To Breed or Not to Breed

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No doubt the economic crisis that hit in 2008 deeply impacted the breeding industry regardless of breed. With so many unwanted horses, isn’t that a good thing? It depends. Some of the breeder incentive programs, niche industries and breeds are (or are about to be) gone due to lack of horses. Fewer horses means a decline in revenue for veterinarians, advertising revenue, feed and supplies. Fewer horses being registered results in decreased revenue for breed associations, which has (directly or indirectly) led to layoffs or downsizing. With a new year looming, what should mare owners be aware of?

Deciding to Breed

Unfortunately, breeders have taken a hit on both ends of the spectrum with higher costs for hay, grain and bedding and fewer sales. Since it’s taking longer to sell young stock, there are new considerations for breeders who have to cover the costs of breeding and raising a foal. This scenario has weeded out many small breeders, but not all of them are out of the game. Mark Llewellyn and Wallace Battles raise primarily hunter-type Quarter Horses in Versailles, Ky. Llewellyn describes themselves as “hobbyists, hoping to breed quality horses to show ourselves.” However, they do sell some horses to show homes to help balance out expenses.

Llewellyn has five mares in foal for 2013, which is more than they have ever had. “I invest a lot of time and money in selecting broodmares, so I think it’s important that I give them a chance to prove themselves,” he says. “Unfortunately, broodmares require years to prove what they are capable of producing. I accept that commitment when I purchase or lease a broodmare, but I will cull a mare if she doesn’t produce foals that adequately represent my breeding goals, even if the foals are perfectly useful, athletic individuals. I should note that I shoulder some of the responsibility when a mare doesn’t work out in my program; after all, I am the one playing matchmaker, and I could be faltering in that regard. It’s not always the fault of the horses!”

Joanna Kelly of Fox Cradle Farm in Jarrettsville, Md., stopped breeding her Morgan sport horses in 2008 and 2009 because she did not want to “put any more horses on this planet when people were abandoning their horses because they have lost their jobs.” This year she is keeping her program small and select—she has three mares due to foal in 2013, and she is shopping for another broodmare.

Large breeders are breeding less too. Michelle Morgan, who owns Mandolynn Hill Farm with her husband Mickey in Aubrey, Texas, used to breed 15 to 20 Arabians, Arabian-crosses and thoroughbreds every year. The poor economy has caused them to cut way back. Morgan has five mares due in 2013 and plans on breeding three or four. She admits to being very selective now. “I am using the best mares I have to the top stallions in our industry,” she says.

When looking at equine registries, most are reporting fewer mares bred, fewer stallions standing at stud, fewer foals born and fewer foals registered. Surprisingly, the numbers actually started to decline before the great recession. For example, in both 2007 and 2008 there were approximately 30,000 fewer Quarter Horses registered with the American Quarter Horse Association.

In the last year, the market for riding horses has recovered somewhat, but that isn’t necessarily the case for young horses. Breeders are making adjustments in how long they will keep a horse before it is sold. However, five years from now, people will be looking for new horses and the supply will be leaner. This could bode well for those that breed now because, as Morgan sees it, “fewer horses are on the market for people that want to participate.”

Helping the Unwanted Horse

Even with fewer foals being born, there are still thousands and thousands of horses that need homes. One answer is Operation Gelding, made possible through seed money from the Unwanted Horse Coalition (UHC) and the American Association of Equine Practitioners, that was launched in August 2010 by the UHC. This program provides funds and materials to assist organizations, associations and events that sponsor clinics where horse owners can bring their stallions to be gelded.

“The impetus for these clinics is that the castration of a stallion will help prevent overbreeding and produce a gentler horse that is more rideable, more trainable and more saleable, allowing them to be used in several careers,” says Dr. Doug Corey, Chairman of the UHC.

Kelly hopes that people will breed “with the understanding that horses are like a 30-year mortgage that you are responsible for.”

Llewellyn feels that culling is extremely underutilized by breeders. However, he also feels he carries some responsibility for the mares he culls. “If a mare leaves my farm, it doesn’t mean that she isn’t useful to someone else—maybe as a riding horse or a companion animal.” He also feels that breeders should do everything possible to get young horses into the hands of competent horse people. To do that may mean lowering the asking price. “The upfront money might be less than expected,” he says, “but the long-term benefits could be immeasurable, such as a customer that returns every year or two to buy a young horse.”

Are Things Improving?

There is one sign that the breeding industry is on the rebound. The massive Keeneland September Yearling Sale for thoroughbreds, with prices ranging from over a million dollars to the $1,000 bargain horse, reported strong increases in both average and median prices.

As stated in a press release from Keeneland, “gross receipts for the 11-day sale, conducted September 10-21, 2012, totaled $219,781,500 for 2,516 horses, down just 1.66 percent from last year’s 13-day sale when 2,921 horses sold for $223,487,800. The cumulative average price of $87,354 increased 14.17 percent from $76,511 in 2011, while the median surged 50 percent from $30,000 to $45,000.”

It’s a glimmer of hope. Breeders still have to watch their expenses and be realistic with their selling prices, but the payoff will be that they can still breed high quality horses, find good buyers and sell horses for a fair price.