Scharbauer Cattle Company Creates a Model for Ranch-to-Retail Beef

It had rained a tenth of an inch on the Scharbauer Cattle Company’s North Curtis Ranch the night before owner John Scharbauer gave me a tour of the property. It was March 31, and that was the most rain he’d seen on this nearly 18,000-acre spread for the last 219 days. Scharbauer had been counting. So had Jim and Janeane White, who live at the ranch house and keep an eye on the property and the cattle. As we pulled up to their house, a sprinkler was struggling to dampen a small patch of dirt that should have been lawn. Jim greeted us outside the truck and said they had waited up for the rain that came at 10 p.m. The pattering drops on the roof had made them tear up. “That’s kinda what we live for,” Jim said.

Scharbauer is a fifth-generation cattle rancher, but he’ll tell you he’s a grass farmer. That’s what the cattle need to eat, and there isn’t much of it these days. It hasn’t rained on the property since that day in late March. The three things that affect the profitability of the beef business, Scharbauer tells me, are the weather, the market, and the management of the ranch. He sure can’t control the rain. But Scharbauer has taken the wheel on the market, creating his own ranch-to-retail operation with Midland Meat Company, which he opened in 2015. It exists outside of the commodity-beef supply chain, which is unique in the Texas beef industry, and the beef he raises and sells there is unique for a Scharbauer.

The first John Scharbauer in the family moved from Albany, New York, in 1880 to Eastland, which is the furthest west he could travel by rail at the time. He bought a small sheep herd in 1883 (the ranch’s founding year, as celebrated by the Scharbauer family), and he raised the sheep while living in a tent on the plains near Sweetwater. In 1887, Scharbauer purchased a ranch near Stanton, just east of a new town called Midland. It had changed its name a few years earlier from Midway, a name that denoted the town as the halfway point between Fort Worth and El Paso. In 1888, the Midland-based Staked Plain newspaper reported, “John Scharbauer of this place consummated the heaviest sheep trade that has yet been made in west Texas.” He had sold and shipped 7,500 sheep to the stockyards in Chicago. Three years later, the shipment increased to 30,000 sheep, according to the Galveston Daily News, but Scharbauer was about to shift his ranching operation toward a breed of cattle that was new to Texas: Herefords.

“One of the best herds here and probably the best in Texas is the Herefords from the ranch of Scharbauer Bros., at Midland,” read the El Paso Daily Herald in January 1901. The paper was covering a local livestock exhibition that had brought in ranchers from across the state. Scharbauer, it mentioned, had been raising Herefords since 1890 and “was the first man in Texas to introduce this breed of cattle.” Texas beef before then had been dominated by Longhorns. Scharbauer Cattle Company, which John had recently formed with his brother Christian and nephew Clarence, would shift that dominance.

Clarence’s only child, Clarence Jr., took over the ranch at the age of seventeen after his father’s untimely passing. In addition to cattle, Clarence Jr. oversaw the family’s hotel, radio, and oil businesses and became a prominent horseman. His horse Alysheba won the Kentucky Derby and the Preakness in 1987, and Clarence Jr. was also president of the American Quarter Horse Association. His son Chris, now 68, took over the cattle-ranching operations in 1979. “I laid the golf clubs down back when I was in my teens, and I didn’t pick them back up until forty years later,” Chris told me. His son is the younger John Scharbauer, who now runs the ranch at age 41.

Chris was happy on horseback, both in Midland and on the property the family purchased in 1952 near Amarillo. The Alamocitos Ranch, as they call it, is nearly 65,000 acres and is, in Chris’s opinion, the finest of the ranch properties the family has ever owned. He still lives in Amarillo, and he’s on the ranch three or four days a week. Although he gave the reins to John in 2019, he doesn’t call what he does now retirement.

Chris learned the ranching business from his father, and he also learned plenty about raising cattle from the ranch’s straw boss, Flop Roberts. In the 1990s, Chris introduced new genetics into the family’s herd, which had been composed almost entirely of Herefords for nearly a century. The red hides and white faces of the Hereford cattle were a distinct symbol of the Scharbauer Cattle Company, but Chris saw that the future was in cattle with black hides. He crossbred the herd with Black Angus cattle and built a new foundation for the Scharbauer Ranch’s bovine genetics. “We had a great herd when he got it, but taking it where he took it . . .” Chris said, trailing off when speaking with pride about his son.

Much like his father, John saw the opportunity to introduce new genetics from black-hided cattle into the ranch’s herd. After graduating from TCU’s ranch management program in Fort Worth, John returned to Midland in 2006 with his wife, Amy, to work on the ranch. Five years later, John bought his first Wagyu bull for $4,000 from Jim Chisholm, who runs the Chisholm Cattle Company Wagyu ranch in Wimberley. They met in a motel parking lot off Interstate 20 in Sonora, parked their trailers end to end, and John led the bull from one trailer to the other. Back in Midland, he turned the bull, JC Itoshigemichi 007 (whom John called Ichiro), out with 25 heifers and waited.

Ranch manager John Scharbauer. Photograph by Daniel Vaughn
The case at Midland Meat Company. Photograph by Daniel Vaughn

The Japanese Wagyu breed is known for its highly marbled beef, which is prized for its tenderness, but it’s also slow growing. John thought if he could breed it to the the Hereford-Angus cross his father had already developed, he could get the best of both worlds. He also hoped this would result in smaller calves, which are easier for young heifers to carry. Nine months after the heifers were bred, those small calves were born. Chris saw the calves and asked John, “You think you can find more of those bulls?” The calves fetched a whole lot more at auction than the regular herd. John bought ten more Wagyu. Back then, he was paying about $5,000 per bull. At a recent auction in Alvarado, he paid an average of $11,000 each for seven Wagyu bulls.

The Wagyu-cross portion of the Scharbauer herd has gown considerably since that first generation. The company slaughters and processes 20 to 25 head per week, along with 5 to 10 head of the Hereford-Angus cross. All of those cattle go from the ranch to Morris Stock Farm, a feedlot in Gruver. After being grain fed for about three hundred days, they’re processed at one of two Texas plants, then the beef is sent back and stocked in the meat case or the freezer at Midland Meat. “Everything I raise now goes to the market,” John said. And some of it goes from the market to the Half Acre, his barbecue joint on the north side of Midland.

Locally raised beef sold in a meat market run by the ranch owner is unusual in Texas. It requires a building, of course, which John originally opened in 2015 (he followed up with a larger Midland Meat Company in a new building earlier this year). But it also requires beef that’s noticeably different from what can be purchased at the local grocery store and enough customers willing to pay for it. After one look at the tri-tips in the meat case, striated with so many white streaks of fat they resemble candy canes, it’s clear John has raised better beef than what’s available most anywhere in Texas, let alone Midland.

John wasn’t so sure of his plan after opening the doors to the meat market back in October 2015. Oil was $28 per barrel at the time, John says, and one of the market’s first visitors saw the price of the ribeye at $29 per pound (the current price is $39), said, “You can’t sell a steak for more than a barrel of oil,” and walked out the door. After news of the market’s opening made the front page of the local paper later that weekend, things turned around. “Within two days I ran out of the ribeyes I had,” John said. Soon after, the tenderloins, strips, and sirloins were gone, and John had to remind customers there is a whole lot more to a cow than the middle meats.

He had hired Midland’s best butcher, Adrian Vargas, away from H-E-B and asked him for ideas. Vargas added lesser-known cuts like the tri-tip, picanha, and Denver steak (cut from the shoulder). John’s next problem, he recalls, was “What are we going to do with all this grind?” They advertised burger packages that came with cheese, buns, and all the fixings. He partnered with local chain JumBurrito to use Midland Meat ground beef, so burritos and tacos filled with Wagyu beef are now the norm in Midland. The issues Scharbauer Cattle was facing were a microcosm of the problem with premium beef production in general: everyone wants the center cuts. While it’s hard to convince people to spend a premium on ground beef, that’s what’s left when the steaks are gone.

Thankfully for folks in Midland, they don’t have to pay as much of a premium for any of the Scharbauer Ranch’s beef. “The cattle business is one of the few where somebody else tells you the value of your product, and that’s all you can sell it for,” John explained, which is why he he wanted to get into the retail side. Before Midland Meat, Scharbauer Cattle sold all of its calves to the highest-bidding feedlots. The cattle were out of their hands at that point, and the meats entered the commodity-beef supply chain. After being bought and sold multiple times, they’d show up in the grocery store with every buyer’s markup added on. At Midland Meat, the prices may seem high, but for this quality, they’re more than reasonable.

I grilled up some ribeye and a strip steak at home. The marbling was spectacular, and the tenderness was superb. Pure Wagyu beef verges on pink in color, thanks to the high fat content. It’s too rich and buttery to enjoy more than a few bites. The cross Scharbauer Cattle is producing in Midland is still rich, but it’s beefier in flavor—and even the hard edge of fat along the strip steak is soft after grilling, thanks to the Wagyu genetics.

“The taste, the quality, and the tenderness,” are all what drew world-renowned chef Daniel Boulud to the Scharbauer beef. He’s served it on the tasting menu at his namesake restaurant, Daniel, in New York City. John had never been to the city, but in 2017, he invited his dad to meet him there. Chris told John that his goal for the Wagyu cross was for it to be considered “white-tablecloth meat.” They sat down, and, Chris recalls, “I opened the menu and I saw Scharbauer Ranch beef. I said, ‘Good gosh, John, you’ve got this done.’ ” John pointed to the tablecloths. “That’s when I stopped worrying about [the beef] being good,” John said. This week, Scharbauer Ranch sent a new shipment to New York, where the beef will make another appearance on the menus of Daniel and the new Le Pavillon.

That New York visit was in the same year John had taken over the family’s cattle operation, so Chris already knew it was in good hands. But “it just really made me proud,” Chris said of where John had taken the Scharbauer name. It’s attached to schools, streets, sports facilities, and bodies of water around Midland, but to see that name on a New York City tasting menu was special.

The Scharbauer name now hangs in the Texas Cowboy Hall of Fame in Fort Worth, too. In a ceremony held in March, Chris and John were onstage to accept the award for the Scharbauer Cattle Company. After a video played, outlining the family’s contributions to the Texas cattle industry, a medallion commemorating the induction was hung around Chris’s neck. Both men spoke briefly, then Chris approached his son, took off the medallion, and hung it around John’s neck. The Scharbauer torch had officially been passed.