The following Letter to the Editor was submitted in response to Kevin Blake's Dec. 13 Op/Ed on the foal sale market and potential solutions to the challenges at the bottom of the market. Should you wish to chime in, please send your thoughts to [email protected].
A few points in response to Kevin Blake's excellent piece on the foal sales results in 2018.
The first is that I think he underestimates the cost of getting an animal from conception to foal sale. For our stud, the average cost of getting from conception to yearling sale is in excess of £25,000. While our calculations up to foal sale only are a little less well-quantified, I can't see how they can be less than £10,000 fully loaded. Maybe we are high-cost relative to a farm who might breed 'from the field,' but I suspect we are, in fact, just realistic on cost. We find it helpful to keep our heads out of the sand on these matters.
Secondly, whether Kevin's equation on stallion fees is right or wrong is moot. With the median sale price of many stallions' offspring being less than the stallion fee itself, a situation where more than 50% of one's clients operate at a loss is surely indicative of a need to cut fees. What is clear, however, is that there is a distinct imbalance in the monetary risk borne by the breeder versus that shouldered by the stallion master. This could be corrected by stallion owners offering to charge a cover fee only if a certain price is achieved for an offspring but, on the upside, being enabled to share in profits at a certain level in return. This would certainly result in stallion farms closely scrutinising the mares they are prepared to receive. It also represents a fairer sharing of risk than exists currently.
Lastly, I think the single most important factor driving the bottom of the market relates to how 'wealthy' the likely horse owner feels. For other than the very rich, this perception of personal 'wealth' rests very significantly on property prices where the average potential owner has much of their store of wealth these days.
With property prices under pressure due to tax changes, Brexit and other factors, folks don't feel so wealthy these days and, as such, a horse in training is a luxury too far.
There are many small breeders who will produce stock no matter the loss involved and the tradition of Corinthian animal husbandry in this country is to be applauded. For those, let's say, medium-sized breeders for whom losses on multiple foals or yearlings can build up to be significant amounts, some changes are required.
There have been many such stud farms on the market in recent months which must tell a story .
-Colin Bryce, Laundry Cottage Stud
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