It is important to use freshly grated cheddar cheese, Not pre-shredded. I doubled the recipe below so I could have some leftovers.
1 shallot, grated
8 oz. block sharp cheddar cheese, grated
1/2 c. mayonnaise
1/2 of 1-oz. jar pimentos
salt and black pepper
Mix grated shallot and grated cheese. Add mayo and stir with a fork until combined. Stir in pimentos and some of the liquid. Season with salt and black pepper. Cover and refrigerate until ready to use. Keep refrigerated up to a week.