Cyberattack Hits Firm Producing 75% Of Cheese For U.S. Burgers
Beef burgers may have gotten more expensive in recent weeks, but the cheese on top may have actually gotten cheaper.
Photo Insert: While the price of beef went up, the hack caused that of the cheese on top to go down.
That's due in part to a cyberattack against one of the largest dairy processors in the US, Wisconsin-based Schreiber Foods, which had its operations interrupted by a "cyber event" on October 23, Dominick Reuter reported for Insider.
The alleged hackers reportedly demanded a $2.5 million ransom to unlock the computer systems that control the flow of milk and cheese through the company's facilities, according to the Wisconsin State Farmer.
A Schreiber Foods spokesperson confirmed to Insider that a cyber incident affected all of its locations, a "specialized response team" immediately got to work on the issue, and that the company had fully resumed production and shipping five days after the initial interruption.
Schreiber Foods produces a wide array of dairy products, including cheeses, yogurts, and sour cream, but reportedly maintains a roughly 75% market share for the sort of bulk yellow cheese that is commonly used to top sandwiches and hamburgers.
One indication of the company's reach is the commodity price of barrel cheese, the 500-pound units of intermediately processed cheese that are sold for further processing into slices, powders, sauces, and other products.
A dairy industry analyst said the five-day disruption at Schreiber led to such a backlog of barrel cheese that it is the likely cause of a price-drop that has reached as much as 20% in the weeks following the attack as the delayed product softened the market.
US Department of Agriculture data show the barrel cheese price tumbling from a 2021 peak of $1.85 for the week ending October 22 to $1.46 on Tuesday, Nov. 16, 2021.