In Wake of Uncertainty in Ontario: ‘We’re Still Here Fighting’

by | 09.04.2013 | 8:56am
Standardbred trainer Ben Wallace, a new buyer at the CTHS yearling sale, called government decision "a bad deal for the province in job losses."

If people thought that the worst was behind them at last year's Canadian select yearling sale, six months after the Ontario government suddenly terminated the slots-at-racetrack program, well, they were wrong.

Never mind that Ontario Premier Kathleen Wynne has repeatedly told the province's racetracks that the government is intent on working with the industry to make it viable in the future. When the sun set on the select sale at the Woodbine Sales Pavilion on Tuesday night, disaster reached another level. While about one-third of the yearlings failed to sell at last year's unhappy event, this year 54% of the yearlings catalogued were withdrawn or failed to exceed their reserve price.

That's an increase of 45% in the clearance rate over last year, in an arena where buyers are still restive about the future of the industry in Ontario. A three-member transitional panel (meant to bring the industry out of the dark ages of slots into self-sufficiency in three easy lessons) will not table its final plan until October.

“We have no long-term plan,” said breeder/agent/consignor Gail Wood. “We have no idea what the government is going to do. They destroyed what we had, which made sense to nobody, and now they've chosen to leave it for a year and a half. And it's a death by a thousand cuts.”

The gross sales of 137 yearlings this year of $3,003,000 was down 23.8% from last year's total of $3,942,000, albeit with 155 yearlings. The average price dropped by 13.8% to $21,920 from $25,432 last year, while the median shifted downward to $16,000 from $18,000 from 2012.

Top price for the sale was the $170,000 that Robert Cudney and partners paid for a bay colt by Perfect Soul (sire of Breeders' Cup winner Perfect Shirl, and Golden Soul, second in this year's Kentucky Derby) out of Tapatina, dam of Internallyflawless, winner of the Del Mark Oaks and from the family of Bosra Sham, champion 3-year-old filly in Europe.

Marchfield's first crop also sold strongly at the sale, although he stood at stud only briefly in Canada, before being sold to South Africa after the Ontario government announcement. Canadian Hall of Fame trainer Bob Tiller paid the second highest price of the sale for a son of Marchfield out of a Giant Causeway mare, Good Religion. Tiller worked as agent for owner Rolph Davis.

Tiller, annually one of the leading trainers at Woodbine, was the most active buyer at the sale. He and his clients spent $420,000. One of his long-time partners, Frank De Guilio Jr., said he spent more than he did last year, because the quality of the yearlings was so high, perhaps the best he had seen. “It shows the breeding industry was going in the right direction,” he said. Many of the yearlings sold on Tuesday were probably already bred as the political sands were shifting in Ontario.

Conspicuous by his absence at the sale was Canada's leading trainer, Mark Casse, who bought one yearling remotely as agent. Not surprisingly, Casse's purchase was a colt by Marchfield, a two-time champion in Canada that he trained for Eugene Melnyk, out of Miss Crissy, a stakes winner in Canada, who has produced restricted stakes winners.

Danny Dion, always active at the Canadian yearling sales, didn't slacken his interest, buying six yearlings for a total of $272,000, the most expensive being an $80,000 Marchfield colt.

But for the breeders, it was a tough night. “It was certainly a difficult sale for myself and some of my clients,” said Glenn Sikura, president of the Canadian Thoroughbred Horse Society, which owns and operates the sale. “We can't blame the government for everything, but we're still waiting to get some details, rather than hearing all kinds of generalizations. We don't know exactly what our industry is going to look like.

“We've done a great job to maintain what we've got, and we're still here fighting. But to expect people to step up and spend money on yearlings, you're going to have to provide some certainties.”

Sikura's agency sold 11 of its 19 yearlings, buying back the rest. A colt by Eskendereya was purchased by Zayat Stables for $39,000 (Ahmed Zayat owned Eskendereya, a one-time favorite for the Kentucky Derby). Sikura has one yearling selling at the Keeneland sales next week; he thinks it may sell for more than all of the 19 yearlings combined that he was able to sell in the Woodbine consignment. A couple of them sold for $3,000 – and this was the select part of the sale. The open session is on Saturday.

Sikura will be back to the barns Wednesday where he expects people will make private deals. He may have to race a couple that he hadn't intended to, he says.

He added that there were fewer yearlings in the sale this year because people may have already unloaded horses they could not afford to keep, or they have sent them to the Kentucky sale, hoping for better luck there.

Breeder Michael Byrne sold 13 at the Toronto sale, but says he plans to sell 10 in Kentucky, as he does every year. He found himself in a tough situation 18 months ago: Wayne Hughes' Spendthrift Farm arranged a deal to stand Breeders' Cup winner Court Vision at Byrne's Park Stud in Mono Mills, Ont., but only weeks after the breeding season started, the government announced the end of the slots program.

Court Vision bred more than 80 mares last year, nevertheless, and this year, the numbers have climbed to 120, with the support of Spendthrift. The first year “people ran for cover, because of the rug being pulled,” Byrne said. “I think people have sort of settled into it now and they know there is some light at the end of the tunnel. I believe there is. I said all along that common sense would prevail, because so many jobs are at stake.”

Byrne said he has culled his broodmare band from almost 30 mares to less than 20 and he plans to cut back more. “It's expensive because it costs as much to keep a cheaper mare as an expensive one,” he said. “You've got $20,000-plus into a yearling before it gets to the sales.

“It hasn't been easy staying the course,” he said. “Know what my bankers have said to me the last few years? They read the papers. Fortunately they've been good with me, but I've been with them since I went into business in 1982. They were nervous. But fortunately the value of our property has got to the point that we have the necessary collateral.”

Gus Schickedanz, a Toronto developer, bought back the first of three yearlings he entered in the sale Tuesday, because the filly by his stakes winner Mobil didn't bring her reserve of $34,500, reaching only $27,000. “I'm a survivor,” said the 84-year-old who bred the likes of Langfuhr and Wando. “I'm going to hang in until the cows come home. We'll hope for the best. Last year we did very well in Kentucky. We ship nine or 10 to Kentucky.”

Farm manager Lauri Kenny said Schickedanz has had 18 to 20 foals every year, but this year, only 11 (10 of them fillies). However, the cutbacks have nothing to do with government changes and more to do with Schickedanz's age. Only nine mares are in foal for next year. If Schickedanz does not sell his yearlings, they will join his racing stable at Woodbine.

Bill Graham, breeder of Canada's 2012 Horse of the Year, Uncaptured, and also top mare Joyful Victory, is more abrupt. The government actions have “killed the breeding game,” he said.  He currently has 15 to 16 mares, but he plans to sell some, which means he'll also have to lay off some people at his Windhaven Farm. He currently employs 10 to 12 people. He sold five yearlings at the sale Tuesday and will sell 10 at Keeneland.

“It's terrible. There are no people here,” he said with a wave of his hand. “I don't think (the transitional panel) is going to solve this problem.”

Trainer Reade Baker, who bought only for Danny Dion's Bear Stables, said he believes Premier Wynne will help the business, but “people would like to see that in black and white.”

The slots issue has not slackened the pace of Dion's buying. “We're trying to take an opportunity here because I think there are some very nice horses being overlooked,” Baker said. He thinks it would be a better idea to stage this sale in October, so the yearlings have more time to grow, and so that the sale won't be held so close to the “biggest sale in the world,” namely the Keeneland September Yearling Sale.

However, until Wynne does make a concrete decision about the future of the sport, the breeding business will collapse, Baker said.

“Any yearling that sells below $25,000, those guys are losing money,” Baker sake. “They just can't exist for a long period of time.”

As bad as things seem at the Thoroughbred yearling sale, the Standardbred sales – yet to come in Ontario – will probably be worse.

For the first time, Standardbred trainer, Ben Wallace, bought a thoroughbred yearling at the sale, hoping to “reinvent” himself, he said. Wallace, based near Mohawk Raceway in Ontario, was Standardbred trainer of the year in Canada in 1999, when he guided Blissful Hall to win the U.S. Pacing Triple Crown.

Wallace spent $22,000 for a filly by Milwaukee Brew, consigned by Gail Wood. “She's a nice, clean filly and I want an Ontario-sired horse,” Wallace said. “A lot of Standardbreds won't get sold in this province. A lot of them have pedigrees for tracks that don't exist any more, and they aren't pedigrees that we'll ever see at Woodbine. This filly might not win me an O'Brien Award (Canadian Standardbred award), or a Breeders' Cup, but it will be a good challenge.” He sees more hope in the Thoroughbred side.

Wallace said he's had to lay off several employees because of the drop in his business, but he's loath to let people go who have been with him 10 to 15 years. At one time Wallace raced a stable of 50 horses. That's now down to 30.  He's reduced his staff from about a dozen to nine or 10.

By the end of the day, Wallace and Wood got into a lively discussion about the damage left by the government decision. “Forget about Standardbreds and Thoroughbreds,” Wallace said. “It's a bad deal for the province in job losses.”

Wood lives in a rural area, and every day jobs are being lost, she says. “We had a huge amount of people looking at horses, every bit as much as any other year,” she said. “But the sale shows the true realization of people's fears in investing. And breeders take the worst of it. The trickle- down effect in rural Ontario is going to be felt with a backlash and a great deal of anger for a long time. “

“Not to blame everything on the government,” Sikura said. “But a lot of it does fall right on their lap.”

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