How Can The Breeders Survive?

The Standardbred Breeders of Ontario Association has sent the following letter to all Ontario MPPs and to OLG Chair Paul Godfrey

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Landing as it did, smack in the midst of our foaling season, the announcement terminating the Slots at Racetracks Program couldn’t have come at a worse time for Ontario breeders. Within minutes of the “Black Monday” announcement on March 12, 2012, the value of our assets vanished: our farms, our horses and our livelihood. The industry is currently in a state of panic as there is simply no market for our Ontario-sired horses.

Keep in mind that breeding farms currently have three years worth of investment in horse stock standing in their farm yards; yearlings that will be offered for sale this fall, foals being born this year, and pregnant mares. All of these horses have no perceived value due to the announcements stating the end of the Slots at Racetracks Program. Considering that the sale of yearlings in the fall is the sole means of income, it spells financial ruin for most breeding farms across this province and for those businesses that supply and support the breeding and racing industry.

In 2011, 4,059 Standardbred mares were bred within the province and the resulting foals will be delivered now thru to early summer. The average cost of production for a yearling cited in the 2007 Ontario Racing and Breeding Industry Profile study was $21,041, not including stallion service fees which range from $3,000 to $20,000. Mass slaughter is the scenario that played out in 2008 when decisions of the Quebec government resulted in the closure of racetracks in that province. This is an outcome that we want to avoid at all costs.

There are approximately 2,500 Standardbred breeders in Ontario. We are hardworking individuals who have invested everything into our farms, properties and into improving the quality of our livestock. Most of us are self-employed and hire additional labour to run our businesses in areas where job opportunities are scarce. Thousands of acres of prime agricultural land are required for producing grain, hay and straw. Services and products are obtained from veterinarians, blacksmiths, hay and grain suppliers, transport companies, tack, etc.

About three to four years of time and resources are invested into raising a horse before it is able to generate any return on investment. As a result, horse breeders are unable to respond quickly to market changes such as those announced this past week.

The Ontario Sires Stakes (OSS) program, which is deemed to be the best in the world, has been modelled by other racing jurisdictions as a means of supporting the agricultural sector. The racing opportunity for young horses in the Ontario Sires Stakes is the factor that makes the horses we raise worth purchasing in the sales ring and on the racetrack.

Another critical component that has helped ensure that economic investment occurs in the province has been the Ontario mare residency program which encourages individuals to keep mares in the province for 180 days surrounding foaling. Many mares have relocated to Ontario (foreign investment into the province) resulting in additional economic spinoff.

About half of the Ontario Sires Stakes purses in 2011 came from the industry’s portion of the Slots at Racetracks program. The other half came from wagering on our races--funding which will now amount to a trickle, faced with the planned proliferation of other gaming. Based on racing opportunities, purchasers will now be willing to pay only a fraction of what is presently invested in raising a yearling. Breeders will be guaranteed exorbitant losses, resulting in the death of an industry.

Needless to say, business at farms that stand stallions is being affected each day since the announcement. Stallion service bookings are being cancelled hourly. Mares are being relocated to other jurisdictions-- many to New York which has a healthy Sires Stakes program that is not in jeopardy.

Furthermore, many farms, having invested significant money in acquiring quality stallions, are watching their incomes disappear with stud fees that are now unlikely to be paid.

The slots revenue was the stimulus needed to energize and expand the industry, to the point that the horse racing sector currently contributes over 60,000 jobs to Ontario’s economy. Over 31,000 of those positions are fulltime. Horse racing’s expenditures for supplies and services within our communities exceed $2 Billion annually. But now, without either consultation or warning, the Ontario Government has placed a successful program in jeopardy. A five year lead time would have allowed breeders to gradually divest without having to go through financial ruin and unemployment.

The Standardbred breeders of this province support the Ontario Horse Racing Industry Association which speaks on behalf of horse racing industry and ask that dialogue be initiated immediately to preserve the breeding industry before it is completely decimated. Independent analysis on implications of government decisions in consultation with OHRIA should be required before any further action is taken. That will ensure that there is a full understanding of how decisions will impact the province and the development of a responsible action plan. It will be unable to return to a healthy state once it is destroyed.

We hope and believe it is not the government’s intention to do away with horse racing, therefore it is imperative that we ensure that a horse supply exists which requires the presence of a breeding industry preferably based in Ontario where the province can economically benefit from this activity. For a modest investment and with proper re-structuring, we can ensure that a healthy supply of Ontario bred horses exists by protecting the Ontario Sires Stakes program. In order to salvage what is left of our breeding industry, announcements regarding the government’s intentions of maintaining a horse breeding sector must be provided IMMEDIATELY.

Recent announcements have been made stating that landlord/tenant negotiations will take place with individual racetracks. However, the process provides no commitments to breeders. Measures must be put in place to guarantee the stability of this important subsector of agriculture.

It is extremely important that we (through OHRIA) are able to meet with you and discuss how the breeding sector can survive.

Sincerely,

Anna Meyers, President

The Standardbred Breeders of Ontario Association