As the president and CEO of WinStar Farm, Doug Cauthen oversees a venture that sells some of the young horses it breeds and also shops at public auction for yearlings. Asked to talk about his expectations for the upcoming yearling sales he said the following:
"Like a lot of people, Im hoping the market is better. I feel like the last three or four 2-year-old sales showed that there was an appetite for horses. Our experience in March (at the Ocala Breeders' Sales Co. in Florida) and at Keeneland and in Maryland (at the Fasig-Tipton Midlantic auction) was that the market was quite a bit stronger than the previous year. We buy on a budget, trying to get new blood or support our stallions, and we got outbid a lot.
"Obviously, those horses were closer to racing (than yearlings) so that might have given them a little bit of an edge. But a lot of horses that were in the 2-year-old sales had been sold as yearlings for a lot less (than they brought as juveniles), so there probably was some opportunity for people to evaluate and say, ‘Hey, I could maybe have bought the same horse for half the money (as a yearling).'
"There will be fewer horses (in the yearling sales) this year, which will help. And when next year comes around, the number should be reduced even more. We all know supply and demand is a big piece of a puzzle and when that gets closer to the right balance, the sales are going to be better.
"Because the volume (of horses offered) is so much greater at yearling sales, they won't have improvent that is as good (as the juvenile auctions experienced) right away, but I think the market this year will be little bit better."
Asked about the situation commercial breeders will face this year because of the high fees they paid to produce the current crop of yearlings, Cauthen said:
"We're all in the same boat. Breaking even can sometimes be a victory when all you're really trying to do just get to the next year and the year after when profitability can occur. It is still going to be a tough row to hoe. Everybody, including us, we're all in survival mode and trying to get to (the point) where profitability can come back."
"What's coming and what's on the ground have got a lot more economic viability for everyone because of the lower fees people paid last year and, to a pretty good degree, the year before. I'm encuraged that there will be profits down the road, and we need that. We're all in this together. We sell seasons and we need the breeders to be successful."
