Looking back on the past 12 months, the horse racing industry endured a year filled with a seemingly endless array of peaks and valleys.

There was euphoria through the heroics of horses such as Cody’s Wish, Arcangelo, and Mage. Yet there also were unsettling challenges in the form of a spate of fatalities at Churchill Downs and Saratoga Race Course and declines in wagering, purses paid, and race dates.

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To discuss several of the important issues facing the sport as a new year approaches, BloodHorse has assembled a panel of about 30 industry participants to participate in the 2023 Year-End Survey where they can provide their thoughts on six key topics and generate meaningful discussions on these issues.

The series starts today with a question on racing surfaces. In the following days panelists will be asked to provide their thoughts on foal crop size, racing calendar/field size, the Horseracing Integrity and Safety Authority (HISA), marketing, and wagering.

While BloodHorse realizes there are countless other voices that could have been included, the hope is that these answers will spark meaningful discussion within the industry. Anyone who would like to offer their opinion is encouraged to submit them in writing to editorial@bloodhorse.com for inclusion in our Letters to the Editor. Longer pieces can be considered for an Our Voices column.

TODAY’S QUESTION: What are some things the industry could do, or your organization could do, to turn around the declining foal crop numbers? Or does it make sense for the sport to plan to be smaller in the years ahead and chart a path forward with those expectations?

Shannon Arvin, president and CEO, Keeneland: Let me start by saying that a reduction in the foal crop may not be entirely negative, as previous numbers indicated an overproduction, with many non-commercially-viable foals born annually. That said, we certainly want stabilized foal crops going forward. Two observations about what I feel is contributing to the declines follow. We’ve seen steep declines in the regional markets, where a lack of infrastructure deters people from being able to expand their programs outside of Kentucky. For growth, they need healthy local racing programs with sustainable purse structures, breeders’ awards and stallion awards, and programs to develop racing fans. A number of important racing states failed to invest alternative revenues effectively into growing the sport and industry. For that reason, there needs to be a public push to educate legislators in regional areas about the importance of the horse industry to their localities. Also, the polarization of the sales market and stud fees continuing to rise will make it tough to grow the foal crop. More breeders are paring down their mare numbers and focusing on quality over quantity. Control of various sectors of the industry, such as breeding, racing, wagering, etc., has become very centralized, and a more evenly distributed ecosystem would be beneficial for the foal crop and ultimately, for the sport.

Dr. Dionne Benson, chief veterinary officer, 1/ST Racing: Frankly, we do not have a foal crop decline – we have an owner decline. If there were more demand for foals, there would be an increase in breeding. The lack of demand is in my opinion due to, in part, a shift from most people who owned racehorses as a hobby versus now more owners see them as a potential business. Therefore, if we are going to make this an attractive business for those individuals, we need to find ways to make it more affordable for the trainer and owner. Are there ways to use volume purchasing power to decrease hay, feed, and medication costs? Are there ways to improve costs for trainers for Workers’ Compensation insurance? If we can decrease those costs, they can be passed along to owners who may see this as an opportunity to have an amazing hobby that also is affordable.

Louis Cella (Coady Photography)

Louis Cella, president, Oaklawn Park: This is a huge issue and participants within our industry need to get together and have a candid discussion. Breeders, tracks, horsemen, everyone. The decline in foals is so alarming that many tracks will simply go out of business. And, yes, we are preparing for fewer foals. The horse shortage is very real.

Brad Cox, trainer: Breeders in Lexington say having “B” and “C” level tracks are very important for the sport in order to create opportunities for horses. All of the horses in a crop will not compete at the top tracks and these tracks allow more horses to compete. That may not increase the foal crop but at least it can maintain the foal crop level.

Dennis Drazin, CEO and chairman, Monmouth Park: In New Jersey, we have increased our foal crop (albeit we are down from 20 years ago) by adding breeder incentives. Our New Jersey-breds run for 25% more in a restricted race and 40% more in open company. Creative incentives for state-bred races can increase state-bred crops. I do remain concerned that our national foal crop size is decreasing and we will have to live with that reduction and plan for ways to address it. I think a breeder/farm owner think tank should be formed.

Drew Fleming, president and CEO, Breeders’ Cup: While there are many state-bred incentive programs available for breeders and owners, these vary greatly depending on location and available resources. The industry needs to keep investing in its product in order to provide opportunities for breeders to succeed and increase their operations. The breeding industry is the foundation of the Breeders’ Cup program, which we have administered for 40 years. During this time, the Breeders’ Cup has allocated purses and awards in excess of $900 million to owners, foal nominators, and stallion nominators through the Breeders’ Cup Challenge Series: “Win and You’re In,” the Dirt Dozen Bonus Series, and the $31 million Breeders’ Cup World Championships. We recognize the many challenges breeders face, and we are committed to continuing to support them through the world-class program we have developed, which is overseen by our board and members, all key industry constituents.

Jim Gagliano, president and COO, The Jockey Club: Tough question. It’s an expensive sport for owners and that is why partnership and fractional ownership participation have increased in recent years, which has been very important to the sustainability of the sport. While contraction of the foal crop is difficult to reverse, there is an opportunity to foster growth in regional markets where a very significant portion of the reduction has occurred. As such, any efforts to help grow regional markets, including incentive programs designed to attract better stallions and mares, would help. The Thoroughbred Aftercare Alliance was founded on the principle that everyone would give something to support the transition of horses from the racetrack, but as one of the principal supporters of the TAA, we are not seeing that transpire. Our industry spends a lot of money for aftercare, but it is not enough to care for the population of horses exiting the track every year. Thoroughbreds in a second career should not be looked upon by the industry as the wastage of the sport of horse racing, or as a failure of a breeding program. Thoroughbreds have value: they are Olympic athletes, therapeutic horsemanship partners, kids’ hunter/jumper mounts, adult trail horses, and more. Any path we chart forward to improve the sport and breeding needs to include Thoroughbred aftercare and alternative careers for our horses.

Eric Hamelback, CEO, National Horsemen’s Benevolent and Protective Association: I don’t believe my organization can do anything. We are not in charge and never have been. On the contrary, the same breed registry has been in charge of protecting the Thoroughbred breed since 1894. While the foal crop has seen its gains and losses in my professional career, it has seen a steady decline since 2010. Only one year, 2015, was there a half-of-a-percent increase in the foal crop, yet from 2010 to 2022 our foal crop dropped more than 30%. If we continue on our current path, there is no question the industry will constrict. Among other factors, the foaling crop has a direct correlation with the potential profit that one can realize from racing after breeding or purchasing horses commercially. When the profit margins are cut due to the excessive expenses now being laid on horsemen in the industry – and when new participants are discouraged from entering the industry because of draconian penalties and lack of due process, transparency, and accountability – there is no question our industry will contract. One thing we should keep at the forefront: It’s not a horse shortage we have, it’s an owner shortage.

Dottie Ingordo-Shirreffs, consultant, Thoroughbred breeding, racing, and management: This is an interesting question with many layers. In life, opportunity is key. With a few stallions having such large books, it has limited the number of mares available to others. With costs escalating, we need to afford the owner/breeder a chance to create income and profit with his/her mares. In racing, we need to grant all owners purses worthy of their investment and costs. Due to gaming, several states have more enhanced purse structures than others. We need to create more equality here and share the wealth for all racing jurisdictions to be strong. They do this in other sports to make teams more competitive and create income. We don’t need to make the sport smaller. We need to enhance the opportunity for more states to be successful. We have breeders’ awards. Let’s now strive to provide racing awards. Bret Jones had some thoughts on this to help our sport and his ideas truly need to be investigated and embraced.

Lisa Lazarus, CEO, HISA: We believe that the chances for the foal crop to go up can only be maximized if HISA ensures the safety and integrity of the sport. If HISA is able to increase confidence in the safety and integrity of racing, and therefore in racing’s future prosperity, we believe owners and breeders – and potential owners and breeders – will see increased value in investing in and being a part of Thoroughbred racing for years to come.

Dan Metzger (RTIP photo)

Dan Metzger, president, Thoroughbred Owners and Breeders Association: Perhaps the second-most important issue facing Thoroughbred racing is the decline in the foal crop. Several years ago TOBA convened a meeting of our member state breeders associations to discuss the foal crop. The primary reasons cited for the decline included negative economic conditions and a smaller owner base, especially in the regional markets. While the foal crop has dropped approximately 50% in the last two decades, several states, including Kentucky, Indiana, New York, and Pennsylvania, have fared better than the rest of the country, due in part to strong racing and breeders incentive programs and a healthy racing environment. Racetrack closures have also contributed to the drop in the foal crop. A number of these track closings have occurred in major metropolitan areas, negatively impacting our fan base, as well as current and potential owners. The sport must address the rapidly changing economic and societal changes and if the foal crop continues its decline, we must adjust accordingly, specifically with the racing calendar.

Terry Meyocks, CEO and president, Jockeys’ Guild: The industry needs to focus on bringing out all the positives of our sport to mainstream media, including focusing on equine and human athletes. By sharing the stories of the horses, jockeys, backside, etc., you create an experience that people will want to share and be a part of. This will attract much needed new individuals to our sport. The industry needs to do a better job of informing the public of not only the changes in the new safety measures, but also to provide evidence that these efforts are having real results. This will increase the interest in participating in racing. Obviously, more people attracted to the sport will create a greater demand for the foal crop, and breeders may be more inclined to meet the increase. There needs to be greater cooperation between the breeding and the racing industry. The racing industry, too, should consider for the next generation of breeding, whether it’s for speed, synthetic surfaces, turf or distance dirt races. Furthermore, the breeding industry must be held to a standard to ensure that the foal crops are producing horses which are sound and durable to prevent injuries and foster longer racing careers. There are certain changes that have been inevitable and we must plan accordingly. Over the last decade, a number of racetracks have reduced race days and the number of races and are continuing to do so, while others have permanently closed. It is essential that the Thoroughbred industry, as a whole – including the breeding and racing industries – recognize the need to move forward in a responsible manner while providing the best product available.

Ron Moquett, trainer: Supply and demand. Unfortunately, I believe we are in the retraction phase now. The first thing we must do is make horse racing more attractive for people to be involved with. We’ve spent so long letting the perception be pushed that people in horse racing don’t like horses or that you’re all greedy if you’re in the sport. It’s a wonder to me that people who care what their friends and neighbors think about them are still in it. I find myself spending much more time defending misleading perceptions than I do promoting the sport. It’s hard to march forward with any plans of progress when you’re constantly on your heels in a defensive posture. Hire a spokesperson or group to educate and promote our sport. Provide transparency for the public and make it OK to be involved in the sport again, and the numbers of those wanting to be involved will go up.

Graham Motion, trainer: There is going to be less horses racing and we need to adjust accordingly and do it better. Quality over quantity and I don’t necessarily mean the quality of the horses competing, but the way that racing is managed.

Mike Mulvihill, president, insights and analytics, FOX Sports: Between declining foal crops and declining starts per horse, industry contraction seems inevitable. The sport will consolidate around the best and most premium meets, which means fans will be more likely to engage with the sport via TV coverage, which isn’t necessarily a bad thing as the fan development model for all major sports is occasional live attendance and frequent media engagement.

Joe Orseno, trainer, president of the Florida Thoroughbred Horseman’s Association: Part of the reason why we have declining foal crops is that the middle market of end users has shrunk. It is no longer economical to breed yearlings unless you can reasonably expect to sell for over $50,000, and what incentives does a buyer have to campaign a horse at a track with low purses? Between training fees, vets, vanning, registration, jockey mount fees, and shoeing, it costs owners $4,000-$5,000 per month. So, unless a horse competes at the allowance or stakes level, it is nearly impossible to break even on a consistent basis. If we want to encourage owners to buy and campaign horses at the lower level, there needs to be better opportunities for them to earn more money.

Mike Repole, owner, commissioner National Thoroughbred Alliance: I think spending time planning on decline is a defeatist attitude. I think we should gather in one place, people from all ends of the industry, and have a round table where we have a real agenda with real issues and we have some tough conversations. Then all of a sudden you can make decisions. The only way this sport thrives is if everyone has a seat at the table and we trust a third party to make decisions based on the best interests of the sport. At the end of the day that might impact somebody negatively but if it’s good for the growth of the sport then people have to accept it. Right now people want the sport fixed as long as it doesn’t affect what they are doing. To me that’s a selfish attitude. Why can’t we have revenue sharing like the NFL? If you want to take 10% of my earnings as an owner and spread it around for the good of the game, I’m for it. Nobody is working together to grow the sport, which is stupidity. There isn’t a business mind in this sport that impresses me. We need to grow the sport. The way to grow the sport is dealing with issues and fixing them. The level of frustration for almost everyone in the sport is at an all-time high. Once we make positive changes we can market the sports to fans, gamblers and owners. Let’s grow the sport.

Tom Rooney, president and CEO, National Thoroughbred Racing Association: It’s critically important that we keep and attract new owners to our sport, whether it be in a syndicate or at an individual level. While we keep trying to do everything we can to bring in new people, it might be inevitable that the foal crops might settle into a number that’s more in tune for where we are as a sport currently and where we are going in the future. However, we don’t want to get to the point where there is a very small group of people that own all the horses that are competing at a couple elite tracks. It would be like having Major League Baseball without the minor leagues – how would you know who the best players are, what the upcoming talent looks like, while allowing everyone to participate?

Tom Ryan, managing partner, SF Bloodstock and Racing: I honestly feel there’s an excellent supply-demand balance in the current marketplace. My sense is the numbers will stabilize with management. A supermajority of people now breed to sell as the industry has evolved over the last two decades. Our commercial market seems right at capacity, in my opinion. We need more focus on quality over quantity.

John Sikura (Anne Eberhardt/BloodHorse)

John Sikura, owner and president, Hill ‘n’ Dale Farms: Declining foal crops are strictly an economic expression of the fact that it’s tough to succeed as a breeder. Stud fees are too high and costs have outpaced purses in real dollars. No one decreases production of any commodity with steady or increasing demand. This trend will continue unless the above issues are addressed. To date all factions of our industry are about short-term gain and the overall health of the industry is not a forefront issue. If you look at California we could be on the verge of losing an important state in our industry. We have not lifted a finger to be contributory to a solution or share lucrative subsidies in a way that helps everyone. The graded stakes committee continues to downgrade Grade 1 races in the state; further exacerbating this exodus. No California racing will further reduce the foal crop.

Nick Tammaro, track announcer at Sam Houston Race Park, handicapper: Well, I don’t work at a farm, nor am I in the bloodstock business, so I can’t do anything to create more foals. On the flip-side, we need less racing. We also need to simplify conditions that are used in racing offices that simply give horsemen far too many options. The declining foal crops will make it harder to simply have the requisite number of horses to conduct the same number of programs. We also need a drastic reduction in graded stakes. We have far too many, specifically Grade 1s. The tail is wagging the dog in this situation and the real race has become seeing how quickly horses are whisked off to the breeding shed. This is not sustainable long-term. The game has contracted in the last 10 years and will likely do so on a larger scale in the next 10. We’ve lost, or could lose, racetracks in metro areas like San Francisco, Los Angeles, Miami, Chicago, and Boston. These are huge population centers where it will be that much harder to develop racing fans without any on-track product. One thing that we can largely agree on, and horseplayers are the biggest contrarians around, is that nothing helps develop fans like the on-track experience.

Najja Thompson, executive director, New York Thoroughbred Breeders: Between the New York Thoroughbred Breeders and The New York State Thoroughbred Breeding & Development Fund we have worked together to make it as attractive as possible through program incentives, awards, and initiatives working alongside the racing stakeholders in New York including NYRA, NYTHA, and Finger Lakes Gaming and Racetrack to make the Empire State the most attractive place to bring your mare and foal a horse eligible to participate in our state-bred program. We have increased our breeder awards for New York-bred progeny sired by New York stallions and for those sired by horses outside of the state to historic rates. We have worked with NYRA to ensure New York-breds have an attractive year-round racing program. At Finger Lakes, we have cultivated an attractive purse schedule for New York-breds to compete and advance through their race conditions. Our state-bred program features an attractive stallion stakes series that features over $2.3 million in purses, and we have secured purse parity for New York-breds on the NYRA circuit starting with 2-year-olds in 2026 that increases the value of New York-breds at the sales. Ultimately, we all must make it attractive with incentives and improving economic conditions for more individuals to breed horses which hopefully will lead to increasing the national foal crop.

Note: TOBA and The Jockey Club (through a subsidiary) are co-owners of BloodHorse.