Hollinger Cattle Company, Camden, AL, always finds new stocker opportunities, no matter the market.
“What I like to do most is grow grass and graze cattle,” says Leo Hollinger, Jr., of Camden, AL. “My passion has always been to put light calves on grass and grow them to heavier weights.”
His grandpa, Fleet Hollinger, was the first in the family to see potential in growing cattle here in the timber country of Alabama. It was during the Great Depression. With a wife, three kids and some ground, Hollinger's grandfather figured his best opportunity was buying lightweight calves and adding weight to them. This core philosophy put Leo's dad and two uncles through college.
Hollinger and his wife, Jeannie (Hollinger Cattle Company) utilized the same opportunity to raise and put their own children through college.
Though the primary business of adding weight to cattle continues, Leo explains preserving equity and turning a profit are more challenging today than ever.
“We are dealing with a more volatile market and economic climate than I've seen in my lifetime,” Leo says of his four decades in the business. “I think it requires assessment of how much risk we're willing to take on any single roll of the dice.”
Always an alternative
Until three years ago, Hollinger Cattle Company procured its calves through a local order buyer. These calves came from within 200 miles. Over time, it became difficult to get the number of lightweight cattle they needed when they needed them. Leo chalks that up to the improved genetics and management employed by the state's cattle producers.
At the same time, these calves were getting tougher to handle from a health standpoint.
“I think what it amounted to was too many hauls on the calves in too short a period,” Leo says. Typically, those calves would be hauled to the sale barn by the seller. The order buyer would purchase them and haul them to his gathering facility until a load was made, and then they'd be hauled to Hollingers. So, the calves were hauled three times within a week.
Countering both challenges, the Hollingers began procuring calves via a cattle-buying service in Florida, which buys the calves and preconditions them for 45 days. Many are purchased ranch-direct, so they have one haul to the order-buying facility, then another haul 45 days later to the Hollingers.
“I don't see what's wrong with letting someone else do what you can do, when they are able to as well or better for the same money or less,” Leo says. “For us, it's a cost-effective way to procure cattle when we consider cattle health, time management and the bottom line.”
A few years prior to the transition in procurement, the Hollingers also diversified their risk by weaning and preconditioning calves for others.
“It more effectively utilizes our labor, time and management, complementing our stocker business,” Leo explains. “You're doing the same thing with the same facilities; you're just working harder in the off-season.”
On one hand, weaning and preconditioning for others allows customers to exploit the value of sorted load-lots, which their own smaller numbers disallow. Leo says, “This provided a way for us to take a limited amount of capital and make more money, or the same amount of money, as if we invested our money in two or three turns of buying and weaning 500-lb. cattle.”
For perspective, the primary program at Hollinger Cattle Company revolves around buying calves averaging 350 lbs., putting 400 lbs. on heifers and 500 lbs. on steers, and then marketing them in presorted load-lots.
The Hollingers have purchased primarily heifer calves the past few years. “These heifers are bringing in the mid-$90s and steers are at $1.15-$1.20. On a calf weighing 350 lbs., that amounts to about $70/head. In the last couple of months, there was only a $5-$6 difference between yearling heifers and steers, or $40-$50/head,” Leo says. “So, I can risk less money upfront on the heifers, and upfront is usually where the biggest risks are. The only advantage with steers is they perform a little better and you can keep them to heavier weights.”
Moreover, the Hollingers manage price risk via the futures market, especially during the early months of ownership. They also price commodity inputs further ahead when it makes sense.
Starting the first of April, the Hollingers test-weigh groups and presort loads. By the middle of April, they'll begin selling 2-3 loads every 2-3 weeks, mostly through board sales at Linden Stockyard in Linden, AL. That continues until the middle of June when their lightest cattle are ready.
“The biggest issue with presorting is it reduces the stress on the cattle,” Leo says. Sorting ahead of shipping also reduces shrink and allows them to know where they stand in terms of the weight.
Litter and legumes
These calves are primarily grown on forages such as summer bermudagrass, bahiagrass and crabgrass, then early fall annuals such as cowpeas and pearl millet until the cool-season staples of ryegrass and clover are ready to graze from February to May.
“Legumes are high-quality forages that we can use for cool-season grazing,” Leo says. “They require less nitrogen to grow, improve the quality of our feed, and then leave us enough residual nitrogen that we're able to grow and cut all the hay we need.”
Broiler litter continues to be the trump card of Southeastern grass growers to reduce nitrogen cost. It's about $20-$30/acre less than commercial fertilizer. The Hollingers also get their lime for free.
“You couldn't afford to put out enough ground limestone here to maintain a soil Ph close to 6,” Leo says. But a waste product from area paper mills has the same effect, and these mills will provide and spread it for free.
Leo views the soils on their operation as a bank of sorts. Through meticulous management, they have built the reserves over time to the point where they can begin withdrawing some when it makes sense.
“Leo always says, ‘I don't consider myself owning this land and I don't intend to sell it; I'm just using it,'” explains Jeannie.
As such, the Hollingers were adopting environmental stewardship practices like planting buffer zones and fencing off riparian areas before these became regulatory necessities.
“We have neighbors whose kids still play in that creek,” Jeannie says, referring to the crystalline Pursely Creek that runs across their place. “We need to keep it safe for them.”
Fleet Hollinger would be proud. “I think we're utilizing this land to its best advantage with stockers,” Hollinger says.