AT this time of the year, most breeders are weighing up stallion choices for the 2018 breeding season, if not already made, and looking forward to seeing new stock on the ground.
The outcome of the 2017 sales season should ignite reflection and influence future decisions with an honest appraisal of the quality of the stock previously produced by each individual mare.
If things didn’t go so well, consider is this part of an on-going trend indicating that you are producing a product the market simply doesn’t desire?
Perhaps additional marketing, production or different stallion choice or breeding goal could improve future progeny and return a higher dividend.
Don’t continue to repeat the same mistakes and yet expect a different outcome!
In reflecting on the public auction returns, it is important to bear in mind that the greater percentage of sport horse horses in Ireland are sold privately and the figures from public auction returns represent only about 25% (24.10% the 2016 figure in Contribution of the Sport Horse Industry to the Irish Economy 2017) of actual trade.
It is nonetheless useful to analyse public auction trade, and since the introduction of the select elite sales to the public auction forum, there is now a more accurate picture of the values attainable right across the spectrum.
A key factor to bear in mind when reviewing sales returns is the cost of production as this ultimately determines profitability, or otherwise.
This figure can be highly variable between enterprises, animals, and breeding seasons.
Variant stud fees; the need to acquire professional assistance in sales preparation or not; perhaps even land, building or machinery rental fees or loans on same may impact some enterprises and not others but should be factored into the cost of production.
Mare depreciation, sales entry fees, commission and veterinary costs are also variable.
Whether a foal is produced using natural covering, artificial insemination, the nature of semen used, or embryo transfer can also have a significant bearing on costs involved.
However, bearing in mind what are considered as minimal husbandry interventions (feeding, bedding, farrier; veterinary; dosing) and assuming reasonable fertility, Teagasc estimate the cost of production for the foal for auction to be in the region of €1,800 – €1,900 (non-select versus select sales) – and that of the three-year-old for auction to be in the region of €4,000-€4,600 (non-select versus select sales).
These figures do not include stud fee, sales commission, repayments/rental on fixed assets; mare depreciation, labour/professional fees.
Also, the veterinary fees included do not account for breeding with frozen semen or embryo transfer.
Barren years should be considered in the cost of production over the life of the mare as costs are still expended.
PUBLIC AUCTION TRENDS
An animal that appears on the face of it to have attained a relatively low return at auction may have reaped a better profitability than another with a perceived high return, dependant on the input costs prior to sale.
Using an Irish-based stallion may be a more prudent, cost effective choice for some mares than importing semen.
For some mares, the breeding direction should be carefully reconsidered if the performance heritage is not strong enough, as expending large sums on expensive high performance stallions may have negligible likelihood of producing a financial dividend.
Irrespective of breeding direction, the mare must still meet a basic standard of soundness, conformation, athleticism and temperament with good standards in production for the offspring.
It is important to be super critical of the mareline and performance achievements in making the decision on how much to invest in a stud fee, and the method of breeding chosen.
Don’t expect the stallion to compensate for too many deficits on the part of the mare.
For most breeders the aim is to sell foals, however, it is evident from the public sales returns that to do so with financial reward, demands a strong mareline, with plenty of performance heritage, as well as a reasonably correct and well produced foal.
The top 20 priced foals were all bred with the show jumping market in mind; all by continental sires, and all with imported semen with the exception of one colt.
The top end of the market saw a marked rise with a €1,075 rise in the average of the top 20% above 2016 figure, and a €225 improvement in the overall average on 2016 (see chart).
FOALS
The three-year-old market demonstrated a small €308 rise in the average return over 2016 prices with an almost identical average for the top 20%, and a €982 fall in the average of the select sales only.
Despite the absence of the Supreme Sale of Showjumpers from the 2017 sales calendar and the Brexit-weakened sterling rate, this age category showed some improvement in the middle market trade with the top end of the market holding its own, providing decent margins.
The select sales are performing very well.
It is interesting to note that on an average basis, the three-year-olds are failing to out-perform the foals.
The top 20% of stock generally are returning a better margin for producers when all sales are appraised but when the select sales are isolated for comparison, the foals are still winning.
SELECT SALES
The select sales continue to contribute very significantly to public auction turnover across the age categories.
The success of these sales lies in a combination of pre-selection and the focused marketing drive that accompanies them.
The availability of online videos is an exceptionally beneficial marketing tool that those selling privately should note and mirror.
It is clear that if the breeder is to invest in producing to four-year-old and older then the initial appraisal of stock must be very critical, with acceptable pre-sales preparation, X-rays, and high quality production with some competition mileage.
KEY QUESTIONS
Those breeders who attained average, below average, or no return for their products should consider their options now: