption to operations,” the publication reports. JBS owns facilities in 20 different countries, and the U.S accounts for half of the overall revenue.
So, what does that mean for you? Should we be stocking up our freezers with ground beef and steak? Here’s what you need to know.
Is there a beef shortage? How widespread is it?
The short answer: Yes, there’s likely going to be a shortage. But we don’t know how big it’ll be. At this time, it’s not known how many JBS plants were impacted globally by the ransomware attack, which is thought to have originated from a criminal organization likely based in Russia. However, the company had to suspend its computer systems in North America and Australia after the attack on the company’s servers.
At that time, the company did note that the incident “may delay certain transactions with customers and suppliers.” So, the company isn’t sure how much this will impact the beef food chain for companies and the average American. But it will likely have some impact since even one day of disruption can impact the market and wholesale prices.
“Retailers and beef processors are coming from a long weekend and need to catch up with orders,” Steiner Consulting Group said in its Daily Livestock Report, according to Bloomberg. “If they suddenly get a call saying that product may not deliver tomorrow or this week, it will create very significant challenges in keeping plants in operation, and the retail case stocked up.”
Will the shortage cause a price increase for beef?
The short answer for this one is no one really knows yet, and that will depend on how long the plant shutdown is or if it were to happen again. The impact on beef prices in the grocery stores across the country won’t be apparent right away.
“How long it goes on will impact to what level consumers start to see something at the grocery stores,” Michael Nepveux, an economist with the American Farm Bureau Federation, said to Bloomberg in a phone interview.
Hopefully, the company can get back to full operation soon across all plants. According to White House Deputy Press Secretary Karine Jean-Pierre, the White House has offered assistance to look into the cyberattack.
Just a few weeks ago, there was a gas shortage in the U.S., related to a cyberattack on the Colonial Pipeline, which delivers about 45 percent of the fuel used along the Eastern Seaboard. At that time, the government was urging people not to panic and hoard gasoline.
The bottom line is that it won’t do any good to panic and buy out the local grocery store’s beef stock.