Presentation to the Darley Flying Start Conference at Keeneland, Kentucky
July 2007

Gina Bryce vs Alex Elliott
Debate: Current stallion book sizes are too large

The argument for: Gina Bryce

Gluttony – a word that brings connotations of excess and greed. A word associated with short-term gratification and long-term damage. A word usually linked with human consumption and over-eating, but one which can just as easily be applied to the stallion market today. Ladies and Gentlemen, members of the panel, we live in an age where the economy is thriving, commodities are consumed in abundance and the thoroughbred industry is no exception. More and more foals are born each year and stallion books are bursting at the seams in response to the ever-increasing demand from a growing broodmare pool. Breeders and stallion farms gobble up the opportunity in search of that short term source of gratification with little regard for the consequences of their indulgences. The joy anticipated in that extra mouthful or those extra few dollars earned by over booking a stallion will soon be overcome by the realization that the damage we have inflicted is irreparable.

So, what is the reason for my dietary approach to the stallion market? Why should farms limit the books covered by their stallions when they are profiting so handsomely? The reason brings us back to the parallel with human gluttony; large stallion books satisfy the industry need for short-term fruition but once again the long-term implications of our actions raise graver issues. Issues that are generally only discussed by purists. Issues that industry players riding this wave of excess choose to ignore. Issues that nonetheless threaten the future of our industry. Issues pertaining to the quality of our beloved breed, the over-production of weak stock, the polluting of the gene pool and long term economic losses in a market already beginning to glimpse the fateful warning signs of decline.

Tony Morris, a fervent supporter of this motion frequently laments the fact that stallions are exploited as money-making machines, covering anything and everything, and are routinely ditched and replaced when their credibility is shot. It is no secret that stallion farms are offering more and more unlimited books in an attempt to make returns on their expensive investments and reap the rewards while their stallions are in demand. Due to the commercialism that dominates the marketplace, the stallions in demand are often those that have not yet failed, the unproven first season sires. Commercial pressure lures mare owners into supporting these unproven sires with little consideration for what suits their mare or for the outcome of the resulting progeny. Stallion farms claw and compete with glossy marketing and attractive deals such as foal shares and pay when you sell contracts in desperate attempts to fill their books and garner a market share. The result is what was once a quality-controlled business is now open to anyone in possession of a thoroughbred mare. Mares that may previously have been retired or regarded as bringing no financial value in the breeding market can now be bred to the latest first season sire in an attempt to turnover a profit.

It is well known that Bill Oppenheim has declared 6% the new 10%. Amongst the many reasons attributed to this reduction in the quality of the breed must fall the problem of book size. My opponent will likely argue that doubling the number of mares a stallion will cover gives them double the amount of runners with which to succeed. While this may be true in theory, it also dilutes the crop, as the number of mares covered increases, the overall quality of the book decreases. Stallions can rarely reach the formerly coveted 10% stakes winners to foals, as the size of the books they cover does not allow for the refinement of quality in the mares they previously enjoyed.

This sentiment is certainly one that is supported by statistics. If we look at a table of the top twenty stallions according to book size, all of which covered between 150-200 mares in 2006, only 10 of those 20 have runners. A worrying statistic in itself but perhaps more interesting is the fact that of those 10, a list which is comprised of top class sires, Maria’s Mon, Mr Greeley, Johannesburg and Stormy Atlantic, only 3 reach the coveted 6%, the rest falling well below. It is undisputable proof that large numbers do not improve statistics. If we take one example from that list in world-class sire Giant’s Causeway who covered an astonishing 191 mares in 2006, his percentage of black type winners to foals is just 6%. An average score you might say but when compared to supposedly less fashionable sire Belong to Me who consistently covers around just 60 mares, the percentages are the same. Yes Giant’s Causeway may have sired some superstars in Shamardal, Aragorn and First Samurai but the effects of a large book have diluted his success to the level of $12,500 sire, Belong to Me.

This reduction in quality is not only one that is seen on the racecourse, but is one that perhaps has an even larger impact on the sales arena. It is widely assumed that the bloodstock business is exempt from the normal rules of economics. Indeed there can hardly be an over-supply of stallion nominations as the product numbers can only be dictated by demand. However, once the product enters the sales ground two years later, the supply and demand curve can be applied once more yet this time supply often outweighs demand, leaving many small-time breeders taking expensively produced stock home or allowing them to be sold for a reduced price. Sales companies increasingly have to deal with trying to favorably place horses by the same sire, which proves virtually impossible given the fact that the majority of this over-produced stock falls into the middle bracket. We all breed to stallions such as Mineshaft and Vindication hoping to gain a favorable position in the sale but what can Keeneland do when they are faced with 50 in the same book. Somebody will have to bear the financial brunt of shifting down the scale and that somebody is the breeders.

Over exposure to any product serves only to reduce its appeal and the bloodstock product is no exception. Mr Elliott will tell you the increased numbers will improve a stallion’s chance of success, but the dilution it perpetuates only serves to denigrate the product and thus reduce their appeal. We all saw the proliferation of Chapel Royal’s and Lion Heart’s at the recent Fasig-Tipton Sale. How many of you from that single showcase of yearlings have made a premature judgment on their stock? I know I certainly have. Any sire with that number of progeny on display instantly open themselves to market judgment earlier than if there were only a few on which to base that decision. And we all know how dangerous premature judgment can be for a sire’s chance of success. Add to the fact that a large number of these big book stallions are sent to Southern Hemisphere locations to make yet more money for the stallion farms and you have the increased problem of global exposure. Buyers are tired of seeing the same stock, the result of which being that they are less willing to dig as deep into that already exhausted pocket.

And what are the long term effects of such an over-population of a handful of stallions? Apart from market resistance, the gene pool shrinks and it becomes increasingly difficult to avoid close inbreeding. It is well quoted that thoroughbreds are their own grandfathers’. Indeed we all already know the difficulties in avoiding inbreeding too closely to the many Mr Prospector and Northern Dancer line horses that saturate the U.S. market.

You may think 200 mares in one book is not a problem, but a computer generated study that Miss Pathak will allude to later in her talk on the adverse effects of artificial insemination, shows that genetic diversity is seriously affected when a stallion book reaches 200. With the number of stallions standing in the Bluegrass State decreasing from 438 in 2000 to just 360 in 2006, the choice of bloodlines is already a rapidly disappearing luxury. If the market were developing in a manner that reduced the amount of poor stallions afforded a chance, the statistics could be viewed in a favorable light. However, with mare owners consistently opting to be number 170 in a fashionable unproven sire’s book over mare number 50 in an unfashionable but perhaps better matched option, stallions will continue to fail and it may not be the right ones. In today’s market, the Danzig’s or the Mr Prospector’s of our time would surely be disregarded.

And what of those that fail? The stallions, as Tony Morris said that are routinely ditched and replaced? During the time we spend separating the milk from the cream, the well-marketed so-called fashionable horses will have covered hundreds of mares. Many people choose to forget the stallions that have lain by the wayside but what of their long-term effect on the breed? Medication and reduced soundness are weakening the breed enough. Why increase these problems by overpopulating the market with huge numbers of the progeny of potential failures.

The result of this is a degradation of our industry product that not only impacts people’s pockets but also our enjoyment of the sport, the very driving force of the industry itself. We all lament the absence of a Triple Crown horse or the poor performance of a Derby winner. But what if the Lil E Tee’s or the Giacomo’s are all we have left. No more showdowns between the Street Sense’s and the Curlin’s of our era could be a reality that is closer than we think. A continual over-production of under-qualified well-marketed horses is certainly the route to irreparable damage upon our breed and the quality of horseracing worldwide. Do we really want to see our Sport of Kings reduced to the standard of afternoon greyhound racing?

The consequences of our gluttonous stallion market are plain to see; but what are the solutions to such a quandary? An imposed limit is an unequivocal restraint of trade and therefore unenforceable and so it seems we must wait for market forces to drive the change. Alternative suggestions that have risen to the surface in this debate on over-production include a strict restriction on breeding stock much like the system employed in Germany. The huge wastage of the end product in the horseracing industry also raises issues of animal welfare, which could prompt government action and lobbying to reduce over-production. This solution would certainly allow us to bypass the notoriously indecisive racing authorities. Granted there is no easy, practical solution but the industry needs to look beyond its short-term self-interest before it is too late. We must act to protect the legacy left to us in the racing and breeding world. Breeders must cease to support exploited stallions, the market must resist their progeny and stallion farms will respond accordingly.

Ladies and Gentlemen, members of the panel, it is easy to see that there is no facile solution to the problems caused by ever-expanding stallion book sizes. Over-production is an issue that plagues our industry with little promise of reform. However what is undeniably clear is the root of these problems. As Mr Elliott will no doubt confirm, large books are fuelled by short-term financial incentives, by our gluttony with little regard for the devastating consequences; the demise of the breed, the long term financial drawbacks and the proliferation of wasted poor quality stock. What will suit my mare appears to be a question rarely considered favored by the cries of who will top this year’s freshman sire list? A question that is quickly answered by irresponsible stallion farms. Are stallion book sizes too large? If you care about the foundation of this business, you’ll undoubtedly agree that they are.

The argument against: Alex Elliott

Ladies, gentlemen, members of the panel, stallion book sizes are not too large. The thoroughbred industry is indeed just that, an industry and productivity, as in any industry, is the driving force.

Kentucky is a place where the cream of the stallion crop are based year in and year out, giving a chance to those who want to breed to each and every one of them. According to the Jockey Club website, last years average book size within Kentucky was 58.6 reported mares per stallion. Stallions within America averaged a mere 16.9 reported mares per season. So where is the concern? For the sake of this debate I defined large book sizes as being over 140 mares.
However it is not the rest of the country that disturbs those against large book sizes, it is here in Kentucky, the hub of the breeding industry, where the best are bred, raised and then hopefully returned, to pass on attributes to offspring for years to come. It is here where the elite stallions are employed to pass on their physical prowess and proven ability as racehorses. Elusive Quality, Giants Causeway, Grand Slam, Lion Heart, Johannesburg, Mr.Greeley and Stormy Atlantic are to mention a few.

I say a few, out of 58,043 mares bred last year by 3,428 stallions nationwide, 27 stallions covered books of more than 140. Of the 27 only three stand outside of this state, those being Trippi, Omega Code and Peace Rules. The other 24 stand here in Kentucky, the nerve centre of thoroughbred breeding. It is here where many people point the finger and squeal of the success that the superpowers of the thoroughbred industry enjoy and claim foul of how they have changed and ruined the breed. The fact is, like it or lump it, as with all successful business, it is survival of the fittest that wins the day. If you cannot adapt or change then you will not survive.

The theory ‘survival of the fittest’ was originally applied by Herbert Spencer in his Principles of Biology of 1864. Spencer drew parallels to his ideas of economics with Charles Darwin's theories of evolution, by what Darwin termed natural selection. Miss Bryce has spoken of how Giants Causeway is a world class sire and of his most excellent offspring. Not even I can debate such an obvious statement. To add to the outstanding horses she has mentioned I give you My Typhoon, Footstepsinthesand and Mike Fox, yet somehow Miss Bryce manages to rubbish him on statistics…….. A contradiction in terms I think. Nobody can disagree with statistics, but they are there to be played on as I did when giving you all 16.9 mares per stallion in the USA.
In fact Mark Twain wrote in his Autobiography and I quote:

“There are three kinds of lies: lies, damned lies and statistics."

Percentages, I agree, are what breeders look at, but it is the quality horse, the Street Sense’s, Curlin’s and Rag’s to Riches which make their stallions truly outstanding and what the breeders remember. We are all educated enough to spot what the spin doctors that are stallion marketing departments are trying to do and why shouldn’t they? In case some hadn’t noticed, I shall reiterate, this is business, not a convention for purists, theorists and hypocrites. Do we stop BMW giving us ‘The Ultimate Driving Experience’? Do BMW make you drive their cars? NO, we all have free choice.

Miss Bryce, along with many, believes the quality of the breed is being diluted with large book sizes. Yet my opinion is quite different. We may not give the next Danzig or Mr. Prospector a place at stud in this day and age, but something will be produced which has just as much effect on our breed if not more. Identifying animals of high genetic merit is achieved by assessing the animals themselves and their relatives, in particular their offspring. The greater the number of offspring available, the greater the accuracy of the assessment and the more likely that the breeder is successful in identifying the animals of high genetic merit, and thus the more likely is the improvement of the stock.

Judgement is made on stallions very early in their careers. This is a logical action, since breeders don't want to waste time, money and opportunities for mares by continuing to breed from unsuccessful sires. However, with such a small percentage of stallions selected, and with only a few seasons for them to reveal their genetic merit, accurate assessment of stallions early in their breeding careers is of great importance. High accuracy is achieved most rapidly by breeding each stallion with a large number of mares in their first few years at stud.

This is a method of assessment used by the commercial companies, companies that rely hugely on the successful identification of ‘what works’, and is the method of identification that would be advised by academics of animal breeding.

I do not deny that there are some serious issues with covering a large number of mares with unproven sires. However, being detrimental to the future of the breed is not one of them. On the contrary, its potential to actually improve the breed is its one saving grace.

Supply and demand.

As I have just said thoroughbreds are a business. A business is based on economics. Supply and demand is perhaps one of the most fundamental concepts of economics and it is the backbone of a market economy. Demand refers to how much (quantity) of a product or service is desired by buyers. What the superpowers within breeding are doing is supplying a service for the demand. If the demand wasn’t there then the product would have no place.

It is well known that John Magniers stallion empire has been built on the founding principle that the more foals on the ground, the better a stallions chance of success. It makes sense that the more runners a stallion has to his name, the greater his chance of success. A simple law of averages!

Coolmore have revolutionised the way in which we breed, they are setting the pace and if people don’t adapt and modify quickly then they will be forced out by better-adapting ones.
Product people are willing to buy; the relationship between price and quantity demanded is known as the demand relationship. Supply represents how much the market can offer. The quantity supplied refers to the amount of a certain good producers are willing to supply when receiving a certain price.

Accounting for nearly half the dollar volume of the auction sales market, the yearling market is generally accepted as being a true barometer of the health of the thoroughbred breeding industry. After nearly a decade of growth and expansion, the yearling market contracted in 2001 and 2002 as a result of terrorist attacks and its after effects. Since 2003, however, the market has recorded four consecutive years of gain, highlighted by records for gross sales, average price and median in both 2005 and 2006. The sales results are strong, the economy is strong. We need to keep producing horses to keep the market level buoyant.

A point to which many refer when they seek to reduce the number of mares a stallion can cover is stallion welfare. Some propose that both psychologically and physically it is detrimental to a stallion’s well being. After contacting Dr. Sue McDonnell this issue was soon ‘put to bed’. Dr. McDonnell includes all types of behaviour in her clinical case loads, with stallion behaviour as an area of particular interest and expertise. Dr. McDonnell’s research interests include several areas within equine physiology, behaviour and welfare. Her viewpoint is this:

‘Psychologically, in my opinion, the majority of stallions can handle big books, especially if well handled in the breeding situation. The same is true for fertility; I think most stallions can get the job done. Certainly some have issues but this is generally not a problem.’

Here we have expert opinion to riposte any challenges on grounds of animal wellbeing. Indeed with today’s technologies, which include scanning and short cycling, the stallions efficiency is much improved.

Many will say that the shuttling of stallions is contradicting the newfound technology in terms of actual physical coverings per stallion. Many will produce the argument that the number of shuttle stallions are down since when shuttling first became apparent in the 1980’s and say the attrition rate is due to the travelling and work load. However my concept of the situation is very different. Upon Robert Sangster’s decision to travel stallions from one hemisphere to another, John Messara (the principle of Arrowfield Stud) made it his goal to breed from these stallions. Messara made shuttling popular. His philosophy when he first brought Danehill to Australia was simple. Bring the best stallions in the world from the Northern Hemisphere. Breed to them and then stand their best sons at stud.

The fact is, we have given people the strain of the breed that they wanted; they have raced these horses in their own major races and made these horses their own. It is the familiarity which is why we see reduction in numbers. Redoute’s Choice is now (as we have heard) taking the Australian market to places even his great, late sire did not. When pressing Dr.McDonnell on shuttling she added:

‘When shuttling first started, most expected to see more challenges and failures than have been apparent. That’s because of the increased workload, plus the messed up photoperiod, changes in management, environment and handling style. The majority can shuttle year after year without major problems.’

IN CONCLUSION

People must have their own freedom of choice. You cannot stop companies making money. We live in a free market and breeders are open as to which stallion their mare visits. If individuals don’t like big books then they shouldn’t breed to the stallion. Stallions all seem full if they are good and so they should be. After all the stallion masters need to pay for all the ones who didn’t make it. The ones people didn’t support.

What I detest about this argument is the level of hypocrisy which becomes so very apparent within the research. When discussing this debate with a well known, commercial breeding operation (who did not wish to be named) they asked me how on earth I could defend large book sizes. They went on to tell me how terrible it was for the industry and how it ruins the breed. I listened and then asked which stallions they had then bred to last year. They reeled of a list which included Five Star Day and Maria’s Mon. I paused and then quietly informed them that last year Five Star Day covered 143 mares and Maria’s Mon covered 165.

The arguments against current book sizes being too large are many, yet to me, most unconvincing. Thank You.

 

Click here for a complete list of July 2007 Keeneland assignments