Two events took place last week in the U.S. last week that may not be directly related, but the same overwhelming force had an impact on both of them.
We had this presidential election thing and selected Barack Obama as our next leader and we also had the Harrisburg sale, harness racing’s one-stop shopping mall.
John McCain went down in the election largely due to the economic upheaval and sale prices went down at Harrisburg largely due to the economic upheaval.
The economic upheaval turned Republicans out from the White House and into the dog house, and turned Harrisburg from a mall into Wal-Mart.
There are other comparisons. I worked in political campaigns many years ago and there is nothing more exhilarating than being at an election party when your candidate wins. Conversely, there is nothing more depressing than being at an election party when your candidate tanks.
I once worked on a campaign of a guy who had a successful sporting goods business. He decided he wanted to dabble in politics and was pitted against a matronly woman. Our guy had name recognition, money, endorsements -- everything except a willingness to work to win election. His opponent outworked him and got more votes and that election night scene was so traumatic that I remember it still.
Candidates always look to blame someone -- after all, it couldn’t be their fault, could it? -- and they love to blame the people who ran their campaign. So when the results were known at the election party, I ducked out a side door.
There is noting more exhilarating that being at a horse sale when you or a friend sells a horse expected to bring $20,000 for $50,000. There are handshakes, high-fives, and smiles all around. Champagne flows later that night.
Conversely, there is nothing more depressing than being at a horse sale when a $50,000 horse sells for $20,000. Recriminations abound. Friends duck out the side door as soon as possible.
I suspect that friends of some Harrisburg consignors were ducking out side doors (and there are lots of those at Harrisburg) or hiding all the sharp objects last week. It wasn’t pretty. It also wasn’t unexpected.
I enjoy elections and horse sales, but they don’t always turn out the way you expect.
I’m not the only political junkie in my family. My daughter Meredith had just turned five when Bill Clinton beat George H.W. Bush in the presidential election. I remember we asked her who was president. She thought for a while, the five-year-old wheels in her brain spinning, and blurted out, “George Clinton!”
Meredith was either being precociously bi-partisan or she was thinking of the pioneering funk musician of the same name. I can assure you that she now knows the name of the president, which is reassuring since she is majoring in political science in college.
The economic storm turned into a tsunami in the weeks leading up to Harrisburg. It was a classic case of bad timing. If it’s any consolation, the situation was even worse at the concurrent Keeneland sale in Kentucky. The last I looked the sale average was down about 30 percent there.
Bid-ins abound at such sales. At some sales, they are listed as RNA or no sale while others simply list the name of the person signing the slip. It doesn’t take much digging to sniff out some of the bid-ins. You see people closely affiliated with the consignor signing the sales slip. In the racehorse portion at Harrisburg, you saw trainers signing slips of horses they’ve trained.
One person lamented the number of broodmares hammered down at giveaway prices. But you must realize that a mare sold in foal in 2008 won’t likely generate any income for the buyer for 24 months.
I noticed that mares in foal to Revenue S, whose first crop didn’t exactly set the world on fire, were treated as if they were radioactive -- no one wanted them. You could buy some mares with nice pedigrees in foal to Revenue S and breed them to the stallion of your choice. And I also suspect that the offspring of Revenue S will be held in higher esteem in a year or two.
One thing I really like about Harrisburg is that they keep a tally of the eligibility of various yearlings and note the average prices.
So for 2008, the New York-sired yearlings averaged $38,205 while Ontario-eligible yearlings checked in at $32,910.
After New York and Ontario, the programs ranked in this order: New Jersey, Pennsylvania, and Kentucky.
It would be a nice feature for breeders to list the “covering sires” on in-foal broodmares and their averages. That way we could tell how much that the mares in foal to Credit Winner, Ken Warkentin, Real Desire, or Artiscape sold for.
A presidential election and the Harrisburg sale -- yes, two significant events last week.
remember all hay and grain
remember all hay and grain harvested this year was done when gas prices were @the top.hauling to races also drained the profit side of the ledger.there was less profits from other ventures to shore up horse costs. if every breeder culled 1 mare to offset low cash flow, all horses will sell cheap. remember the slot play has also fallen in all areas, so there will be less in the purse accts next year. so with higher expenses to get to the races next year to race for smaller purses, only thev brave are breeding more mares.friends we have a world wide depression on our horizon, there will be more culling of the stock ahead/ jk
Just read your blog on The
Just read your blog on The Harrisburg sale at SC. I pretty much agree with all your thoughts....a few other points though:
1) With a few exceptions, Standardbred racing as a whole hasn't been real healthy. Ohio and Kentucky are dying and literally begging to get some relief in the form of racinos.......VLT's....or whatever you want to call them. NJ isn't far behind. But how long will politicians subsidize an industry that's on life support---no matter how many jobs are involved, either directly or indirectly.
2) The Jersey Classic sale has a reputation among yearling buyers as being "a cheap sale." The place you have a really good shot at getting a bargain. Ron buys there on a regular basis; last year he paid $8,500 for an Artiscape colt. The colt took a mark of 1:53.3f and made $125,000 this year, and is on the back cover of this year's catalog. (Allamerican Improv.) I've never seen the sale as bad as it was this year. They averaged $7,875 for
208 yearlings. 2007-$9,856 for 227 yearlings. 2006-$9,936 for 269 head. Doesn't take a rocket scientist to see the trend :( The Ohio Jug Sale ($5,400), Canadian Open ($10,786), PA Preferred sale ($8,690), Forest City Preferred ($6,180), and even Morrisville ($10,774) were pretty much blood baths for the breeders.
Ohio Jug Morrisville
282 Catalogued 227
262 Sold 197
$40,000 High Price $80,000
$700 Low Price $1,000
6 $20,000 yearlings 26
137 $4,999 or less 53
$5,476* Average $10,774
*I calculated the average as the sales company didn't. (Can you blame them?) My math may be a little "iffy".....
Ohio Jug was dismal, but with a sire stakes estimated at $19,000,000 next year, you would think the Morrisville sale would have done a little better. Some of the sires in the Morrisville sale were horrendous though---Magical Mike, Whelan Willie, Dilbert Hanover, Sealed And Delivered.
Another thought re: the economic condition in North America, if not world wide: Russ Williams from Hanover Shoe Farms for years has bid and bought horses up to $1,500 to keep them away from "the killers." This year, his price was down to $1,000.
As far as "good" sales, I'd have to say Lexington ($40,494 and 32.1 million gross), was really the only sale eligible. Harrisburg was way off, averaging slightly less than $30,000. They did sell by far the most yearlings though with 1096 being auctioned. Forest City Selected averaged $21,485 but the results were a bit of a shock if you look at sire averages. Only 6 sires that sold more than 1 yearling averaged $20,000 or above. (Most "experts" consider $20,000 to be the "break even" point on a yearling.)
3) The breeders shoot themselves in the foot every year. They don't even find new and innovative ways to damage their bottom line---they stick with methods that haven't worked in the past.
A) Not selling all their yearlings, keeping what the public may perceive as "the best ones" for their own racing stables. Anyone who follows harness racing can easily name 6 or so of these breeders right off the top of their head. Every farm has a couple that aren't sold due to injury or illness, but some retain way too many for the public to be comfortable.
B) Instead of setting a reserve, have your office staff, uncles and cousins bidding up your yearlings.
C) Have your trainer/old crony in the crowd to buy any you think are "going to cheap." (He was better about it this year though.)
D) Outbid legitimate bidders; after the sale, attempt to sell them the yearling at a "discount." (Don't think they sold any this year.)
E) Treat it as a business folks! No matter how much you love a mare, or how many stallion shares you have if they aren't producing you need to move them, cut your losses and upgrade your stock.
F) If you are a small breeder, send your yearling to a Professional for 2 months or so to get them "sales ready." It's odds on that a farm that prepares a couple hundred yearlings a year for the sales ring has more experience and a better chance than a breeder with 2 or 3 yearlings a year.
I can guarantee the $15/day will show in your bottom line.
G) Have a pompous sounding slogan...when in reality you haven't bred a horse that could beat anybody in years.
Your thoughts?
Hey Dean: I noticed those
Hey Dean:
I noticed those mare prices too ... scary to think that a number of breeders consigned in-foal mares (stud fees paid) that brought $1,000 - 2,000. What a bath they took, after sale entry, transportation and consigning fees. And for sure, there were a few very good pedigrees among this group.
In addition, I noted that some breeders appeared to be cutting their overhead and operating costs by selling barren mares. And some of these had outstanding maternal lines.
In my mind, the 'Breeder' or 'would-be Breeder' would be well-advised to pre-examine prospects as the top yearling people do. Have ALL potential broodmare purchases 'evaluated' - (age, family strength, mare's production, yearling prices, performance, current status, stallion choice, jurisdictional considerations etc.) - and then a A, A+, A++ (no room for B's, C's etc. ;-) and suggested 'high rice' provided.
Bottom line is that there were some 'A' mares that sold for much less than they should have.
BTW - do you recall years ago that FILLY yearlings (particularly trotting fillies) were the highest priced commodity at the sales? I noticed that the trotting fillies sold for LESS than their male counterparts (I'm sure Dewey & Beach had a part in this) - probably further illustrating the 'time commitment' to 'retaining a filly to breed'.
"Nope. Sorry - not interested. Want a colt." We have seen this attitude before - I want it ... I want it now ... and I'll pay more for it.
For those willing to invest in the FUTURE of the breed ... the next couple years are EXACTLY the time to buy top-bred mares. Just as I have been tempted to but some 'penny stocks' (like GM?). As Bill Wellwood told me years ago - one of his major strategies for success was to "Be where THEY ain't." ;-)
In reply to Hey Dean: I noticed those by Ralph Sucee (not verified)
Thanks for the comment,
Thanks for the comment, Ralph, and I hope all is well!
In reply to Hey Dean: I noticed those by Ralph Sucee (not verified)
The prices at the Forest
The prices at the Forest City Mixed Sale today were enough to make you cry. Average was slightly over $5000. I realize she was barren, but $100 for a 14 year old Abercrombie mare???? Second dam was by Albatross and third dam was by Bret Hanover. Many others sold for what appeared to be bargain basement prices. I didn't see them, but surely on breeding alone they were worth more than the pittance they brought. Sad. Very sad.