It will be a tough for Aussie’s in the horse business for 2020 but if you are looking towards the 2022-3 Yearling sales it is great year.
We have already seen some studs lower prices, broodmare prices will begin to bottom in July, the Owner/Breeder and the recreational owners will take a beating this year so it will not be a great year for the studs.
The fact that Australia kept racing going has saved the industry from a complete bloodbath, but there will be still some pain over the next year.
While the top end Commercially bred horses, rich guys selling expensive horses to other rich guys seen a significant downturn at the Inglis sale expect the non commercial market to take some serious damage.
Inglis did an amazing job of delivering a quality sale even after Arrowfield bailed, a decision that may have actually helped the Inglis Sale.
Now for the good news
As huge numbers of Australians are suffering under the lockdown conditions and a segment of the economy almost grinds to a halt many owners will struggle to retain their much loved horses over the next year, Syndicators will have their work cut out for them making new sales and retaining existing customers.
Nothing will be further from their minds than sending a mare off to an expensive stallion, but it will be the best year ever in Australia to do that, by 2022 The Fed would have printed the US economy back to boom time, the sheep at the Reserve Bank will follow suit, things will be good and the world bursting at the seems with cash, the pain would have been successfully moved down the line to future generations and our industry sold off to foreign investors.
While we can cast judgement on those moral choices, they are not ours to make, what we can do is send a few mares to some of those big stallions and make a quid in 2022-3.
Economic Notes on Timing
The earnings reports coming out in July will be the ugliest, the ones we are seeing now remember were started in February with Lawyers and Auditors dicking around with them endlessly to justify their existence, the same overly cautious bunch will be starting on the July earnings and outlooks now, they will be horrendous.
July should see a strong sell off, that is the one you want to save your cash for buying long term assets.
If you are one of the many looking for bargains in other non-trading assets like real estate, boats, cars, horses July will be the ideal time as well.
The good Samaritan mood sweeping the banks will be over, they will come crashing down on those poor unfortunates a few payments behind and real assets will be for sale at a discount.