A horse of a different colour

IRELAND: Hey, want to buy a racehorse? If you happen to have a lot of spare cash, Irish horse breeders would like to hear from you. The current financial crisis has hit the racing and breeding industry hard.

Take, for example, the racehorse auctioneer Goffs. The firm held its third annual “Million” sale two weeks after the Lehman Brothers bank crashed in September 2008. Goffs chief executive Henry Beeby told Bloomberg News: “It wasn’t a great day to be trying to sell something like a racehorse. Racehorses are a luxury item paid for with disposable income.”

Sales at the Goff auction fell by 40 per cent, Beeby said, with the average price for a horse falling to €72,652. While that might sound like a lot of money, the figure was one third lower than the average price for 2007. The company no longer holds the "Million" auction.

"Racehorses are a luxury item," says Henry Beeby, chief executive of Goffs auction house.

According to the Irish Thoroughbred Breeders’ Association, 65 per cent fewer Irish horses have been sold in the past two years. Stud fees for breeding horses have also fallen “dramatically”, the association says. Ireland produces 42 per cent of the thoroughbred horses sold in Europe, according to figures provided by the breeders’ organization. The industry pumps about €1.1 billion into the Irish economy every year — or at least it did before the recession.

Julie Lynch, a manager at the Irish National Stud, one of the country’s largest breeding farms, says it could take up to three years for the thoroughbred horse industry to rebound from the recession. “A huge amount of our clients would have been people who got in on the Celtic Tiger boom,” Lynch explains. The farm has cut some of its stud fees by 50 per cent in response to the crisis.

Still, it’s not all bad news. Stud fees for top racehorses remain high. “It’s the middle to the lower end that’s most affected in a recession,” says John Oxx, trainer of Sea the Stars, the Horse of the Year at the 2009 Cartier Racing Awards . “There’s always a market for the crème de la crème.”