John Sikura is absolutely right on the money! That is what we,small commercial breeders have been saying for a long time. We try to bred quality, nicking, etc and when we can't get the individual sold for whatever reason, it's almost impossible for most of us to carry those individuals to the racetrack due to the day rate.

It needs to either start with/and better purses or adjusting the day rates everywhere. Despite the workers comp., the vet, blacksmith, markup all around needs to be reduced if we want this industry to come back, attrack new owners/breeders and excel. Before we know it tracks will be closing everywhere due to lack of horses to fill races. From MSW, Stakes, and Clamiming, there is always the right horse to fill the specfic race.

I couldn't agree more with Mr. Sikura!  The entire point of breeding racehorses is to race them.  There are way too many breed to sell operations who don't ever want to run a horse.  Why don't they want to run a horse?  I believe it's because of the costs of taking a yearling and making into a racehorse, let alone a profitable racehorse.  The game is shrinking and we need bigger pots and lower costs to get back to the good ole days of racing.

Sikura is absolutely right. I race in NY, and it takes purse money of about $60,000 a year to break even -- more if you use top-end trainers like Pletcher or Mott.  With allowance races at $45,000 or so, that means winning more than two a year.  Only a minority of horses do that.

Nationwide, I'd estimate that owners earn less than half of what it costs to support their race horses, and that's not counting what they pay to buy or breed them.  Hell of a business!

Amen, Mr. Sikura.  You hit the nail right on the head.  The problem could not have been stated more clearly.  Now, the question is what are we as an industry going to do about it?

Someone makes money.  Soon there will be persons besides owners and partners who aren't making any money.  There won't be owners and partners to pad their wallets.  I know all about that personally.

I'm in complete agreement with Mr. Sikura's assessment of the problem(s). Here, though, is a case, unfotunately, where a grasp of the cause(s) benefits little in finding the solution. The engine is driven by pari-mutual handle (somewhat indirectly by Racing's relative popularity). Expenses are, what expenses are. Fewer horses competing + larger handle = greater purses/horse = (approx.) 50/50 chance of breaking even. The states have no motivation to alter the % handle structure, and there is no easy Rx to appreciably increase handle...Racehorse ownership cannot be argued/supported from a business perspective.  

I think John is 100% correct. That is why I have moved everything to Argentina and Chile. In those countries we pay the trainer, the blacksmith and the Vet for under $1,000 per month. The entry level is lower and the purses are very good in relation to expenses.  The numbers work and there is a very good market for export of proven horses. Here we pay a year's training with a maiden win.

I agree completely. However, don't forget Stud fees (make it a 50% reduction), vet fees (make them comply to a universal fee schedules dictated by a vet committee.  And the most important thing, treat the bettor as the most important part of the game - which he is. Get to that point, and a man may find it more reasonable to race a horse and have a chance at making a profit.

I agree completely. However, don't forget Stud fees (make it a 50% reduction), vet fees (make them comply to a universal fee schedules dictated by a vet committee.  And the most important thing, treat the bettor as the most important part of the game - which he is. Get to that point, and a man may find it more reasonable to race a horse and have a chance at making a profit.

Comments hit it right on the bullseye.  Purses are too low for how high the expenses have become.  People who used to buy are now selling (pinhooking etc) in order to lesson the losses from racing.  Guess the hard part is how in the heck do you fix the issues, cant see how purses can go up with handle dropping, only simple thing is expenses must come down, but trainers probably need an eye opener (empty stalls) for that begin.

I agree absolutely with Mr.Sikura! I would like to add that we might be able to ameliorate the purse problem if the money we currently have was distributed more evenly. We could have $80,000 maiden races  at Belmont and Keeneland if the purses for the top stakes races were reduced, or perhaps sponsorship was required for the top 50% of all stakes money. We  need to make it more feasible with the amount of purse money we currently have for an owner to break even with a useful horse,not just a stakes horse.

Cynthia McGinnes,Thornmar Farm,Chestertown,MD

Hi John, I think the trouble in how breeders have come to breed for the sales as opposed to breed to race lays right at the foot of the big stallion farms in Ky. As it became so unprofitable to race, those big farms abandoned their racing programs, and just became marketing companies, marketing Stallion Seasons, Boarding, Vet services, Farrier Services, and then pay us more to sales prep and a commission to lead that foal in the ring. The only thing they advertise is the sales prices of the stallions foals, or how many millions of $'s they sold at the sales as consignors.

Do these big marketing Co's own race horses? Hell no.. They are just parasites on the sidelines, sucking the pockets dry of the new owners who come into this business wide eyed with the wallet open. Tell us John, do you own runners?  

Mr. Sikura, we are running MSW races in the Great State of California at the great race place (aka Santa Anita) with a $36k purse. As an owner I am livid when I read comments like the horsemen have been supportive. I assume those supportive horsemen are the ones that sign at the back of checks at the end of the month. As an owner I am planning on leaving the State and race where commonsense rules. Can you say WOODBINE, CANADA. The industry desperately needs new leadership.  

PLEASE...JOHN WE HAVE HERD ALL THIS FOR FIVE YEARS ON THE NET...LET ME TELL ALL OF U WHY OUR NATIONAL TREASURE IS HURTING...AFTER THE TRIPLE CROWN EIGHTY PRECENT OF AMERCIANS THINK T-BRED HORSE RACING IS DONE FOR THE YEAR!!!..."EXPOSE IT & THEY WILL COME"...EXPOSURE...EXPOSURE...EXPOSURE...GOTTA HAVE A FACE...GOTTA HAVE A MOUTH...WE LOVE THE HELL OUTTA THIS GAME...LONG LIVE THE KING BABY!!!...

Not to mention that many successful RACEhorses are retired way too early thus decreasing interest in the sport which decreases handle and in turn decreases purses.  the owners/breeders have shot themselves in the foot.

We WERE small owner/breeders.  One yearling left here, we are OUT after 10 yrs, and ALOT of money.  

We lost money that we couldn't afford to.  Small farm, we did all the work ourselves.  We

should have gotten out sooner!!

John is right!  We loved the sport.  It isn't enough.  

For example, we had a horse who was already trained, & sent him to Finger Lakes with a top trainer, and got a 2nd, then a 5th that month.  In only 30 days training, we owed the vet alone the amount of the purse money won, and had to pay the trainer out of pocket.  

We all know horses don't win all the time!

Horseracing has become a sport for either the elite at the top, or people who need a deduction on their taxes because they are making too much money.

John, you are out of touch with reality. Purses are good at different racetracks because of the relationship with racetracks and casinos.  The purses need to be lowered on the low claiming races and that money redistributed for the higher claimers, MSW, ALW, and stakes races.  As far as expenses, the higher the purses, the more a trainer is going to charge you.  You know that.  Stud fees are way too high in Kentucky and you and your contemporaries continually overbreed.  Come on, stallion books of 140-160 mares?  Remember, quality not quantity.  "Big books" for the auctions is ridiculous, i.e. the upcoming 2 week long November Breeding Stock Sale.  I feel sorry for the consignors in book 6 and 7.  You are a seller.  Do you ever turn down a breeder and his broodmare because of her lack of pedigree, race record or production?  Also, the boarding rates in Kentucky are way too high.  Look at the amount of business your state is losing to PA.  You, your fellow horsemen and the KY state legislature need to figure out how you will remain "competitive" in our current "economic" climate. John, you are the industry, you are in KY.  Look within for your changes and answers.

Want to improve purses?  Raise handle.  Unfortunately, consumers are taking their money elsewhere.  Sikura believes the downturn in the economy is a a convenient excuse for the problems in the horse market.  Well, I believe the economy is an easy excuse for the downturn in handle.  Racing is a sport that has been deprived of stars; tote security lags; drugs have undermined the confidence of bettors; post times overlap; and there are too many small, unappealing fields.  Fix the betting product, and it will improve the condition of the breeding industry.

Absolutely right. And we have ourselves to blame, although in many states, Kentucky included, our efforts are sabotaged by egomaniacal politicians. Keeneland has great purses, but it is a unique track and open 6 weeks per year. I have been in the Thoroughbred business for 30 years and we have talked about how to market our product to new people perpetually with little results. Keeneland does a great job at marketing to the under 30 set and is helped by this being a college town, and it is the place to be seen on the weekends. But everybody in all demographics has less disposable income nowdays so they bet less, but at least they come.

I have not been to Turfway for years. I can watch on television in my living room, so unless I have a direct connection to a horse running I am not going. But I do not bet from home nearly at the level that I might if I was actually there.

I find when I talk to "normal people" that they are fascinated by horse racing but are somehow not "hooked" by marketing to actually go or attend. We have a star now in Rachel Alexandra and we as an industry need to promote her to every one we know or talk to if possible. Take a copy of one of the racing periodicals, including this one, to your next doctor or dentist appt. and "accidentally" leave it in the waiting room. Leave one in your break room if you work in an outside job. I have done this and people have come up to me loaded with questions. Make sure it is a good one, doesn't have to be current. One with Rachel on the cover. I have many fan links to horse sites on my Facebook page. A GREAT way to market without a lot of cost. Social networking is a must to the under 30 group. Call or email your local representatives and senators. If they are not racing friendly, ask why. Do your part and maybe we all as individuals can help. It is for our own survival as well as the industry we all love. Grass roots endeavors are our future.

Only a fool would own a racehorse in America. Unless you're Jess Jackson, who buys his at full retail and pretends he's actually done something. The entire industry sucks blood out of the owner; Kentucky being the poster child of greed. The demise of the business is a shame. It also well deserved.

Also, stud farm owners, please limit your books. Make your stallion unavailable. That market needs to readjust. If the Jockey Club were to allow artificial insemination but limit the number of foals registered to each stallion to say 80 then farm owners would not have the high expense of running a breeding shed, etc. They could charge a reasonable stud fee without the huge labor, facility expense, etc. Stallions could get a chance at smaller farms in Kentucky without the huge expense. There would be more stallions in the state, a good thing, and they would not be moving to Pennsylvania. The good stallions would command a firm stud fee, the law of supply and demand. Right now at some farms they breed close to 200 mares and every fee is a different deal depending on who you are, who your mare is, how many mares you want to breed to the horse, etc. Before the larger books became the norm there were a max of 40 seasons available to major stallions. The traditional number of shares when a horse was syndicated then was 32. Protect your product, stallion farms. Supply and demand and help the industry when you can. You may have the hottest stallion in the world right now, but if he dies tomorrow will you have that income? AI would also benefit in that way...suppose each stallion is allotted 50 foal registrations for exactly 5 years after his death from frozen semen. Farms could plan 5 year forecast and not be so financially devastated. They can risk there initial investment a bit more knowing that they have that to fall back on. Your horse might live a full and successful career, like Storm Cat, or maybe you might have one suffer the fate of Saint Liam and die young. If the young stallion is successful but is dead before his 2yos hit the races, how popular do you think your five years of available seasons is going to be? I don't know if the Jockey Club considers these alternatives...but everything needs change and we certainly need it now.

math all wrong for finger lakes assumming bottom claimers $8500 purse 2nd=$1700,5th=$170 total=$1870- expenses $370?=$1500 vet bill $1500? trainers charge $35to $55 day rate

Well I think John Sikura has many valid points as do the others that have commented.  However it does not explain the situation in Ontario where our recent yearling sale in September suffered major declines in spite of Woodbine having a very lucrative Ontario Sires Stakes programme and one of the highest purse structures in North America.We both breed and race - wish I knew the whole answer.

It seems like people have forgotten that this is a sport that was once called 'The Sport of Kings'. Why was it called that? Because for most of it's history, only people as rich as kings could afford it. Horseracing is a sport founded by and supported by people with plenty of money and it is littered with stories of those people loosing so much money that it hurt them. It's only been relatively recently, the last 30 or 40 years, that middle class people have even been able to participate. The idea of partnerships was to get more middle class people involved. This is a sport of dreams, but for most of us, not a sport to depend on making enough to live on. The industry as it nows stands is not sustainable and never has been, it was just that there was enough money to push around to cover that fact up. Now there's not.

Poor Mr. Sikura may never write again. He has opened Pandora's Box and has even had aspersions cast at him. But, he raises a fundamental question. Few will pay to keep racing going unless they can make money or break even. Too many people have their hands in owners' and bettors' pockets. Mutuel handle may be down now and may never come back; but I think it can. Bellwether is right that exposure is needed, and that is by television and radio and using them to build fan bases. If a large enough fan base can be developed over time, people will likely show up for big races and bet a little. Then, IF they have enjoyed themselves, they may come back once in a while on a convenient date for smaller races. A large enough fan base doing that could increase handle. But other things need to be done to make that successful -- a genuine concern for the athletes, equine and human; very close oversight of racing proprieties like uniform and strict medication rules; and honest commentary on races and people involved in racing, for example, I could not believe the TV commentators asserting that Vineyard Haven should NOT be taken down in the King's Bishop. Americans are extremely short-sighted, but they are not really stupid. That is true of bettors and owners; if they are kicked around enough, they will not return. That has happened and now industry participants are asking "what happened?" There is probably some time to renew the sport, and maybe this is even a normal cyclical downturn which will right itself. But the failure to grasp technologies like TV 50 years ago, or night racing until the last few months or so, shows that the sport's controlling bodies do not have much business sense. I don't expect it to change. Ideas like limited artificial insemination (AI) may make a great deal of economic sense, but if there is a choice between efficiency and losing thousands of good, useless jobs, what do you think the politicians and bosses will choose?

Thanks, John for your input.  As a small breeder we raise the majority of our horses to "race" and one or two a year to "sell."  We are losing money left and right on expenses, but doing everything we can do to cut costs (raise our own hay, mix our own rations, even start our own colts)- NOT quality.  Our industry needs to do more to bring people to the track.  We have spent countless hours hauling to the next track talking about all of our ideas to increase crowds and handles.  But there is no one to organize it and get these things going.  Look to some of your small time tracks that had handles and attendance up this year.  We do need a voice!  An organized voice, we need marketing.  

So says the man who bred Indygo Shiner to 168 mares last year....

Mr. Sikura makes some valid points. Once upon a time, farms bred to race and sold a few as well - in other words, they bred racehorses. Too many now breed largely "show" horses, ones that look good in the sales ring and draw high prices but might not be fit (or fast) enough for performance. Form should follow function, which would help horses with sound conformation and physiology to be the ones in demand. Personally, I don't care how elegant he looks as long as he can win races and stay sound for a few years before going on to add his proven quality to the gene pool. I have to think about The Green Monkey here. He brought a mighty price - but unless he's a whizz in the breeding shed, he will have been a $16-million white elephant. If we get back to breeding for the track, not the sales barn, expenses, prices and soundness just might come back into line.

I agree with lots of the comments in various posts above. As well as Mr.Sikura's comments BUT when it gets right down to the crunch the cream will rise to the top. If a horse can't win a couple of races a year then it's only an average race horse in whatever level it runs.

Many times the horse is running in levels above it head. If it's running maiden allowance and not winning within a few starts then either the trainer has to look at how the horse is placed in either distance,company,surface etc.

Too many variables in all levels of the industry to just say purses need to be raised.

We in Ontario have great purses at Woodbine but check the list of statics. Not many horses win more then 2 races a year thus the cream does rise to the top.

There is not one issue to blame with what's ailing our sport.  In no particular order:  high stud fees; terrible marketing; excessive breeding resulting in too many horses of poor quality; declining fan base; and declining handle and purses.  We also need to realize that this is a SPORT and just like we tell our kids that not everyone is going to become Michael Jordan, not everyone is going to become ? on heck, forget it, no one ever gets rich racing horses ... stick with basketball, kid.

LONG LIVE THE KING???...LETS GET THIS STRAIGHT TOO..."THE HORSE" IS THE KING FOLKS...BAR NONE...

Speaking of The Green Monkey, I bought 50% of a race horse at Philly Park for $5000 and she won one more race than The Green Monkey.  Life is funny that way.  The cost to train a race horse is not at all funny.  Where is the leadership in this sport?  Are they all so busy trying to get the edge on each other that they don't see that the sport is dying?  Don't get me started on Kentucky.  The Derby Museum will be all that's left in the state in 2030.

Dear Cynthia McGinnes,

Did you really use the word "ameliorate" on a horse racing blog?  Why use a large word when a diminutive word will do?

Eric,

No, the math is right for Fingers!  (see above) Vet bill was

$1200 appx. for 35-40 days!!!!!!!  The trainer was about the same.

I just wanted to make a point, no horse wins all the time, you just can't get ahead at a smaller track unless you are the owner AND the trainer, even then it is a crap shoot!!

Breeding, I could write a book.  My advise is don't try it unless you have a vault full of money you don't care about!

And, this is in NY state, with a better breeders program!

The problem is "no residual value" for racehorses.

The solution is to "mandate" a maximum number of mares bred to any and every stallion, immediately. Reduce the supply of a stallions offspring at auction and the residual values for his get will rise. Those that can get a mare to the limited book of a good stallion stand a chance of making a living in horseracing.

Adjusting purses will only help until the cost structure follows the purses up.

The Ashford experiment of huge books has run its course. We need to return to a model of controlled supply.

Interesting reading - but unless the 'racing powers that be' are willing to confront the issues honestly and openly, all of this is an exercise in futility!

In defense of the Green Monkey - I saw him run at Belmont and I thought he made a credible showing.  His conformation looked great, he truly is beautiful and his pedigree is very good, so what has gone wrong - handling him?  I think of Seabiscuit when I think of the Green Monkey.  I could be wrong, as I'm just human, but I don't think he was given enough of a chance and was rushed off to the breeding shed to recoup as much of the $16 million as possible.  Hopefully, should he not be successful in the breeding shed, he will not showup in a 'killer pen'!  Cut him a little slack folks, he didn't ask anyone to pay $16 million for him!!

ARE YOU KIDDING ME?  THESE COMMENTS FROM STALLION MANAGER THAN ROUTINELY BOOKS HIS STALLIONS TO 200 MARES...OH THE HYPOCRISY!

Just a thought for the many elected officials who are supposed to represent the owners interest.  Why don't you guys try getting UNIVERSAL HEALTH CARE for the horses. Maybe that would be a good start to increasing new ownership? The Vets are out of control.

John, I know you must have read the comments here, I ask a simple question, how many race horses do you own?  

Mr. Armstrong-Yes, the fact that relatively few, when they're done racing have any "residual value" is a problem-and one not easily solved. Let's face it, racehorse retirees must compete with many other horses available. As to residual value in the racehorse breeding marketplace, it goes back to the fact that racehorse breeding/racing is essentially an unprofitable enterprise. Limiting the size of a stallion's book would do little to change any of this. This, in itself, should have no affect on the total number of horses bred. Yes, reducing the book size of the highly commercial stallions would raise the value of their untried get (not their "residual value"), but would do nothing to raise the value of the combined (untried) population. It's just too bad that those at the top of the market are now experiencing some of the hardships that the rest have suffered for so long. Welcome to the club.      

John,

How many mares did you breed to Candy Ride, Indygo Shiner, Roman Ruler, etc?  Need I go on.  I hope you'll answer this question for the readers of this blog.  While I'm sure your concern for this industy is sincere, I can't help but be amazed that someone who has deliberately contributed to the incredible overpopulation of the breed would actually have to nerve to now be "concerned" about the lack of sustainability!!  Where was your concern the last 10 years?  Talk about too little, far too late!

Is this another one of those moments where horse racing insists on the absolute virtues of the free market (for example the right to card as many races as you can fill, restrict access to signals to try to maximize corporate advantage, book as many mares as you can manage at the price, etc.) until the system collapses from its own inflation and then, shock, it's time for welfare again?  Where are the dollars to subsidize racehorse production?  Why can't breeders continue to take a share of bettor's risks?  Heck, let's get people to bet on other things and use the money from there (slots)!  Racing is home to the craziest libertarian socialist arguments I've ever heard!

John's points correct and valid. The most important issue that needs to be addressed is the purses. I feel less racing is the key, preferably three or four days a week without adding races per card. This would create larger fields, more handle and greater purses. The major racing jurisdictions would then have the ability to use stronger quality races.

As far as stallions that breed to large number of mares, that is called simply supply and demand. If the stallions are priced fairly their books have greater demand!

Sceptre

While your points are well taken, the overarching problem, at the moment, is that virtually no one is making money. Yes the blame can be spread around, but a change needs to take place and it needs to happen fast. Probably the first thing that will change will be stud fees (as breeders either liquidate or press for very low prices). My concern is that low prices for matings combined with large books still leaves every breeder in a pickle. Reducing the book sizes is integral to returning the breeding business to health at all levels. Ultimately it should improve residual values, although more gradually (this is due to the tremendous inventory already in place of mares by every different stallion from the large books we have seen over recent years). In the short run, reduced stud book sizes will inspire more confidence on the part of all breeders to mate their mares rather than liquidate.

John is certainly right that the game is not even remotely affordable for owners, but how do you improve that? You can't simply ask for higher purses when there already isn't enough money to go around. The best solution is to get the horses back to where they were 25 years ago, making twice as many starts. If owners magically had that overnight they would earn the same purse money but have only half the horses in the barn and half the expenses. An immediate improvement in economics. How do we get more starts? Ending race day medications such as Lasix and bute would be a good start.

There was a time when it was considered common sense to not be involved in agriculture unless you wanted to work in the field.  The horse business is a hands-on business.  If vet bills are so high, ask why; were you there at the time, taking the horse's pulse?  Did the trainer actually get enought to cover his expenses?  Was he asked to put in the time in order for an average horse to show that it was...average?

As for overproduction, no doubt that is true, but who will tell someone not to breed?  Market forces are sorting themselves out, and those losing money will stay out.

The bettor drives the show from the windows, and advance deposit wagering isn't donating to purses.  Takeout is far too high.  Although it is the horse which we extol, our product is not competitive and is overtaxed.  The owner doesn't stand a chance; ever notice how the day rate consumes all the purse money, everywhere?  Everybody wants the big bucks; nobody wants to work.  Such a fine mess...  

Dear LCM.. He (John) has no intention of answering our questions, mine or yours.. he is the problem..

Wow this group gets fired up. To answer a few of your points, I have 15 horses in training so I do support my point of view about a responsibility to breed to race. We do not race in Ky, as i find the purse structure in other jurisdictions to be more lucrative. Of course the legislature in Ky has failed us and both mares and stallions are leaving the state. With respect to the criticisms about the number of mares we breed I think the results of our stallion operation speak for themselves. Candy Ride, Medaglia D'Oro and Roman Ruler, Stormy Atlantic have all rewarded their supporters and become significant sires. Your point that we breed in excess of 200 mares is incorrect. We have never done so. We do subscribe to the theory of reasonable stud fees so that breeders can make money when selling their yearling. Ever thought thats why a stallion covers alot of mares because he is successful and stands below his market fee?   The reality is that breeders want it both ways. Don't raise the price, limit the book but let me breed 6 mares to your sold out stallion. I have committed to limiting our books to 100 mares if breeders would agreed to support the stallion for the first 4 years at stud. You do realize that stallions are purchased and the return of the purchase price comes from selling seasons right? You also know that payment terms are now stands and nurses and that alot of fees are not being collected dont you?Lets make that deal, support the stallion until his 2 year olds run, not going to happen. You want the most popular stallion but won't breed to a stallion with coming 2 year olds and will move your mares from freshmen sire to freshmen sire. There is no breeder loyalty today. Its all about fashion.Roman Ruler bred 37 mares last year before his 2 year olds ran. Where were you when we needed you? Stallion owners and breeders need to be part of this solution. We are reducing our books and mare owners need to spread their mares around. Both sides are part of that solution. I make my living in this business and welcome reasonable criticisms as i want to do my job better.  john g sikura

Dear LCM/ I answered you in my general response. But specific to your criticism i would ask if you are a breeder? If so you probably had 10 people call for a Candy Ride season last year. Do you breed to a stallion that has coming 2 year old's?. If you are like most breeders the answer is no. You will move your mare from freshmen sire to freshmen sire and shun older proven racehorse sires. You want reduced books without breeder loyalty and under market stud fees.It is a nice problem to have to much of what people want. Want to trade for a little of what nobody wants. Go sell a Medaglia D'Oro next to a stallion that just left for Ohio, I don't like your chances. Without a strong first book of mares a stallion has a limited opportunity for success. Additionally without significant number of live foals in the first crop a stallion owner cannot survive the lack of demand in the second and third year. Again I repeat my offer, we limit breeding 100 mares, breeders support the horse for the first four years at stud. That is a fair deal for both sides but not going to happen. We have reduced our books considering all of the factors above including the breeder. Just remember when i stand 12 stallions i cant sell seasons to the 3 horses in fashion. Had you supported Medaglia D'oro, Candy Ride and Stormy Atlantic i bet you would feel that you breeding at Hill'n' Dale was a good choice. The fee was more than fair and they welcomed my business when another competing farm thought my mare was not good enough. And by the way, the 2 year old i loved out of the mare just won a stake. I hear that alot, thats why people breed to our stallions to catch a rising star. You know there is a different approach employed by farms. The stallions stand for double what they should and breed half the mares. Might want to try that route. john g sikura

Great commentary. The real reason racing is spiraling downhill and the purses are too low is the 2.00 bet and 20% or so take. In the day the 2.00 bucks on a 2-1 shot paid for the day. Lunch, a train ride to and from and a program. Now it buys a slice of pizza. Want to fix racing and get new blood, make the minimum wager 5.00 or 10.00 on WPS and reduce the takeout to 10% and devise other props from the results. Take on the casinos with the product itself and leave slots out of it. In the end its all about the bettor experience.

Mr. Sikura,

Since the likelihood of increased purses is somewhat in doubt at least for the near term ( e.g. $80,000 maiden special weight and first condition allowance races in New York and California) what is your opinion on the industry putting pressure on or regulating racetrack vendors in an effort to lower the cost of owning and racing a thoroughbred?

Hi John, I owe you an apology as you do have horses in training. As you know most stallion farms in Ky do not. I believe it is very important to limit books, but I think it is by being selective as to the mares accepted to stallions. Look at hip 466 in the OBS August yearling sale, sired by Macho Uno, not a runner in 4 generations. Where will this horse end up? Why would they accept that mare to him? GREED! Another horse headed for the killers most likely. There should be some criteria per the female family of the mare before allowing her to reproduce. While we own stakes fillies, we own mares that are maidens, but are half to big producers, solid stakes horses in the last 4 or 5 generations.

If you don't mind it would be fun to stable mail your runners, lets see how well you do. Once again please accept my apology, Greg Robertson

Dear Mr. Armstrong,

Firstly, I am aware of your name, and I also have been in this business for a very long time. By the way, more than a few years ago I had some interest in acquiring your Majestic Light mare...My purpose is not to debate back and forth with you, but your specific topic is worthy of a bit more analysis. It's likely that many feel similarly to you. Would you agree that reducing book sizes would not reduce total (thoroughbreds bred for racing) crop size? It would merely create substitutions to other stallions. As said before, reducing book sizes should inevitably somewhat raise the average value of untried offspring from those higher end stallions. It could also, however, cause those stallions' stud fees to rise (note Mr. Sikura's recent comments), or cause the "residual value" of high-end male retirees to decrease. Reducing book sizes seems not "to be integral to returning the breeding business to health at all levels", but rather, perhaps, might make it more "healthy" for just those at the high end. If you factor in the aforesaid potential rise in stud fees and/or relative loss of residual value to the elite male retirees, it could end up as a wash for even those at the high end. I'm not an advocate of excessively large books, but for reasons differing from your own. Large books prevent lesser known stallions from receiving sufficient numbers of mates to reasonably evaluate their genetic worth. The average breeder, even those at the high-end, are often not sufficiently versed in racing or breeding to make the proper decisions regarding the mating of their mares. They, therefore, tend to go along with the crowd, so if the vogue stallions are readily available to them, they look no further. This, in the long run, could prove detrimental to the breed, and may reduce somewhat genetic variability. All this, though, has little to do with the topic at hand. While you claim that your suggestion would be for the betterment of all, it should produce nothing positive for any except, perhaps, the high-end market breeders. Should I infer yours is a "trickle-down" logic (a la Reagan economics)?          

John,

Thanks for responding to my comments and questions.  I realize the reasoning behind your decisions.  They are "sound business" decisions regarding making a profit for yourself and your stallion shareholders, however, they do not in any way shape or form help this industry when it comes to overpopulation!  While you may see setting stud fees at socalled "reasonable" amounts to attract a larger book, that does not create a better book. What ever happened to stallions that got over 10% stakes winners to foals? Now anything over 5% is considered "good"...how pitiful. You also failed to state the actual amount of mares those stallions mentioned bred.  And as for the issue of breeders jumping from freshman sire to freshman sire, I actually prefer breeding to older, proven stallions.  I know I'm not in the majority,  but I don't prefer to turnover my mares the way most breeders do.  I realize the nature of this beast when it comes to commercial breeding...that is the problem..the breeding is based almost solely on financial returns instead of doing what's best for the individual horse and in turn, the industry.  Maybe this business does need to go back to being primarily run by the elite and super wealthy.  Does anyone want to hear that...no, but it looks like it will eventually turn that way.  Look at the sales in Europe for proof...the Arqana sale average was UP!!!!  Now how did that happen...Simple it's a SPORT there..a sport for the truly wealthy that don't NEED to get their INVESTMENT back...because it's not an INVESTMENT...it's a PASSION.  As one of the leading stallion managers in North America, I hope you make it clear to potential "customers" that there is no guarantee or even implied guarantee the the money that is put into this industry will be either returned or increased.  I'm sure thats not the likely sales pitch given most newcomers by you or the majority of industry insiders.  Everyone talks about the "homeruns", etc.  It's not easy to entice someone with "hey want to spend a fortune and enjoy losing it?"  Somehow it's working in France.  Viva la difference...oh and one other thing..I was very sad to see that Shakespeare couldn't make it here in KY....He was my favorite horse in your stallion barn last year...what a shame.

John,

You asked where was I when Roman Ruler needed mares...well I was sending my mare to another first crop sire who NEEDED mares, because I felt the breeding suited my mare best.  I knew it wasn't a "smart" decision based on the nature of the marketplace, but I'm willing to keep the foal and race it (do I hear a gasp).  One other aspect that I want to mention is the perpetrators of this BIG BOOK mindset....COOLMORE...Just look at their American roster...it's power has dwindled every year. Most breeders I know are tired of being 1 of 50 yearlings at Keeneland...good luck being the 1 that stands out.  On the other hand look at the miraculous recent rise of Gainesway's stallion roster!!  Somehow poor little Birdstone is doing just fine and I'm certain all his entire foal crops combined don't equal one foal crop of the most "commercial" stallions at your barn, Coolmore's or Darley's.  If a stallion is going to make he will.  All the mares in the world can't make a bad stallion good....not for long anyway.

horse racing is a great sport.  We no longer have a purse structure to encourage most people to own horses out right so lets face facts. vets have improved conception rates. there are too many horses. i think that the jockey club should impose a limit on the number or mares that can have registered foals by a given stallion in a hemisphere. 100 seems like a resonable number. then keep the stud fees where the market allows them to remain and let those  who want out get the heck out. this used to be a sport for the elite, what is wrong with that? i dont here polo players crying about increased costs for grooms and vets.

BREED MORE GELDINGS...

Mr. Sikura first let me apologize on behalf of the people who like to come on these blogs and cut down anyone in the business with an opinion. It seems that it has become the norm on this website.

I do agree with your statements regarding purses. I owned in partnership a horse who ran on the community circuit here in Alberta. He won 3 races and placed in others. Between the day money and the shoer etc we pretty well came out even. It seems to me that every time the economy slows down that the people writing the bills jack their fees up. You can't tell me that a shoer at the racetrack every day is spending that much more on gas and shoes to justify the 30% increase in his services. My husband and I trained our own and outside horses and NEVER charged extra except PC on a win to run a horse over and above day money. I got bills all summer that showed a percentage taken off for a horse that ran out of the money. Now before I get slammed I'm not talking about the PC for a win, this horse ran up the track and we got dinged for them throwing a bridle on and leading him over. This was over and above day money which in my opinion should cover the cost of race day as there is very little expense for the 3 days he walks after the race.

The point I'm trying to make is that no one holds the line and the owner sees his purse money shrink thru this. No wonder it's getting harder and harder to get new owners into this business.

I agree with another poster who commented on Woodbine's program and their Ontario sired program. You know what, THEY get it!

I am glad to see this discussion. I am a small breeder/owner, John Sikura has always been supportive of our kind of operation. I believe the #1 issue is the most obvious one - with a few exceptions, the racetracks look like Ghostowns!  There is NO effort made to get new fans to the racetrack and recruit no owners.  Just 20 years ago it was the sport with the most attendance.  Today, the arenas are packed for Football, Baseball, Basketball, and Car Racing, with tickets going for $50-$200!  How hard is it to get couples and families to the horse races for admissions of $5-10?  When the crowds come back, the handles will rise.  New owners will be recruited.  Who wants to invest money for no return, especially in a dying sport?  The racetracks, like the rest of corportate America, look only at today's balance sheet, not the long range prospects for the sport.  They will make what money they can -- from online wagering and simulcasting, slots, etc. and "cut costs" by doing away with anything that makes the fans happy -- mutuel clerks, good food, comfortable seating, promotional expenses.  Their ultimate bailout plan is to sell the land for development and get out.  

Smaller books will mean:

- the top stallions don't get such a large percent of the business.

- less popular stallions will get more mares.

- each stallion's offspring would be competing with fewer numbers at sales; both the yearling sale and the broodmare sale

- this will make the better offspring and retiring broodmare prospects by a particular stallion even more valuable and buyers less picky when vetting racing prospects (fewer to choose between)

- lesser stallion prospects will have more residual value on a relative basis to the best stallion prospects.

- fashion won't be allowed to dominate production

If this is what you mean by "trickle down" then we are in agreement.

John, Cetewayo is an example of what you talked about in your article and your answer. By all rights, he should be doing much more business at stud than he is - good bloodlines, good race record, and racing for 6 years. But he's not fashionable so even though his produce would probably make very good racing prospects (he hasn't been bred to enough to know), they aren't going to pull the big bucks at the auctions so he doesn't get bred to. It's a vicious circle driven by breeders breeding to sell, not to race. Thank you for letting us know that you are involved in racing horses, not just breeding them. There are a couple of other big breeding corps. that also race, Three Chimneys and Adena Springs. Do most also race or is it the exception?