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Economist says cyberattack will create additional volatility to the market

An ag economist says the unknowns from the cyberattack on JBS, the world’s largest meatpacker, will create even more volatility in the cattle markets.

Oklahoma State’s Derrell Peel says it’s a “wait and see” situation.  “The size of JBS in all of these markets is big enough, if there is a significant issue it will impact the markets,” he says.  “It’s not to say that those impacts are there for sure at this point.  There’s a lot of uncertainty and the markets will likely reacting to a ‘worst case scenario’ at this point.”

He tells Brownfield there is a possibility this could disrupt supply chains, causing product shortages.  “All of these meats are a perishable product,” he says. “They depend on a consistent flow of products through the system.  It’s certainly possible that we could see a disruption that would show up all the way up to the consumer level.  But, it’s not a for sure thing or even a high probability thing at this point.”

Several beef, pork, and poultry processors were shut down on Tuesday as a result of the ransomware attack. 

White House spokesperson Karine Jean-Pierre said JBS has notified the administration that the ransom demand came from a criminal organization likely based in Russia. 

Cattle futures ended the day mixed on Tuesday while hog futures were higher.

JBS accounts for about 20 percent of slaughter capacity in the US for cattle and hogs.

AUDIO: Derrell Peel, Oklahoma State