Lawsuit challenges limiting stallion books

[LaurieB]

@Texarkana

Hypothetical question: if state incentives were used to subsidize the cost of getting a foal to its first race, do you think more breeders would be inclined to try?

It’s hard for me to imagine how that would work. Can you elaborate on what kind of plan you’re thinking of?

Interestingly, Kentucky where 70% of foals are born, has a breeders’ incentive program that is paltry compared to what is offered by other states. KY also charges a 6% tax on just about everything equine related from feed to stud fees. (Cattle, sheep, llama and chicken owners pay no sales tax on the same items.) So I cannot imagine my state wanting to have anything to do with a subsidy program. The KY breeders incentive program has only been in existence for about 15 years. Before that, the thinking was that it was a priviledge to be able to breed TBs here, so the state didn’t need to give you a chance to earn back some of the money you’d invested in the industry.

[LaurieB]

One interesting component of the stallion cap that isn’t discussed much is that the JC will only register offspring from the first 140 mares a stallion is bred to each year. The average live foal rate in the TB industry is 65%. So if 140 mares are bred, each popular stallion will produce (on average) 90 foals a year.

If a mare is bred but doesn’t get in foal, she still counts in the 140. If she dies after being bred, she still counts. Stallions don’t get “extras” to make up for mares with problems. So I would expect that when the cap goes into effect, stallion managers will be likely to start excluding older mares, barren mares, and those with spotty produce records. The Haves and the Have Nots are going to be separated into two camps very quickly and it won’t be pretty.

Fwiw, 85% of the foals in the KY TB foal crop are produced by breeders who own fewer than 15 mares. Those “small” breeders are the ones most likely to be impacted by the stallion cap, and also the ones most likely to go out of business because of it.

[Where_sMyWhite]

@LaurieB

Thanks for the reply. You bring up some good points that I know I hadn’t thought of and why I was hoping those closer, shall we say, to the action and more likely to be impacted would respond.

Yet another example (I’ve seen them throughout the course of my life in many different areas) where a ‘limitation’ is imposed on something with an intent to ‘control’ or ‘limit’ the “big guys” where, in fact, it is probably less of an impact to the big guys and more of an impact to the “little guys”.

[halo]

As usually, @LaurieB is spot on. This is one issue that just hasnt been brought up, and its a serious issue. It may not rear its ugly head for a few years, since we still have a couple dozen commercial stallions who wont fall under the new rule and will be at stud another 5 years. But if you look at it if it were happening now, it could be nearly impossible getting into a stallion of your choice. If a horse now breeding 200 mares is breeding 140, then those 60 mares he would have bred have to trickle down to the next level stallion. Those next level stallions stallions are still breeding large books, so theres more mares that are being cut out and have to drop down. I can breed to a top level young stallion right now for $5000 or so, but that horse is breeding 175 mares a year. So who will I end up having to breed to when all those mares who would book to more expensive stallions trickle down to that level of stallion. It doesnt take long before the stallions left are non commercial, or non productive, and I can promise you, people wont breed to them then anymore than they arent breeding to them now. LaurieB makes a good point on that, as I know she is very particular who she breeds her mares to, and Im sure she hasnt got a list of 4 or 5 stallions for each mare. Even I, who breeds mares on a lower level than she does, decides who best suits my mare, and this year I had it narrowed down to 2. Had I not been able to get to either one, Im not sure if I would have bred her or not.

Another issue not being addressed. What do these stallion managers do with the top 10 most popular stallions which would normally get a book of over 200? Now they have to stop at 140, and theres no room for that late retiring grade 1 mare who needs to go to a top horse. How will mare owners play poker with these new rules? They will have to get into these stallions really early, because if they wait even a little bit, they can be left out. The little guy will be done, there will be no breeding to the commercial sires. If it were all about who you knew before, it will be twice as bad with such limited seasons available.

[halo]

Another thought. Spendthrift became very popular with breeders also because of their Share The Upside program. They would allow a breeder to breed to a stallion 2 years in a row, pay 2 full stud fees, and that would give you a breeding right to the stallion for the rest of his life. It was a gamble, as most stallions arent successful, but it gave smaller breeders a chance to get in on the groundfloor on a successful stallion, and yes, there were a lot sold to Into Mischief. With the limits on mare numbers, they now cant offer these great programs to breeders. As LaurieB mentioned earlier, with only 140 mares…not 140 foals…the stud fee revenue will be much reduced…unless the stud fees are raised, and Im afraid that will have to happen to make up for lost revenue.

[skydy]

@LaurieB

One interesting component of the stallion cap that isn’t discussed much is that the JC will only register offspring from the first 140 mares a stallion is bred to each year. The average live foal rate in the TB industry is 65%. So if 140 mares are bred, each popular stallion will produce (on average) 90 foals a year.

If a mare is bred but doesn’t get in foal, she still counts in the 140. If she dies after being bred, she still counts. Stallions don’t get “extras” to make up for mares with problems. So I would expect that when the cap goes into effect, stallion managers will be likely to start excluding older mares, barren mares, and those with spotty produce records. The Haves and the Have Nots are going to be separated into two camps very quickly and it won’t be pretty.

Fwiw, 85% of the foals in the KY TB foal crop are produced by breeders who own fewer than 15 mares. Those “small” breeders are the ones most likely to be impacted by the stallion cap, and also the ones most likely to go out of business because of it.

Do you think there is any chance that once these issues come to light (I mean once the limitation is actually in force and if it has some very negative consequences ) that the Jockey Club might tweak the rule?

If small breeders decide against breeding at all, instead of going to less appealing stallions, it will be noticed. Do they really not care about such an important part of TB breeding?

Is the rule being discussed amongst the non-commercial breeders? What is the opinion of the TOBA? Are your concerns being voiced to TPTB or the TB trade mags? Are the big stallion breeders aware of how the rule will affect the small breeding operations?

[LaurieB]

@skydy

Not unless they’re forced to.
No.
Yes.
The JC’s opinion is TOBA’s opinion.
Yes.
Yes.

[skydy]

All but one of your yes/no answers make things seem rather hopeless.

[LaurieB]

@skydy

All but one of your yes/no answers make things seem rather hopeless.

Not necessarily. I wouldn’t be entirely surprised if the current lawsuit ends up being settled with a compromise.

[skydy]

I didn’t see the “not unless they’re forced to” answer the first time I looked at your response. Did you edit?
Hopefully they will be forced to. I’ve seen the lawsuit by the commercial stallion breeders. Is there a suit by mare owners as well?

[LaurieB]

Yes, I edited the first answer for clarity.

[skydy]

Do you know if any mare owners have filed suit? I hope the stallion interests aren’t alone in objecting.

[LaurieB]

@skydy

Do you know if any mare owners have filed suit? I hope the stallion interests aren’t alone in objecting.

The only mare owners who have the money needed for a lawsuit like this one, are big enough not to be impacted by the cap.

[Ponycatraz]

STB’s have limits, but they put them in place when they allowed AI and ET. It was a good compromise to prevent genetic bottlenecks and give owners access to global stallions.

[Pronzini]

@Ponycatraz

STB’s have limits, but they put them in place when they allowed AI and ET. It was a good compromise to prevent genetic bottlenecks and give owners access to global stallions.

That’s interesting. How do the caps work in standardbreds?

[Ponycatraz]

Let me see if I can find the USTA doc. Mares are one registrable foal a year and I want to say stallion limits are similar to the JC suggestion.

[Pronzini]

The chips are stacked so high against breeders its a wonder that anyone does it.

You need to start with a whole bunch of luck–that the mare gets in foal, that the pregnancy is uneventful and the foaling routine, that there are no paddock accidents, sickness or other calamities that strike down either the baby or the mare or both.

Then the baby needs to have some quality–not too small or crooked or plain.

Then the stallion you perhaps took a flyer on needs to still have some commercial presence.

Then your luck needs to hold as the baby matures and again no paddock accident, sickness or other issues. (I suspect the uninitiated might be amazed at the X Rays of babies just coming out of a field where they were allowed to roughhouse and just be horses. A friend of mine getting bad news about his yearlings after routine pre sales prep X Rays exclaimed “Did they drop them from a helicopter?”)

Occasionally routine pre sales scans give you the worst of all news “unraceable”. These could include OCDs, cracks where you didn’t realize they existed and/or breathing issues. Sometimes this does not doom the horse–every one has a story of a horse pronounced by vets to be unraceable who turned into quite the racehorse. Chances are good they existed before the widespread use of X Rays when people just took it on faith they could buy, break and race the yearling in front of them.

The point is that stallion selection is one of the few things breeders can control. If you get a baby, the baby will be by X because you signed a contract for X. That’s why, I think, breeders flock to the same handful of stallions particularly if they are trying to be commercial. It’s a way to deal with rest of risk which can be overwhelming if you start to think about it.

[LaurieB]

Very well said @Pronzini.

[Where_sMyWhite]

FWIW, Paulick Reports current (and fairly recent since I don’t recall this poll yesterday) is asking is the person responding is in favor or opposed to the JC cap.

https://www.paulickreport.com

[halo]

From another site, an interesting post that the JC just basically destroyed its own arguments against not allowing AI with implementing a 140 mare cap on stallion books. Would it not make more sense now to allow AI, and let these 3rd tier stallions get more mares? I would have to think that people in other states would love the opportunity to breed to better stallions than they have in their states, but the costs of shipping and board are too prohibitive, especially in breeding to a $5000 stallion. I have little hope that this will even be brought up, but if the JC were serious about keeping more stallions in business, it should be considered.