Standing a Stallion

[xfactor fan]

What are the economics involved in standing a stallion? This post is in racing because it sure seem like the money involved in studs is much better than that in racing. Which in turn is shaping how horses are raced and retired.

So..... How much would a super star 100,000, a mid-star 50,000, and a not-so-super star 1,500 make?

[photofinish]

Standing a stallion is incredibly expensive. Super stars and mid-stars make it ok, rest are e-x-p-e-n-s-i-v-e. Many farms chargs near training rates for standing stallions because of the grroming, conditioning, and liability involved in standing one. Advertising can run into the tens of thousands. Many farms require stallion owners to carry their own, additional ins. policies.
Then, to get a young horse going you will need several of your own mares (average stallion, anyhow) and have to raise and train those foals to help prove him. You will make any deal necessary to get as many foals on the ground as possible.
It's the hardest part of the TB world, IMO. The super-stars are few and far between.

[Dave C]

The super-stars are few and far between.

And a bundle of money was spent on them before they broke even.

[xfactor fan]

What I was trying to get a feel for is how the breeding potential of colts has influenced racing careers, and number of starts.

[griff]

That would have been an easier way to say it

griff

[Shammy Davis]

I'm not sure I understand what your question is? Are you asking about the impact of any colt standing or successful winning colts? Is age the determining factor?

[photofinish]

What I was trying to get a feel for is how the breeding potential of colts has influenced racing careers, and number of starts.

Basically, the commercial market has tanked the soundness out of the breed. The brilliant runners' values skyrocket off of a couple key wins. this makes them "too valuable", literally, to risk racing any longer. The stud fees don;t hold a candle to initial "syndication value" of a young stallion. If you have a colt who the commercial guys value at $25million off of a couple of the right wins, how could you risk that horse racing again? Vicious circle and the detriment of the NA Thoroughbred, IMO.

[xfactor fan]

That's part of the picture. Stud fees, syndication fees, other things that the owners stand to make from the stallion vs costs of keeping horses running, and I'd expect that would include insurance.

[Shammy Davis]

Xfactor: I see your point. It is a vicious circle with no end in sight.

http://www.horseracingintfed.com/resour ... s_2008.pdf

Here's an interesting TIME archive article on the subject that will reinforce your current thinking.

http://www.time.com/time/magazine/artic ... -1,00.html

Many states are turning to other gambling venues like slots to support purses, breeder incentives, etc. This is an interesting report produced for Maryland.

http://www.governor.maryland.gov/docume ... Racing.pdf

It seems apparent that horseracing, if it continues down the same road it now travels, will not sustain itself. It is no longer a question of the failure of one segment of the industry, it is question of when the entire industry falters.

Stallions are currently over valued like everything else in this economy. Sadly, that pushes the prices up at auctions. It is interesting in the mix of successful stallions throughout history there have been horses like Drone and Malibu Moon that large syndicates might not have wanted to stand. Two Punch is another one. The saving grace of the low to middle end stallion is that the percentages of success are getting better. Remember when Mr. Prospector was standing in FL.

When breeders begin to reinvest in stallions, only then will we see a greater variety of high-quality proven stallions and less of a monopoly of mares for the top six. If this doesn’t happen breeders have little else but their broodmares to bring in the profits. It’s absolutely imperative then that we get breeding right. Forget fashion: the most important maxim is to breed to a stallion that suits your mare. If she is a maiden use a proven
stallion. Base your selection not on the best price or deal you get but the best stallion that suits your mare.
The whole idea that buyers are only looking for early two-year-old types is absurd when one considers the distribution of prize-money in Europe is greatly in favour of the Classic distances. Breeding is an inexact science so do your research properly. Be assured that at the lower end of the market pedigree is less important; a good looking yearling will always get a bid.

http://ta-in.facebook.com/note.php?note ... nts&ref=mf


As usual you ask the difficult questions. Good for you.

[xfactor fan]

Ok, so getting a stallion started is expensive. But what kind of money can a mid range stallion hope to earn over his 15 year stud carrier?

I'm trying to get a feel for race earnings vs stud earnings.

[Shammy Davis]

http://therail.blogs.nytimes.com/2008/0 ... economics/

[xfactor fan]

Big Browns Racing earnings 3,614,500

Per the article that Shammy so kindly provided $44 million in the first four years.

Kind of a no brainer.

And this is the economic reality that is driving the early retirement of colts.

Not some type of mysterious genetic disease, not drugs, not trainers. Just cold hard cash driving the race careers of well bred colts.

[ireneinwa]

One in a million you'd get a return like that. Most states offer complimentry breeding just for a shot at stallion rewards.

[Fireslam]

I only skimmed that article, but if I read it correctly, it assumed that Big Brown stood for $100,000, which he didnt. He stood for $60,000 It also assumed all the seasons were paid seasons, which they arent; they did a lot of foal shares with him, and sold some seasons with serious discounts. They assumed he would breed 112 mares, stating that was conservative. In fact it was inflated, as he bred 104 mares. There have been 77 live foal reports issued, so the figures will be well below what that article would like you to believe.

[madelyn]

One in a million you'd get a return like that. Most states offer complimentry breeding just for a shot at stallion rewards.

So the state owns the stallion? Believe me, KY does NOT offer complimentary breedings. It has no stallion "rewards."