First-Year Sires: Lower Fees Prove More Realistic

By Nicole Sauer

It will be seven years since an entering sire in North America breached $100,000 for a first-year fee. Animal Kingdom holds the highest announced fee for the coming season at $35,000, the highest fee for any incoming stallion since Curlin in 2009 ($75,000). While many bemoan the long drought of six-figures entering fees as a sign of a slow recovering market, this small study indicates that these lower fees are a much more realistic measure of a new sire's potential.

From 1999-2000, 77 stallions have entered stud in North America with a fee of $25,000 or greater. Among those high-priced stallions were record-setter Ghostzapper at $200,000 in 2006, Fusaichi Pegasus at $150,000 in 2001, and Point Given at $125,000 in 2002. However, based on 2014 stud fees, the majority of the sires did not fulfill the expectations suggested by their high fees. The average entering fee of these stallions was $46,039; the average 2014 fee for those that are still active is -41% lower at $27,220. Only 22 (29%) will stand for $10,000 or more this coming season, and just 10 (13%) will stand in 2014 for a fee at or above their first-year fee.


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Nearly half of these sires are no longer active in the United States. While some have died or been pensioned, a large number (22, 29%) have been relocated outside of North America. Three of these sires were once the leaders by stud fee of their crop: Coronado's Quest led his crop in 1999 at $60,000, Came Home in 2003 at $40,000, and Empire Maker in 2004 at $100,000. The coming breeding season will be without recently relocated stallions Hard Spun (standing in Japan in 2014, entering fee of $50,000), Leroidesanimaux (England, $30,000), and North Light (England, $50,000).


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The leading sires by stud fee of each crop have experienced marked changes since their first year. Of the 12 original leaders, seven are no longer in that position and the remaining four have all experienced substantial decreases by 2014. Interestingly, of the six new leaders, only one (Giant's Causeway) entered for more than $30,000. New leaders Distorted Humor, Malibu Moon, Tapit, and War Front all stood for $15,000 or less their first year.


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Had Animal Kingdom raced 10 years ago, his historic wins in the Kentucky Derby Presented by Yum! Brands (gr. I) and Dubai World Cup Sponsored by Emirates Airline (UAE-I) may have merited a six-figure stud fee for his first year. But the current economy has changed significantly since Ghostzapper, Smarty Jones, and Bernardini entered stud. Even so, while $35,000 may seem modest, the stud performance of past expensive young sires suggests the current market's lower fees are a more reasonable standard for an incoming stallion.

5 Comments

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sceptre

The raw data you offer is a good and true history lesson for all to read. I don't, however, agree with your basic premise/conclusion-that the present "economy" (or a better realization of the facts offered here) is the cause of these relatively lower first year fees for the higher profile prospects. I've heard and read the opinion expressed here before, and have been waiting for the opportunity to dispute it in "print". Part of the cause for these more recent lower first year high profile fees may be due to the greater book sizes of all high profile sires, but I feel the main reason is that these more recent year high profile prospects do not have the same perceived "status" (going in) as many from years before. Most of the former just don't stand out as some did from past years. I am rather certain that if they did you'd see stud fees quite similar (but for the increased book size factor) to those noted in this article. The higher end prospects of the present simply haven't separated them themselves performance-wise/pedigree-wise from the rest as some did earlier. This may, in part, be a reflection of the path of the breed-more homogeneity-, but it may also be due to the dilution of our (US) higher end female lines (to other parts of the planet). Take a closer look at the race records and pedigrees of the higher profile prospects from years past, and compare them to the higher profile retirees of the more recent few years.

20 Dec 2013 10:37 AM
Ian Tapp

Sceptre,

I like your line of thinking; there probably is some "status" disparity in the sires. But Nicole and I discussed the same thing last week: what would Bernardini stand for if he was a 3yo of 2013 and retired for 2014? I don't think he'd be $100,000... Maybe $60,000 or $75,000.

21 Dec 2013 12:40 PM
sceptre

Hi Ian,

In the past, I've nearly always found your comments to be right on mark, so when you disagree (with me) it does give me pause, and stimulation to reflect. Yes, I doubt that an incoming Bernardini would today stand for $100,000. Another interesting comparative might be the then, Hard Spun, at $50,000 vs the now, Declaration Of War, at 40,000 euros. So, what do you think; do you see the then Hard Spun any less attractive than the now Declaration Of War? I can tell you this, I've done some matings for European clients this year, and many are complaining about the high stud fees for some of their newly retired prospects. Anyway, re- the issue with first yr. US fees, I don't think the US economy factors here at all. But the breeders here may have become a bit more "sophisticated"/"educated", i.e. privy to more data, or from articles such as this one. And let's face it, these stud fees are mostly the consequence of the yearling marketplace. Here, there has been a shift, ever more apparent in recent years. Pedigree, once king, is today somewhat losing its "power" to looks/conformation and veterinary scrutiny. The result; much greater risk for those who pay high stud fees. This reality, combined with greater breed homogeneity, larger book size, and less pedigree disparity would tend to lower all high end stud fees.

21 Dec 2013 3:07 PM
Coldfacts

There is a prevailing belief throughout the world that American are crazy. Is there any merit to this belief? Well, Pet Rock s were once sold on the shores of the US.

How does this perceived American craziness relates to the thoroughbred breeding industry?

Ghostzapper's initial stud fee of $200,000 is one example. This colt is grandson of Deputy Minister. I know of no grandson of Deputy Minister that has been a superstar star at stud.

The Kentucky Derby is the most coveted leg of the Triple Crown. From a Triple Crown perspective, the Northern Dancer sire line has been beaten like a rented mule by the Mr. Prospector sire line. The record is conservative 4 to 1 over the last 20 years.

Why would anyone spend $200K to breed to grandson of Deputy Minister when the grandsons of Mr. Prospector  at significantly lower prices are the most success in TC history?

Ghostzapper had an enviable race record that was not matched by the historic category of his sire line.

Point Given from the most successful sire line in TC history entered at $125,000. Based on his achievements this fee might have been considered reasonable. However, he was built like a battle ship and was extremely straight on his front legs, suggesting that if he passed on this conformation flaw to his progenies they would not stand up to racing. Well, he has and none of them are spending a lot of time on the track.

I would not breed to him for free.

23 Dec 2013 9:01 AM
Ranagulzion

Lower fees are both realistic and smarter for the intelligent breeder.  A rising star is always a brighter prospect than a tumbling giant. Although economic factors play a major role in the lower fees, given its undoubted negative impact on the yearling market, the statistics reflect poorly on the "experts" that set stud fees as only Bernardini's performance has appeared to have held up.

23 Dec 2013 3:07 PM

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