Studmasters back their stallions as historic highs persist

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The cooling of the Australian bloodstock market has not led to a corresponding reduction in stallion fees ahead of the 2023 breeding season.  

Two months ago, this column undertook the foolhardy task of trying to predict what Australian stallion service fees might look like in 2023. Framed in the context of a yearling market on the wane and broader economic uncertainty, it was suggested that fees would come off the boil.

Well, the numbers are in, and they tell us that when it comes to setting service fees, studmasters remain confident in the value of their biggest assets, their stallions.

The average service fee of a Top 20 priced stallion in Australia has more than doubled since 2014, reflecting a similar surge in the market for yearlings, broodmares and foals in that time.

In 2023, it will be $124,300 (all fees including GST), slightly short of the high-water mark of $125,675 set last year, but significantly higher than what it was in 2021 ($99,825) and 2020 ($86,350).

The commercial juggernaut that is Yarraman Park’s I Am Invincible (Invincible Spirit), whose progeny at the 2023 Australian yearling sales grossed more than any other Australian stallion in a single season in history, has no doubt played a part in retaining this top end strength. His fee went up from $247,500 to $302,500 for 2023 and was one of seven stallions in that Top 20 segment who had a fee rise.

However, if we filter down to the Top 50 and Top 100 stallions on service fee in Australia, we can also see that service fees have remained largely unchanged from 2022. The average fee of a Top 50 stallion is $74,030, down slightly on what it was last year ($74,745). In 2021 that average was $61,710, while in 2020 it was $51,975.

In terms of the average fee of a Top 100 stallion on price, this year that mark stands at $46,882, slightly less than last year when it was $47,152, but much higher than it was in 2021 ($39,474) and 2020 ($37,322).

Average stallion service fee in various fee categories per year

Year	Top 20	Top 50	Top 100
2023	$124,300	$74,030	$46,822
2022	$125,675	$74,745	$47,152
2021	$99,825	$61,710	$39,474
2020	$86,350	$51,975	$37,322

 

The addition of new stallions is one of the most significant influences in fluctuating averages and the past two years have featured two very high-profile and high-priced stallions added to rosters. In 2022, Home Affairs (I Am Invincible) debuted at Coolmore Australia at $110,000, while this year will see Anamoe (Street Boss) kick off his career at Darley’s Kelvinside base at $121,000.

While there may be other new additions announced in the coming months, as it stands the average service fee of a new sire on an Australian roster for 2023 sits at $27,382. Again, that is slightly less than last year, when that figure was $28,614, but much higher than it was previously at $22,614 in 2021 and $23,400 in 2020.

On the flip side are those ‘established sires’, the ones who are not in their first season, whose fee fluctuations can also be a good indication of market confidence. Charting these ups and downs is often where we see the true sentiment of the market. What a look at the 2023 service fees schedule does is show how divided the top and bottom end are.

Of the service fees announced for those established stallions we have seen that while the proportion of those that have risen on last year, 16.9 per cent – is largely consistent with the past two seasons, there has been an increase in the percentage that have dropped, 35.2 per cent.

In the past two seasons, we have seen 29.9 and 29.2 per cent of Australian stallions have their fee reduced from the previous year, but that has grown this season. It is still well short of what happened during the chaos of the early pandemic months in 2020, when studmasters cut the service fee of 61.7 per cent of listed stallions.

Percentage of Australian stallions whose service fee has changed

Year	Fee up	Same	Fee down
2023	16.9%	47.9%	35.2%
2022	15.2%	54.9%	29.9%
2021	17.0%	53.8%	29.2%
2020	5.4%	32.9%	61.7%

 

Splitting into those different price categories mentioned earlier, we see only 20 per cent of stallions in the Top 50 had a fee reduction, but for those outside the Top 50, the proportion more than doubles to 43.5 per cent.

Last year, the corresponding figures were 24 per cent for the Top 50 and 32.5 per cent for those outside of the Top 50, while in 2021 21 per cent of stallions inside the Top 50 had their fee reduced, compared with 32.2 per cent of those outside of it.

That data backs up what statistical analysis has told us about the yearling, weanling and broodmare market in Australia this season. They have become more polarised, with continued strength at the top end, while the remainder of the market has taken a step back.

What about New Zealand? What do stallion service fees tell us about trends across the Tasman?

There are a few key differences with the New Zealand market. Firstly, we are dealing with a much smaller dataset, between 40-50 stallions, whose fees are advertised excluding GST.

The second factor is that the 2023 yearling season has seen boosted investment in New Zealand bloodstock after spending in the previous two years was suppressed by lockdowns and border closures. The third factor is the amazing run that New Zealand-based stallions have been on, having sired 19 of the 71 Group 1 winners in Australia this season, which has necessitated upward adjustment.

The average service fee of those stallions already announced in 2023 will be NZ$17,943, a huge jump from 2022 when it was NZ$12,810. Rich Hill Stud’s Proisir (Choisir) has played a major role with this, with his fee jumping to NZ$70,000 from NZ$17,500 in 2021. Barnmate Satono Aladdin (Deep Impact) has also jumped from NZ$12,500 to NZ$45,000.

That duo and Westbury Stud’s Tarzino (Tavistock) were the three sires inside the Top 10 to see their fee rise, while the remaining seven stayed at their 2022 fee.

Overall, 27.9 per cent of New Zealand-based stallions will have a fee rise in 2023, while only 23.3 per cent had a service fee reduction. That means 48.8 per cent stayed at the same level. That follows a 2022 season where 30.8 per cent of stallions had a fee rise, and just 10.3 had their fee reduced.

While obviously coming off a much lower base, those figures are more positive in terms of trend than the Australian figures over the same period.

Average stallion fee and annual stallion fee trend for New Zealand-based stallions

Year	Average	Fee up	Same	Fee down
2023	$17,943	27.90%	48.80%	23.30%
2022	$12,810	30.80%	58.90%	10.30%
2021	$13,271	23.80%	64.30%	11.90%
2020	$11,805	5.10%	41.10%	53.80%