RED DEER, Alta. – The sport of kings is a risky one at best and for those thoroughbred breeders raising lower-priced horses, it’s been a tough decade.
Walter Robertson of Lexington, Ky., president of the auction company Fasig-Tiptons and a thoroughbred owner, described the ups and downs of the industry at a recent horse breeders and owners conference here.
The thoroughbred and racing industry is a multi-million dollar a year business, yet a decline in yearling prices has been posted almost every year since 1986.
The industry has gone from boom to bust to relative stability, said Robertson.
Read Also
The Western Producer Livestock Report – August 28, 2025
Western Producer Livestock Report for August 28, 2025. See U.S. & Canadian hog prices, Canadian bison & lamb market data and sales insights.
“The top is great, but the bottom is getting tougher,” he said.
The top 20 percent of the industry sold yearlings for more than $40,000 each but the rest were below that figure. In fact, 53 percent of all yearlings sold in North America in 1995 brought less than $10,000, he said. It costs about $6,000 to raise a yearling thoroughbred.
Robertson said there are several reasons why yearling prices are struggling.
In 1986 the United States government introduced a new law which lowered the maximum income tax rate to 30 percent from 50 percent. Horse owners could no longer write off as many losses as before.
As well, many of the higher priced horses are owned by people in the oil industry or real estate business. When those businesses stumbled in the 1980s, the equine industry was hurt as well.
Another problem for horse racing is the growth of legalized gambling throughout North America. Proximity to a casino or bars with slot machines is driving some racetracks out of business. This reduces the demand for horses and it’s only recently breeders have pulled back on their breeding programs, said Robertson.
Weanlings and two year olds enjoyed better prices partly due to foreign interest with buyers from Japan, Dubai, Saudi Arabia and Europe. Foreign interest sustains that market, said Robertson.
Weanling sales in the last 12 years have grown from $16 million annually to $60 million last year.
The two-year-old market was strong as well and 1996 was a record year in almost every category for this age group, thanks mainly to Japanese interest, said Robertson.
The American thoroughbred industry has been a direct beneficiary of the U.S. government’s bid to open up trade with Japan.
More foreign horses are allowed into Japan and rules governing the tracks are slowly relaxing.
In 1997, 55 percent of the stakes races in Japan will be open to foreign-born horses, but they must be owned and trained by Japanese. Only Japanese are allowed to hold racing licenses in Japan.
It is the realm of the very rich, however.
“The purse money is beyond the wildest dreams of anyone in the U.S. or Canada,” said Robertson. A $200,000 yearling can pay for itself in three or four races without ever winning the stake, he said.
Japanese buyers keep returning to North America because in their crowded country there isn’t enough room to raise horses.
