Britain Struggling with Declining Foal Crop
Date Posted: 2/24/2013 5:14:27 PM
Last Updated: 2/28/2013 1:40:52 PM

British runners finished 1-2 in the D'Arenberg (Fr-III) at Chantilly Sept. 12.
Photo: John Gilmore

By John Gilmore

 

Great Britain's Thoroughbred foal crop is continuing a worrisome trend, with figures released by Weatherbys showing a fourth successive year of decline in 2012 to 4,366a drop of 6% from 2011 and more than 22% in the past 5 years.

 

The decline is in part a reaction to a period of overproduction but also linked to a fall in demand by owners and the Great Recession that rocked economies worldwide beginning in 2008. Not surprisingly the number of Thoroughbred breeders domiciled in Great Britain has fallen considerably in the past four years, from 4,621 to 3,648 in 2012.

 

"The number of breeders operating in this country has been in decline over the past 10 years, but I cannot provide exact data on this to illustrate the undoubted trend," said Peter Greeves, Weatherbys' executive director and keeper of the General Stud Book. "This is because we hold records of the breeder entity of individual foals, which includes partnerships and multiple companies set up by the individual breeders for their breeding activities and other arrangements and not a file of people involved. By definition these entities will have followed the decline in the broodmare band, which has dropped by 22% over the past five years."

 

Another major factor in the decline of the foal crop has been the 8% fall in prize money since 2007, making owning a racehorse a less attractive proposition. Prize money has been affected by a decrease in racing's handle and because off-course bookmaker betting shops have diversified into other sports betting and B2 fixed-odds betting machines (electronic roulette and casino games), which now represent more than 50% of their business.

 

It also coincided, during this period, with leading British bookmakers like Hills and Ladbrokes moving their Internet and phone betting services to Gibraltar to avoid paying the levy on their racing turnover and reduce their overall taxes. The British Government is looking to tighten this situation up and make off-shore shops liable for the levy every time they take a bet from a gambler in Britain.
 
The racing industry has suffered some casualties. Two racecourses, Folkestone and Hereford, closed down at the end of 2012 with the owner Arena Leisure announcing the tracks were losing too much money to continue. Other racecourses are also struggling and more may go the same way. The current £70 million, (1.5% of turnover) or some 15% of bookmakers annual profits are likely to be lower again this year
way below the 4-5% acknowledged minimum to support a countries racing industry.

 

"The fact is that owner numbers have been increasingly in decline since 2008 as a result of the depressed economic downturn, falling prize money and as less sought-after horses have become harder to sell, inevitably, has resulted in some breeders cutting back on their foal production," said Richard Wayman, Racehorse Owners Association chief executive.
 
The drop in foal numbers, and consequently racehorses, in Britain comes at a time when the number of 2013 races for flat and National Hunt racing has increased by eight to 1,464. The objective is to try to maximize the income for racing and also meet the demands of the betting industry. This would appear to be a hard task, with racehorse numbers falling and no steps being taken to address the inadequate amount being withheld from wagering, through the levy, to fund racing's requirements. Racing for £2,000
£4,000 win prize money on a regular basis at the smaller to medium-sized tracks just doesn't add up, with annual training costs of between £15,000 to £24,000; a win would just cover a couple of month's fees. Tracks get revenue from media rights and entry fees, but it is far from enough.
 
Some attempts are being made to address the shortfall in purse money and owners. A recent British Horseracing Association deal with exchange operator Betfair to pay British Racing a minimum £8 million a year from its British racing betting for the next five years provides modest relief, amounting to just around 1% of turnover. Put in perspective, however, Betfair's U.S. operation has stated it would pay 6.66% of turnover back to racing if awarded a licence in California. The BHA has also introduced a program this year, called the British Owners and Breeders Incentive Scheme, to try and encourage new owners into racing.

 

Financed by owners and breeders fees plus a contribution from the Horserace Levy Board, the scheme offers a £6,000 prize to winning owners who participate. The program offers incentives on 450 designed 2-year-old races this year. The scheme will extend to a further 450 3-year-old races in 2014.
 
The other alternative for some enterprising British trainers has been to race in France, especially for 2-year-old races. The total prize money for maiden races at the Parisian tracks begins at €24,000 and is paid down to fifth place. For a British owner finishing fifth in a maiden race, the €1,200 prize money is more than enough to cover the travelling costs. The French, which don't have a depth of precocious early 2-year-old runners, tend to concentrate on later maturing horses, unlike in Britain, where 2-year-old races are part of the daily racing program. Last Sept. 12, for example, two British runners finished first and second in the group III Prix D'Arenberg 2-year-old race at Chantilly at over 1,100 meters. Cay Verde, trained by Mike Channon, beat Baileys Jubilee, trained by Mark Johnson. Both horses are sons of the British National Stud stallion Bahamian Bounty.

 

Undoubtedly, what has helped to nullify the problem of poor prize money in British Racing has been its long standing International reputation for selling top quality breeding and yearling stock at Tattersalls, with the likes of Galileo standing at Coolmore in Ireland and the recent edition of the retired leading racehorse Frankel now standing at stud in Newmarket. Britain on average exports between 1,500-1,750 racehorses a year, not forgetting its prestigious races like the Epsom Derby (Eng-I) or those during the Royal Ascot meeting. It remains to be seen whether this will continue, as foal numbers reach a critical level for lower level grade racing, the future appears far from rosy.



Copyright © 2014 The Blood-Horse, Inc. All Rights Reserved.

SUBSCRIBE to The Blood-Horse magazine TODAY!