OVER 220 people attended an open meeting to review the 2015 flat sales season, hosted by the ITBA at Palmerstown House, Naas, on Tuesday, January 19th. Chaired by ITBA Chairman Derek Iceton, the panellists were Cathy Grassick, chairman of the ITBA Mare Owners’ Committee and a leading consignor, breeder and bloodstock agent, Matt Camacho, bloodstock director Racing Post, Jamie Railton, a leading flat consigner and pinhooker, Charles O’Neill, CEO of Irish Thoroughbred Marketing and John Lynam, bloodstock economist and analyst.

Jamie Railton had found that “the toughest year since the crash” wasn’t just applicable to Ireland and Britain and was mirrored in the USA, France and Germany. “The stallion business is very competitive and there are lots of incentive schemes, it’s very easy to be taken in by the hype.”

Cathy Grassick pinpointed: “We have a problem with over-production and a lack of reinvestment from yearling buyers. As mare owners we are not to forget we are producing for an end-user and not to get caught up in the spin.”

When trying to establish a young mare, Railton recommended covering her by a proven stallion. “Establishing a mare is a five-year plan.” Using good quality proven stallions on young mares was also advised by Matt Camacho. Grassick’s advice was to look at the stallion’s book: “Is your mare in the top 50%?”

SALES

John Lynam analysed the 2015 sales, saying: “ITM played on the weakness of the sterling and quite a few people spent more in Ireland than they therefore did in Book 2. Rabbah Bloodstock cut its expenditure, which had a negative effect.

“I’m old enough to have seen two lots of over-production and the signs are there again. At the foal sales, the Goffs median fell by 19% and the Tattersalls Newmarket median fell 20%. The number of foals to make at least €50,000 at Goffs increased by two to 147 and at Newmarket the number of six-figure lots increased by 13 to 77, so there was demand for nice stock.

“Both companies had to put on an extra day to accommodate the extra numbers. The median on the first day at Goffs was €5,000 with a clearance rate of 65%. At Newmarket the median on the first day was 3,000gns with a clearance of 67%. That’s an emphatic rejection by the market. If we exclude the first day’s trading figures, the Goffs median for the sale would have been unchanged at €22,000 and the Newmarket median unchanged at 25,000gns. This is not an opinion but a mathematical fact. The market does not support the extra numbers.”

STALLION FEES

Evidence indicated that 80% of mares who produced foals offered on those first days should not have been covered. “In all other businesses, if an asset is losing money it’s taken out of production.” He continued: “Stallion fees have rocketed. In Ireland, the number of stallions with a fee of at least €30,000 has increased from 12 last year to 17 this year. Most popular stallions cover large books, which will lead to a lot of very expensive yearlings.

“Over-covering your mare is the crux of the problem. The temptation is to pay more and use a good stallion, but if she’s got a light page you will lose. Ask yourself how much would you pay for a nice yearling from her and calculate the stallion fee backwards from there.”

Charles O’Neill discussed the role ITM plays in targeting buyers, identifying Britain as Ireland’s biggest market. The introduction of a voucher, redeemable at Irish sales, to any winner that was purchased in Ireland will target emerging markets.

LOSS OF OWNERS

A problem highlighted by the panel was the loss of owners at 17% annually. While owners of four horses or less decreased, the number of those with five or more increased. “It’s obvious which part of the market they take more from,” Camacho concluded as all agreed more should be done to improve the raceday experience. Lynam suggested research was needed to investigate why so many owners drop out.

Fiona Goor gave a presentation on the Plus 10 Bonus, which pays €12,500 bonuses to winners of Plus 10 races, shared between owner, payers of the scheme’s first two registration stages (breeder and/or pinhooker) and trainer, jockey and stable staff. Eligibility for the Plus 10 Bonus is “one of the boxes to be ticked at the sales”. It will shortly be confirmed that breeders who paid to register foals will be honoured if subsequent purchasers do not follow through with registration.

WIND CERTIFICATE

Questions followed, Amy Lynam asking if stallions should be restricted to only those sound of wind. Derek Iceton advised: “When you go to see a stallion, ask to see his wind certificate.” John Lynam added: “If you buy a filly at a horses in training sale you are allowed to ask for a wind certificate and return her if she is not sound of wind.”

Another tip came from Iceton: “The best investment you can make is a copy of the Return Of Mares, it gives an incredible insight.” He also recommended obtaining an extended pedigree from Weatherbys.

Should sales companies accommodate extra foals, is it a service to breeders, asked some? Nick Nugent, Goffs, believed “sales companies have a duty of care to provide an outlet”, but Simon Kerins, Tattersalls, suggested: “In reality, you may be appeasing these people when it comes to entering their horses, but if their horses are not viewed and are unsold they leave with a sense of disappointment.” O’Neill advised on a Plan B. “If the horse is led out unsold, put a small syndicate together and help make the mare by racing the horse.”

Gerry Duffy reminded us: “The key to any breeder’s success is in growing the end-user and that needs to be our focus.” He suggested tax incentives for horses in training, something the ITBA have been working on.

A final question was whether total prize money could be better distributed between winner and placed horses.

O’Neill responded that plans were in place to increase prize money down to fifth place.