Sterling Ranches’ Focus Is On Quality Beef And Stewardship

BEEF QUALITY is a focus for cattleman Jimmy Sterling, who has a far-flung cow-calf operation in several West Texas counties. Sterling began concentrating on beef quality in the 1980s, long before the market provided any reward for the effort.

Article Courtesy of Livestock Weekly, San Angelo
By Colleen Schreiber
 
     COAHOMA — When it comes to raising cattle, Jimmy Sterling is interested in the big picture. He wants reproductively efficient cows that are adapted to his country and year in and year out raise a calf that converts well in the feedyard. He’s just as interested — perhaps more so — in the carcass and the beef that goes on consumers’ tables.
     “I realized a long time ago that I didn’t want to be just another cow-calf operator. I wanted to raise quality beef,” says the 63 year-old Sterling.
     The problem was that when he came to this conclusion back in the 1980s there was essentially zero reward for raising quality. Undaunted, he started down that path and never wavered. Today that persistence is paying off in a big way.
     Sterling grew up in Howard County. His dad was raised on a cotton farm in Scurry County. In 1954, after he got out of the Service, the elder Sterling bought the ranch that Jimmy now owns and operates. Jimmy grew up here with his four siblings, and then he went off to Angelo State University, where he obtained a business degree.
     “My dad told me to get a business degree and he’d teach me how to ranch,” Sterling says of his late father.
     So that’s what he did.
     “My uncle tried to get me to work for him. He told me I could be making $50,000 within two years working at his stock brokerage firm. Instead, I came back to the ranch and made $4000 the first year. I remember asking myself if I had made the right decision,” admits Sterling.
     He returned to the ranch in 1973, just after the big crash.
     “I was just out of college, so I knew everything, and I didn’t know a dadgum thing.”
     During those formative years, he did whatever it took to make a living, which early on included cotton farming as well. By 1991 he had leased enough country that he could quit farming, which pleased him because he never had a farmer’s passion.
     Today Sterling operates nine ranches encompassing 215,000 acres in eight counties stretching from Coleman to Andrews. The ranch at Coahoma is deeded; the remainder is lease country, two-thirds of which includes two University Lands leases in Andrews County. The majority of his private leases, like the Chadbourne Ranch north of San Angelo, he’s had for 20-plus years.
     Though strictly a commercial operator, Sterling is a numbers guy and has long been a collector of data. He uses that data to improve the performance of his cattle. An Angus man through and through, Sterling has stuck with Angus all these years, in part because it was the first breed that really began to focus on EPDs to identify low birthweight bulls, and the breed was the first to have any real predictability in terms of carcass traits.
     “I like red, personally, but the blacks just bring more money,” he quips.
     He’s always been a calculated risk taker, but someone who thinks out of the box. Sterling has participated in a number of branded beef programs, from Ranchers’ Renaissance to Country Natural Beef.
     Today Sterling markets some of his “natural” cattle, no implants and no antibiotics ever, through National Beef’s NatureSource® program. His ranch and the feedlot where he feeds his cattle have been audited and approved to market through this program. Sometimes he feeds them; other times he sells yearlings, marketing them as “natural.” Given where the market is, he probably won’t feed any this year.
     “When I can sell calves for $2.50 a pound weighing 700 pounds, why take the risk? Its cash in hand,” says Sterling.
     A few years back, wanting to raise the bar still more on the carcass side and needing some hybrid vigor, he incorporated Akaushi genetics into the herd. Akaushi is a breed of Wagyu cattle. Wagyu is the term used for all indigenous Japanese cattle. The Akaushi, the Japanese Red, is a Bos Taurus. One hundred-plus years of carefully planned matings and selection have gone into the development of this breed. The genetics were never allowed outside of Japan until 1994, when a loophole in a trade agreement enabled a few cows and bulls to be shipped to Texas.
     Akaushi cattle grade 100 percent prime. Sterling’s cattle are halfbloods, and the calves from that first cross, he says, grade 30 to 40 percent prime. The real beauty of the cross, though, is that it is well adapted to the kind of country Sterling operates. Not to mention, he insists, that their longevity is better, their fertility is good, and they’re easy calving.
     Another selling point is that they marble well, and better yet, the beef has more of the “good” kind of fat and is high in Omega 3.
     “If you can raise high quality, heart-healthy beef and do it for relatively the same cost, why wouldn’t you do that?” Sterling asks.
     Today about 40 percent of his calves are halfblood Angus/Akaushi, and by next year about 60 to 65 percent of the calf crop will be half Akaushi.
     Sterling’s diligence regarding quality has paid off. His cattle often top the market and receive substantial premiums for whatever branded program they are sold through. For example, his Akaushi halfbloods, through HeartBrand Beef Inc., receive a $20 per hundred premium, and cattle sold through National’s all-natural program garner an extra $300 per head.
     Sterling Ranches maintains both spring and fall calving herds, the latter accounting for about 60 percent of the total. It affords them some marketing flexibility, and given that the operation is large and relatively spread out, it also helps with the logistics during branding and weaning.
     Sterling has what he calls an A herd and a B herd. All cows start out in the A herd. Anytime anything goes wrong with a cow, either a bad bag or a missed calf, she shifts over to the B herd.
     He keeps 15 percent of his heifers year in and year out, and all replacements come from the A herd, mostly his fall calvers. The heifers, bred at 15 months, don’t get any special treatment. If a heifer doesn’t calf that first year, she’s gone.
     “All the heifers that I keep, their grandmother and mother have never missed calving,” Sterling says. “Breed-back is so important, and we’re breeding that in.”
     If a cow misses down the road she gets a purple tag; if she misses again, she, too, is gone.
     “I shouldn’t keep any of them; I’ve proven to myself it doesn’t work, but keeping numbers up in this market is pretty important,” he says.
     All keeper heifers are year branded. At 11 years of age, a cow is removed from the main herd. Culling at that point is particularly rigorous. If a cow is still in good shape, she gets another year, but after 11 those cows are always kept in a separate herd.
     Everything is still done horseback. Their cattle are easy to handle and easy to work, in part because they cull hard for disposition. A wild cow costs him money, Sterling says, so there is no home for her on his operation.
     Occasionally during the works Sterling hires some day workers, but for the most part his eight fulltime employees do it all, including pulling windmills. Though Sterling is a hands-on operator, he also respects his hands and asks for input. Consequently, even with the challenge of the oil boom taking so much of the potential labor force, Sterling has been able to keep a team of tenured employees. One has been with him for 20 years, another for 15, another 12, and three of them have been with him for eight years now.
     All of his calves are weaned and preconditioned before they go to market. He typically sells nearly all the fall calves. With the spring calves he sells some and feeds the rest. For years he fed at C Bar in Plainview with the Carter family; today he feeds at Beef Tech, which is also in Hereford.
     For years he sold his calf crop off the ranch through two northern buyers, one out of Iowa and another out of Minnesota. His cattle were of the quality and they had enough hair on them that they competed well in those northern markets. A couple of years ago he lost his buyers for various reasons, so he began selling some calves through Superior. He likes the exposure his cattle get, but he’s made it known that he doesn’t like Superior’s one-way slide.
     “Typically we’ll offer these calves a month to six weeks ahead of when they’re going to leave. If it stays hot and dry, they’re going to shrink, but in this part of the world, if we get some cooler weather and some rain, these calves will gain two pounds a day,” he points out.
     Sterling expects to make some really good money this year.
     “It’s the best time ever. Even if I live to be 90, I never dreamed I’d ever see a market like this.”
     He’s asked himself the typical question — are we pricing ourselves out of the consumers’ reach?
     “We’re still selling it; we may break some more feeders in the process, though, and that’s not a good thing.”
     He worries some, too, about price discovery.
     “The futures are so disconnected and have been for several years,” he notes. “They’ve been behind the cash $10-12; and now cash is ahead of the futures. The original intent and purpose of the futures was good,” he opines, “but I think now it’s driven by the funds and not really connected to the farmers and ranchers. The corn and cotton futures are much closer to the market than the cattle futures.”
     He acknowledges that all of the various branded programs are impacting price discovery, but like most others, he’s not sure what can be done.
     “I have to worry about the things that I can control, and there’s only so much that I can control.”
     He of course is not just referring to price discovery but also Mother Nature. Like so many, Sterling was hit hard by the 2011 drouth. The previous year had been a good one and much of his country had plenty of standing forage. It stopped raining in October 2010, though, and from then until September 2011 less than an inch of rain fell on practically all of his country. To make matters worse, a wildfire scorched 45,000 acres of his University lease. He lost 150 cows and 45 miles of fence in that one fire. It was one of the hardest and most emotional experiences in his ranching tenure.
     “The wind was blowing 70 miles an hour,” says Sterling. “Most of those cows never made it to the fence, and the pasture was only 1.5 miles wide.”
     He lost another 6000 acres on a ranch near San Angelo. Fortunately, his cattle were spared, and he figures it benefited the country because the fire took down a lot of the cedar.
     The big fire and the extreme drouth forced him to make some tough decisions. Taking into account the fact that the cattle inventory was at a record low, Sterling, like many, gambled on trying to outrun the drouth by hanging on to his cattle and shipping them to other parts of the country rather than selling out. It was no small move, by any means; he had to relocate about 70 percent of his cattle, of which 2000 cows went to Oregon and California.
     Those were some anxious days, particularly when loading out those 62 trucks.
     “I knew I couldn’t stay here, and I didn’t want to sell out,” Sterling reiterates.
     His daughter and son-in-law went with the cattle and stayed for the entire 15 months. It turned out to be a good decision. Unfortunately, he had to come home a bit earlier than he would have preferred, as it began to get dry there, but he’d had some rain on his Coahoma ranch, and in the meantime he’d leased additional University country.
     Though his country still hasn’t fully recovered, it’s a lot better than it has been for the last several years. He’s had some timely rains this year, and because he’s always been a believer in moderate stocking coupled with rotational grazing and continued brush maintenance, his country bounced back quicker. And it’s not just his deeded country that he cares for in this manner. A percentage of the income derived from his lease operations goes back into improvements on the lease country.
     “When I lease ranches, I try to leave the ranch better than when I took it over. I want the grass better, the fences better, the corrals better,” says Sterling.
     Typically he helps the landowner get signed up for an EQIP program. He owns three excavators, and he tries to keep those machines running year-round. He also spends a fair bit of money on reseeding on those grubbed areas, all done horseback.
     “The end goal is the cattle, but to get there you have to do a lot of the small things,” says Sterling. “It’s just like writing the story; you have to have the pen and the paper and the subject … the way to improve the cattle operation is to improve the grass.
     “Plus, it keeps me on good terms with the landowners, but mainly I do it because I know in the end it pays for me to do it.”
     On his University country he gets some help on improvements from University Lands. Some long-term UL lessees have become increasingly dissatisfied with UL because of the growing problems they’re experiencing due to the ongoing oil boom in West Texas. And while Sterling has had some issues, he’s been satisfied with how UL has dealt with him and his issues.
     “The University lessees who are complaining need to lease some private land and work with those private landowners for 15 or 20 years, and then they would be really proud to have their University leases back,” Sterling insists. “There’s no pool of money for improvements on a private lease. They’re not likely to help me rebuild 45 miles of fence after a fire like the University did. You’re mostly on your own when it comes to improvements on private land, or you have to convince them to help by enrolling in EQIP.”
     Given that the University Lands system has surpassed $1 billion in net profits thanks to the oil boom, he admittedly wonders some about what the future might be for the UL grazing lease program. He hopes, though, that the public will hold them accountable.
     “University Lands is still responsible for that surface, and if they have reporters coming out from the city and it just looks like crap and chaos, they’re going to write about it,” he opines.
     Some of his country is not as well watered as he would like, but overall it’s good cow country because it’s year-round country.
     “In Oregon when we were there, we cut hay in the summer, and fed it in the winter. That really makes you appreciate year-round country.”
     Sterling is constantly looking to see how he can improve the operation. He’s made plenty of his fair share of mistakes, but he’s learned from them, too.
     “Everyone has an agenda, and I try to take part of their agenda that fits my operation or goals.”
     Sterling Cattle Co. is a family affair. Sterling and Theresa, his wife of 35 years and the glue that holds the family together, have three daughters. His oldest daughter, Tara, her husband, William Renfro, and their two young children, live at Coahoma. They take care of the deeded and leased country around Coahoma.
     Karen, a school teacher, lives in San Angelo with her husband, Ryan Rechichar, and their two kids. Laci has her Masters in accounting, and at the moment is working for an oil and gas company in Snyder.
     They’ve all spread their wings, but as a family, ranching is at their core. In 2006, when Sterling was considering bidding for his first University Lands lease, he was not necessarily looking to grow, but he took the proposition to his family, and in unison it was they who made it known they wanted to grow.
     Tara, who has been back at the ranch fulltime since 2006, admits that she never really intended to come home to the ranch.
     “I was going to be a stockbroker on Wall Street and wear the four-inch heels and have my hair in a bun and make millions of dollars,” she quips. “Then I went on a college trip to New York and hated it, so I decided that wasn’t for me.”
     After finishing her Masters, she took a job in insurance adjusting to get out of debt.
     “I was determined to make it on my own,” she recalls.
     However, during that time she really began to take notice of what her dad did and how he’d built up a really good operation on his own through hard work and perseverance with little outside help. Thus, it was on her own timetable with little to no encouragement or coaxing one way or another from her father that Tara came back to the ranch.
     At first the reins were really tight. She went everywhere with her father. Mostly she learned by watching what he did or didn’t do. She remembers well the first day that she got to do something on her own and be the boss.
     “It took a long time to get there, but when it happened it was a pretty neat day,” she recalls.
     The Oregon experience has been, to date, the toughest challenge for Tara and her husband for all the expected reasons. They were in charge of 2000 cows that were in pretty poor condition because of the drouth, not to mention they were in a foreign land with no family or friends. But that was only the half of it.
     They arrived in mid-September and began calving the first of October. William had been out riding and decided to put out some hay in one of the meadows for a small bunch of cows. He was walking behind the tractor tossing the hay and rolling up the twine when the tractor began to deviate from where he wanted it to go. He stepped up on the tractor and was just going to turn the wheel when the twine began to wrap around the wheel and then his foot and it drug him under the wheel. The tractor ran over his back and hips and shattered his leg.
     He was down in the bottom of the meadow with no one around and no cell service. He managed to drag himself over to a place where he was able to get a text out to Tara, but the text was not at all intelligible and she had no idea where he was. Eventually he was able to get a call out, and the doctors were able to put him back together.
     Calling her husband “a walking miracle,” she acknowledges that it is only by the grace of God that he is alive. The meadow had just been flood irrigated, so William’s body sank down into the softened earth. It was a long, hard recovery. It wasn’t until January that he was able to put any weight on his leg.
     Tara took over. She went from never driving a tractor, haying and feeding off a tractor, to calving out 400 heifers and doctoring calves all by herself.
     Reality was rough, but they managed, and in the end it turned out okay. She got GAP 4 certified, which is Whole Foods’ Global Animal Partnership pasture program. They marketed those calves for the first time as GAP 4 certified through Superior and did well.
     They’re back at home now and looking to the future, a future in the cattle business. Now 34, Tara sees more opportunity than ever before for young people. Just as stubborn as her father and just as independent, Tara doesn’t believe that everything should be handed to them, though having some help, particularly in the form of a good mentor, certainly helps.
     “If one day Dad decides he’s ready to walk away, I want to make sure that what he built only gets better,” she says.
     Don’t expect that to happen anytime soon, though, as Sterling says retirement is simply not in his future.
     “Why would I want to quit? This is what I love — being out every day, seeing the cows, watching the calves grow and watching and being part of the evolution of the industry.
     “I might do it a little slower,” he admits, “but there’s no quitting for me.”