13.3 C
Munich
Tuesday, June 15, 2021

Meat Producer JBS Curtails Operations After Cyberattack

Must read

What’s new in Apple’s iOS 15 for iPhones, Tech News News & Top Stories

SINGAPORE (HARDWAREZONE) - At Apple's annual worldwide developer conference (WWDC) last week, the iPhone maker started the online event with a banger - the...

News Wrap: Israel's Naftali Bennett officially unseats Benjamin Netanyahu

In our news wrap Monday, new Israeli Prime Minister Naftali Bennett formally took office, ending Benjamin Netanyahu's 12-year rule. The U.S. neared 600,000 deaths...

3 issues that will test US partnerships with EU allies

President Joe Biden will meet European Union leaders in Brussels, Belgium Tuesday. After the fractious relationship between former President Trump and many of those...

JBS SA

JBSAY 3.52%

said it was struck by a cyberattack, disrupting operations for the world’s biggest meatpacker across the U.S. and in Australia.

Brazil-based JBS said that after identifying the incursion on Sunday, it suspended affected systems and was working to get operations back online. The company is the largest beef processor and a top pork supplier in the U.S.

JBS told the Biden administration that it was the victim of a ransomware attack, White House principal deputy press secretary Karine Jean-Pierre said Tuesday. She said JBS reported that the attack originated from a criminal group 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,” Ms. Jean-Pierre said.

JBS had no immediate comment on the White House’s description of the attack.

Some of the biggest U.S. meat-processing plants halted processing operations after the attack, according to worker representatives and notices shared with JBS employees, including JBS facilities in Colorado, Iowa, Minnesota, Pennsylvania and Texas. Representatives for JBS had no further comment on plant operations.

The attack on JBS, which sold $52.4 billion of meat and other products globally in 2020, is the latest cyberattack to demonstrate the rising and potentially costly risk to corporate operations posed by such incursions.

Such attacks can affect daily life in the U.S. A cyberattack on Colonial Pipeline Co. last month shut down the fuel supplier’s main fuel conduit for the U.S. East Coast, prompting a run on regional gas stations and pushing gasoline prices to their highest levels in 6 1/2 years. Since the Colonial attack, lawmakers have warned that criminal ransomware gangs are increasingly targeting U.S. infrastructure and businesses, snarling day-to-day operations.

For JBS, which processes nearly a quarter of U.S. beef and about one-fifth of pork, the attack illustrates a new threat for an industry that was among the hardest hit by Covid-19. As the pandemic arrived in the U.S., tens of thousands of plant workers were infected, according to labor union estimates, forcing a wave of shutdowns over the spring of 2020 that backed up livestock on farms. Meatpackers spent hundreds of millions of dollars to temporarily boost wages, install automated temperature scanners and place partitions between processing-line stations.

A cyberattack on the U.S.’s largest fuel pipeline on May 7 forced a shutdown that triggered a spike in gas prices and shortages in parts of the Southeast. WSJ explains just how vulnerable the nation’s critical energy infrastructure is to attack. Photo illustration: Liz Ornitz/WSJ

JBS said that the cyberattack didn’t affect its backup servers, and that the company was working with technology specialists to restore its systems. As of Monday, JBS said that there was no sign that customer, supplier or employee data was compromised. It said the attack could delay business with meat buyers, cattle feedlots and other suppliers.

At a JBS beef plant in Souderton, Pa., which the company estimates is the largest beef plant east of Chicago, workers were told no slaughtering or processing would take place Tuesday, according to Wendell Young, president of the local United Food and Commercial Workers International Union, which represents JBS plant employees.

“The goal is to reopen tomorrow, but until they notify us later today, we don’t know about that,” Mr. Young said.

In Greeley, Colo., where JBS runs another major beef-packing plant, shifts were canceled due to the cyberattack, a spokeswoman for the local UFCW chapter said. The company’s Cactus, Texas, beef plant also canceled Tuesday operations with the exception of maintenance and some other functions, according to a notice posted to the plant’s

Facebook

page.

JBS’ pork plant in Ottumwa, Iowa, told employees that Tuesday’s slaughtering and bacon-slicing shifts were suspended, according to a separate Facebook notice. In Worthington, Minn., where JBS runs another pork plant, cutting, trimming and deboning shifts were suspended Tuesday, according to a notice posted to that plant’s Facebook page.


‘Even one day of disruption will significantly impact the beef market and wholesale beef prices.’


— Steiner Consulting Group analysts

Plants across the Midwest and South run by

Pilgrim’s Pride Corp.

, the U.S. chicken processor majority-owned by JBS, also suspended processing shifts late Monday and Tuesday, according to notices shared with employees on social media.

Meat-market analysts said the plant closures could soon lead to higher consumer prices, which have climbed for many cuts this year due to high demand and a tight labor market. “Even one day of disruption will significantly impact the beef market and wholesale beef prices,” wrote analysts for Steiner Consulting Group, which researches the meat industry.

Live cattle futures trading on the Chicago Mercantile Exchange fell on Tuesday, with the most-active cattle contract down 1.8% midday at just above $1.16 a pound. The primary factor weighing on the contract was the hack, livestock traders said, by raising the risk that some plants would be unable to purchase livestock.

JBS said the attack targeted some of its information technology and that the company has since suspended the use of affected servers. While attacks on IT systems can wreak havoc, cybersecurity experts have said hackers can cause even greater damage if they reach operational technology used to keep factories or other industrial facilities running.

A JBS spokeswoman didn’t immediately respond to a request for comment on whether the attack affected the company’s operational-technology systems.

Suzanne Rajczi, chief executive of New York-based restaurant supplier Ginsberg’s Foods, said she was looking for a new source for chicken she usually buys from a Pilgrim’s plant in West Virginia that was affected by the cyberattack.

Pilgrim’s canceled a fresh chicken delivery to Ginsberg’s on Tuesday, Ms. Rajczi said. She said Pilgrim’s said it couldn’t process invoices and didn’t know when Ginsberg’s would receive its delivery.

“There’s a lot of frenzied buying going on right now,” Ms. Rajczi said.

Write to Jacob Bunge at jacob.bunge@wsj.com

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

More articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest article

What’s new in Apple’s iOS 15 for iPhones, Tech News News & Top Stories

SINGAPORE (HARDWAREZONE) - At Apple's annual worldwide developer conference (WWDC) last week, the iPhone maker started the online event with a banger - the...

News Wrap: Israel's Naftali Bennett officially unseats Benjamin Netanyahu

In our news wrap Monday, new Israeli Prime Minister Naftali Bennett formally took office, ending Benjamin Netanyahu's 12-year rule. The U.S. neared 600,000 deaths...

3 issues that will test US partnerships with EU allies

President Joe Biden will meet European Union leaders in Brussels, Belgium Tuesday. After the fractious relationship between former President Trump and many of those...