Cream cheese shortage: Supply chain problem has reached bagels, cheesecakes

For the first time in its 71 year history, the production line for Junior's Cheesecake sputtered and came to a halt on Friday, Dec. 3.

The company's baking facility stayed closed Saturday before reopening the next day. But production at the New Jersey-based facility came to stop again Thursday. 

The culprit? Not enough cream cheese. 

"Cream cheese is our No. 1 ingredient. It's in 85% of what we do" said Junior's Cheesecake third-generation owner, Alan Rosen. 

Rosen's company gets its yearly 4 million pounds of cream cheese from Philadelphia Cream Cheese. Between supplying cheesecakes for its mail-order business, its restaurants and around 8,000 supermarkets across the country, Junior's Cheesecakes uses around 40,000 pounds of cream cheese in a day and a half, according to Rosen. 

The issue began two weeks ago when orders of cream cheese didn't show up.

It couldn't come at a worse time since November and December are the busiest months of the year for the company, Rosen said. 

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And it could be some time before things return to normal for Junior's Cheesecake. Rosen said Kraft Heinz, the company that owns Philadelphia Cream Cheese, told him the "intermittent supply issue" could take up to the three months to level off. Despite this, Rosen said they won't be switching brands. 

"We don't switch brands," he said. "It's the cream cheese we've always used to make our cheesecakes, and we're very loyal. We're going to work through it together."

It's not just partners like Junior's Cheesecake increasing demand. A spokesperson for Kraft Heinz said the company is "maximizing our production to meet unprecedented demand." 

"We’re shipping 30-35% more product to foodservice partners vs. a year ago," the spokesperson said in an email to USA TODAY. And at home consumption, which has remained 18% higher than 2019 levels, is adding to demand, according to the statement. 

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In New York City, bagel shops are struggling with their own cream cheese shortage, according to reporting from the New York Times. 

So how did we get here? A cyberattack, strangely enough. 

Schreiber Foods, a large producer of dairy products including cream cheese, had to close down for a number of days in October after operations were halted at its plants and distribution centers due to a "cyber event." 

But even a few days down was enough to cause "shockwaves" in the supply chains, said Mark Stephenson, the director of Dairy Policy Analysis at the University of Wisconsin. 

"Dairy plants, for fresh products like that, don't stockpile a lot of inventory. So we can't draw on that to smooth out a hiccup of a plant going down for several days time," Stephenson said. 

There are other things contributing to the shortage too, said Andrew Tobisch, a spokesperson for Schreiber Foods.

"Every cream cheese provider has struggled to keep up with demand," Tobisch said in an email to USA TODAY. "While that demand has been steady, it’s really world events that are the biggest driver. Things like the pandemic, labor shortages and supply chain disruptions are all hurdles that everyone is having to overcome."