One of the rallying cries of the PSAs is that horse prices have plummeted since the last slaughter-house was closed in 2007. While both the GOA report and the AVMA both state that there has been no decrease in the amount of horses slaughtered since 2007, the PSAs still whine that it has wiped out the market. Guess what? On some levels I actually agree. The market for low-end horses has definitely tanked. I don’t even think this is in question no matter what side of the slaughter issue you stand on. What our PSA friends refuse to acknowledge is why the market has dropped out for the bottom end horses.
I feel like I’m stating the obvious, but right around the time the last slaughter plants for horses closed in the US, we went into a global economic crisis. Many people lost their investments, their homes and their jobs. Economists say this is the worst recession since the dirty 30’s. According to the AHP Industy Survey, nearly 60% of the horse industry’ is made up of pleasure riders. (http://www.americanhorsepubs.org/resources/AHP-Equine-Survey-Final.pdf) These are largely recreational riders and horse owners who were the very same people who shopped the low-end of the horse market. Their lives are not dependent on having horses, so it stands to reason as their disposable income went down, so did the demand for low-end horses. I am NOT saying they all rode low-end horses, but their investment in the horse industry was and is directly relational to their income. It isn’t a huge leap to guess that the people who had less money to spend and were buying lower end horses may be out of horses all together now. As a result the kill buyers have far less competition for the young, healthy horses they prefer and prices are way down for these kinds of horses.
Now, we should look at the higher end of the market. Because I’m lazy, I’m just going to use the `Big Two’ for examples. That would be the AQHA and the Thoroughbred sales stats. They have the biggest registries and are also far easier to pull up, so we’ll go with the stats from the AQHA World Sale and the Keeneland September Yearling Sale. They are the premier sales for their respective breeds. In 2006 the average for all sessions of the AQHA World Sale was $6698 with 379 horses sold. That same year, the Keeneland September Yearling sale saw 3556 horses sold for an average of $112,427. Skipping ahead to last year the AQHA World Sale’s numbers were 183 sold for an average of $4690. Last year Keeneland had 2921 sold for an average of $76,511. I know as far as these sorts of sales, the median is the most important number as one or two extremely high selling horses can throw the average out . The high selling horse for the AQHA sale in 2006 was $200, 000 while the high seller in 2011 was $65,000. At Keeneland, the 2007 sale topper went for 3.7 million, while in 2011 it was 1.4 million dollars. It should be noted that last year saw the highest median at Keeneland September Yearlings in the last few years and marked increase in sales averages over the previous year. Unfortunately, the sources I used for the AQHA World Sale did not list the medians although a comparative analysis drawn between 2010 and 2009 sales results also indicated things very much on the road to recovery for QHs.
Since my point of reference is TBs, I can say that the low-end dropped out of our horses too. Many smaller breeders got out of the business. They weren’t all bad breeders either. The rule of thumb for selling a yearling is that you need to get at least double your stud fee back in order to start seeing any sort of profit. Of course that only works if you invested more than $5000 in your stud fees and that is still pretty cheap for a TB. The Jockey Club does not support slaughter and the market for TB sales is not driven by meat prices. The drop in prices was blamed solely on the economic crisis and many leaders in the industry said it would bring about a market correction. While nobody wants to see their bottom lines drop, it has corrected to a degree. Stud fees reduced to reasonable rates allowing breeders to have more choices and value for their dollars. With the middle to low-end drastically affected, people became much more selective in what they were breeding and as a result, have begun to revalue their `product’. An example is KY Derby and Preakness winner I’ll Have Another. Because he is not considered to be well-bred or conformationally correct, there was basically no interest in the US market for him to stand at stud here. As a result he is on his way to Japan in the next week or two. Maybe prior to 2007 he would have had a chance to earn his stripes in KY, but there wasn’t much surprise among the industry insiders when this deal was announced. In general, TB prices are considered to be on an upswing again and the industry is recovering from the crash. People are optimistic it will be stronger than ever.
The biggest complaint I see from PSAs is there are no good cheap horses to buy anymore and poor selection of the ones left out there. . See https://shedrowconfessions.wordpress.com/2012/06/26/where-have-all-the-unwanted-horses-gone/ for some PSA quotes on the issue. It seems they want to have a bunch of cheap horses to choose from, yet they all want top dollar for whatever broken down nag they are breeding in their back yards. The concept of a market correction is well beyond their grasp. Unless the PSAs want to go into the breeding for slaughter business, there is still going to be a poor selection if kill plants open back up. Why? Because those cheap,young, healthy horses that people want to get their hands on are going to be headed for the dinner plate. The PSAs think that the anti-slaughter people want no horses bred ever. They have a hard time understanding that nobody was said that. We just want this backyard and indiscriminate breeding of poor quality horses to stop. I may be a snob, but I’m perfectly fine if not everybody can afford to buy a horse. I don’t think that is a God-given right. Maybe people will take better care of their horses if they can’t just go replace them for a couple hundred dollars after they wreck them. Maybe it will make it harder to hoard them. Maybe the ones left standing in the horse industry will appreciate and do right by the horses. We can always hope anyhow…..