The future psychological benefits of fighting back strongly at the end of a losing game are recognised in most team sports. And there are obvious parallels with this year’s yearling market in Britain and Ireland. Had not Tattersalls’ Books 2 and 3 fared as well as they did under the current climate, the mood going into the next round of reinvestment – both for 2021 nominations and foals to resell next year – would be a great deal gloomier. Always save the good news until last. Or, should I say, the least bad news if not the wholly good news.

In the difficult circumstances that prevailed throughout the year, it’s a huge compliment to all involved that yearling trade not only took place at all, but did so with the sober realisation that horses needed to be sold. Cash flow needed to be maintained. Money needed to be freed up, if not to look to future investments then at least to cover existing costs.

The first bit of good news for Tattersalls’ clients was that a higher proportion of yearlings sold in 2020 (83%) than did a year ago (81%) across all four sections of their yearling sales. Tattersalls can thank their Book 3 offerings for that strange turn of events, with an 85% clearance rate compared to 80% last year, while Book 2 maintained its 85% score from last year. Its flagship Book 1 fell by three points to 79% this time around.

If you were presented with the Book 3 results in isolation, you could be forgiven for thinking it was a normal year of trading. Yes, the top two decile averages were down – by 4.4% and 2% respectively – but virtually every other decile showed growth from last year’s sale. And Book 2 posted an increased average price for its top two deciles (+3.7% and +0.9%) of its market, while holding setbacks to under 10% for the next 50% of its yearlings. It was only the bottom 30% that inched above a decline of 10% in average price.

The lifting gloom wasn’t altogether apparent during the first week at Tattersalls. True, the bigger battalions were in town to shore up the elite end of Book 1, but trade was more difficult for those with a yearling that could have been in Book 2. Overall, the sale’s average sagged by 13% but that figure perhaps masked the difficult time most vendors were enduring. Outside of the top decile, which was down just 3%, all other segments were collectively about 18% shy of where they were a year ago, with decile three hardest hit with a 26% reversal. Those yearlings just off the radar of the big buyers really did suffer most.

That was the not-so-bad news. Further afield at Doncaster, which hosted Goffs’ two Irish sales and the Goffs UK Premier Sale, the returns were a good deal starker, particularly for Ireland’s transferred boutique sale.

In the Covid mayhem, some key buyers were either not present or couldn’t find horses they liked. The upshot was that Goffs’ better yearlings sold cheaply compared to last year’s counterparts. All told the average slipped by 35%, with the top three deciles bearing the brunt of the falls, contracting by 49%, 26% and 25%. Goffs Sportsman’s Sale didn’t escape the melee either. Hosted at Doncaster ahead of its select counterpart, it suffered the double whammy of a very low clearance rate (68%) and average and median prices that were down by over 20%.

The 2,700,000gns Kingman colt was a highlight of a memorable Book 1 – Photo: Laura Green/Tattersalls

It was a similar story for the Goffs UK Premier Sale, which saw a drop in clearance rate of five points to 85% – still excellent in the circumstances – but the drop of 35% for its top 35 yearlings set the tone. The next 60% of prices were short of the 2019 average by 23%. All of these numbers might paint a frightening picture, but there is one metric that offers plenty of hope. The elite market, consisting of Tattersalls Book 1 and 2, Goffs Orby, Arqana and the Goffs UK Premier Sale at Doncaster, collectively has seen a fall in average of just 14%. Back in the spring we would have grabbed that prospect with both hands.

The reduction in other sales, such as Tattersalls Ireland and Arqana, are harder to quantify. The traditional Fairyhouse September Sale was transferred to Park Paddocks but lost over 200 lots mostly from the lower end, while Arqana extended its boutique sale and we’ll need to wait for the Arqana October results to get an accurate picture of the French yearling market.

Using yearling sales where like-for- like comparisons can be made, namely Tattersalls Books 1-4, Goffs Orby and Sportsman’s, plus the Goffs UK Premier, we can deduce that the average and median prices recorded this year haven’t been lower since 2015. But it’s not just the fact that prices tend to improve incrementally each year in normal times, we also have to consider the upward pressures exerted by the cost of production, which brings the discussion around to stallion fees.

It’s not so much that stallion studs have individually been hiking fees in recent years. They, more than anybody, have to be sensitive to market pressures and have to ensure big quality books to get their charges away to the best possible start at stud. No, it’s the sheer number of high-priced stallions that have joined the European rosters in the past six years.

Ten years ago only 13 of the top 30 stallions in Britain and Ireland assessed by book quality stood at £20,000/€20,000 or more. By 2019 that number had risen to 22 out of 30. Another way to explain it is that the cheapest fee of the top 30 stallions in 2009 was £15,000 and by 2019 it had risen to £30,000. With more expensively produced yearlings entering the market year on year, it had already put profitability under pressure, even before Covid further muddied the waters this year. Moreover, when you consider that the quality of the broodmare population has remained pretty stable in the period, it’s all too easy to understand that even in a rising market, sellers’ expectations haven’t always been met.

To illustrate the point, we can use the core British and Irish sales.

In 2018, 2,517 yearlings were sold at these seven sales, but only 52% made enough to cover their sire’s advertised fee, plus £20,000 in production costs. A year later, the 2,543 yearlings sold included only 49% that were profitable by the same criteria. This year it is absolutely brilliant that as many as 2,336 found new homes from these seven sales, but the margins were squeezed so much that only 44% cleared the advertised-fee-plus-£20k hurdle. And, of course, not everyone shared the pain in equal measure. The sad truth of the matter is that breeders had a 50-50 chance of at least breaking even if they used a £20k-plus stallion, but for those using sub £20k stallions those odds tumbled to a 35% probability of making money and went even lower for the cheaper stallions.

As always, the yearlings by proven sires sold at a premium, with Galileo, Dubawi, Kingman, Frankel, Sea The Stars and Lope De Vega the leaders by average price. Those with yearlings by Kingman (conception fee £55,000) and Lope De Vega (conception fee €60,000) did particularly well. Among the new sires so far this year with Arqana October not included, France has provided the top stallion for the second straight year as Almanzor followed Shalaa with the only average above £100,000. The Coolmore pair Churchill and Caravaggio followed, while the best British first-season sire was Cheveley Park Stud’s Ulysses.

The three stallions with the highest percentage of profitable yearlings – the only stallions scoring over 80% – were Wootton Bassett (93%), Night Of Thunder (88%) and Kingman (85%). The best three by fee multiples were Kingman (7.3 times his fee), Sir Percy (7.2) and Farhh (6.8).