Chris McGrath's Value Sires series in the TDN has frequently touched on the difficulty in selling nominations to stallions in their third-year at stud, as well as to solid, established stallions standing for a moderate fee. We asked stallion managers and nominations teams as well as bloodstock agents what changes could be made, if any, to help the situation.
Peter Bradley, Bradley Thoroughbred Brokerage
It all comes down to the fact that there is too much supply on the market. We have followed this path over the last 40 years or so. I don't know the exact numbers, but I know that average book size has pretty much doubled.
We naturally limited book size 40 years ago. When I was first back here in the 80s, there was a nice horse named It's Freezing, who was a very good meat-and-potatoes type of sire. He stood for around $10,000 to $15,000, and he would get his 70 mares every year. You draw a line from him to a horse like Run Away and Hide, who is a very good racehorse sire, but he was sold this year because they couldn't get enough mares to him. I would say that those two sires were very similar in that they could get you a racehorse at a reasonable stud fee.
The combination of the commercial market wanting something that you can sell instead of a true racehorse sire makes these proven, moderately priced stallions hard to sell.
For the good of the game, limiting book size would help, but on the other side of the coin, I like the free market that lets the chips fall where they may. It's a difficult conundrum because in the end, even if you limit book size, some horses are going to get weeded out anyway.
You have this boomerang effect where you go from 150 foals in your first crop, and then 100 in your second, but then all of a sudden you're at 30 in your third crop. Even if the first two crops can run, you're going to have a void there when that third crop comes around.
There are these programs where you get a breeding right if you breed to the horse, and essentially if you don't have to put money up front and you don't have a vested interest from that standpoint, it makes it easy to walk away from what you've got instead of using it. These programs have been tools that in some ways have worked, but in other ways they have created an excess number of seasons that people aren't using. So if the farms want to sell their season they have to cut the price substantially to get it sold.
When you look at promotions as an answer, I don't think you can promote every horse. If everyone is doing the same promotion, it's not going to make people go to 20 different stallions. One of the most interesting promotions we can look at is Runhappy. The promotions are only as good as the offspring, and people liked Runhappy's yearlings, so if you add incentive to something you already like, it's going to be beneficial. The market forces say that the horse has a chance of making it, so if you add a promotional carrot on top of it, that probably helps. But if you do the same thing to a horse that is less popular, I don't think it would be beneficial.
It simply comes down to supply and demand. The oversupply of seasons rules what we are doing. If you have the right horse from a market standpoint, you get the mares to him. A horse that is doing extremely well this year that I think will carry on to next year is City of Light. He's a horse that everybody is on, so people will gamble on him in his third year.
If you go back to Economics 101 and look at supply and demand, it all comes down to market forces and oversupply. In my opinion the market will not change and may not even be able to change, so addressing the oversupply is our best answer.
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