Bloodstock & Breeding

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03 Nov 10 16:40
Date Joined: 11 Oct 07
| Topic/replies: 471 | Blogger:'s blog
For obvious reasons, there has been much discussion about the value of yearlings at the sales, stud fees, training fees, prize money etc. I also see some comments about ongoing costs. The Racing Post quoted some figures recently.

With that in mind, I would greatly appreciate the views of those who actually own the mares, pay the stud fee and the keep costs to the following:

If you would, assume you purchased two mares this February, and had them covered in March. One mare was 12 years old and cost £36,000 the other cost £84,000 aged three. The older mare was covered at a fee of £8000 and the younger mare at £16000 both subsequent to purchase.

What would you have the stand in cost of each foal at birth as, assuming either your own keep costs or a cost per in foal mare of say £10K per annum.

Thanks for your answers.
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Report boba November 3, 2010 4:06 PM GMT
The 12 year old mare you would have to depreciate at a minimum of 25%++ a year. So that on a 30k+ purchase price would be an implicit 9k cost. The 3 year old you could depreciate at 10% per year. So a similar 8.4k++ implicit cost. Thats before you even talk about stallion fees keep etc etc. In reality people are talking about being happy when stallion fees are covered by the median. With a 12k stallion which maybe both these mares may go to you would need median returns to be double if not triple the stallion fees to be looking at making money.
Report yer ma November 4, 2010 6:07 PM GMT
I understand the point of the analysis but there are clearly imponderables.

1. Everyone thinks (mostly wrongly) that the mare with not depreciate - due to the stock on the ground / relations etc.  Age related depreciation I would concede is a factor but so is fertility which has not been mentioned.

2. Actual fee paid - I clearly need to get less if I get a cover for 1/2 the headline rate.

3. £10k keep - If you own your farm clearly there is an opportunity cost for having mares as opposed to sheep but feed + labour is less than £10k imo.  Clearly lots of variables all different each operation.

4. What are you doing buying two not in-foal mares for that sort of money in Feb?  Insane imho.

5. With Boba's example and your mares I'd be wanting my 12k cover for £9k and at the moment be happy to make £25k. But I revert to point 1 to make the foals worth considerably more.
Report boba November 4, 2010 7:02 PM GMT
Interesting article here
Report yer ma November 4, 2010 8:33 PM GMT
Very interesting and spot-on.  Shame it will never be read let alone acted upon by the numpties that instead brought us the industry-saving RP Bonus scheme.
Report November 5, 2010 2:16 PM GMT
Yer Ma and Boba,

My apologies,I guess I did not make myself clear.
The numbers are hypothetical and the dates designed to ensure only 12 month costs.

Perhaps it would be clearer if I said:

I have just bought two theoretical mares, they include a guarantee of costs for 12 months of £10K each mare.

1: Mare 1 is 12 years old and cost £36K. She has been covered by sire (a) at a cost of £8K since purchase.

2: Mare 2 is 3 years old and cost £84K. She has been covered by sire (b) at a cost of £16K since purchase.

What would be your stand in cost for the foal at birth, and do you regard the covering fee for each mare to be sensible for the mare?

I have looked briefly at the link above, I have seen a couple of similar articles. Both USA based, they; in my purely commercial opinion, are starting to get close to the real cost of a foal at birth.
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