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Expectations rise for Fasig-Tipton, Keeneland mixed sales
LEXINGTON, Ky. − When you talk to auction officials and consignors about the Fasig-Tipton and Keeneland November mixed sales, the word you’re most likely to hear is “stability.” In 2008, after the economy crashed and took bloodstock prices with it, stability was so rare that sellers and auctioneers merely aspired to it, the way in more prosperous times they hoped for million-dollar horses. But four years later, auction participants are using the word “stability” with a lot more confidence.
There’s good reason for that. The sharp contraction in breeding activity has brought supply and demand into better alignment, and the 2012 November sales follow a season of mostly good, stable results at yearling sales − an encouraging sign that commercial breeders and successful pinhookers should be back to restock at Fasig-Tipton on Nov. 5 and at Keeneland Nov. 6-16.
“I think we’ve seen there’s still a significant demand for quality horses,” Fasig-Tipton president Boyd Browning said. “I think buyers will continue to be selective in November, but, all in all, buyers and sellers were pretty comfortable with the marketplace at the yearling sales, and I think it will be the same thing at the mixed sales. I think it would be premature to think there will be any overall dramatic increase in the value of bloodstock.”
As the sales approached, there were some literal and figurative clouds on the horizon, though auction officials forecasted little impact on the mixed sales.
Hurricane Sandy devastated the U.S. from North Carolina to New England just a week before the sales, but executives at Fasig-Tipton and Keeneland confirmed that horse shipments to their auctions were unaffected.
The fate of the Ontario government’s attempt to grab racing’s slots revenue from Woodbine remained unclear as the industry mounted opposition, but most of the news leading into the November sales was fairly good: Uncertainty over New York Gov. Andrew Cuomo’s plans for the New York Racing Association stabilized a bit when he named the organization’s new board; Equibase recently reported year-to-date gains in wagering and purses; and recent yearling sales showed that a diverse group of buyers was still spending on Thoroughbred breeders’ main product. Foreign currencies’ relative strength against the U.S. dollar is a positive for attracting international buyers, although concerns over the Eurozone and a less-favorable dollar-to-yen exchange rate could slow some foreign spending. Even so, sales company officials remained positive about a market that has had a strong roster of domestic buyers.
“Looking at the sale last year and the continuation from that, we’re starting to see interest returning to long-term investment,” said Geoffrey Russell, Keeneland’s director of sales.
Russell pointed to results from the Ocala Breeders’ Sales Company’s mixed sale, where average and median posted strong gains at both the consignor-preferred session (where they climbed 7 percent and 29 percent) and at the open session (up 21 percent and 42 percent).
“People realize this is the business they’re in, and they have to have stock to continue it,” Russell said of commercial breeders. “The return to profitability in the September yearling market gave people hope.”
The Keeneland September average of $87,354 was up 14 percent over last year and its $45,000 median was up 50 percent, and it wasn’t alone in reporting generally solid-to-buoyant figures. Fasig-Tipton’s July sale and France’s Arqana Deauville sale improved their averages as medians held level with 2011 figures. The OBS August and Fasig-Tipton New York-bred preferred sales rang up increases in both average and median, and Fasig-Tipton’s Texas auction saw a 20 percent hike in median as average fell marginally. Fasig-Tipton’s Saratoga selected sale suffered a 6 percent drop in average and a 10 percent drop in median after a pair of widely divergent sessions in which one night’s figures plummeted and the other night’s figures posted large gains. Last month, the Tattersalls October, Fasig-Tipton Kentucky October, and Eastern fall yearling auctions posted across-the-board increases.
But Russell cautioned that, even with better overall yearling returns, commercial breeders and professional pinhookers probably will remain conservative in restocking. After the recession’s bruising losses, many yearling sellers have described a hyper-selective market for their wares, meaning they will be selective in choosing new mares to buy or weanlings to pinhook, especially in an era of tight credit.
“I think they will be very selective, but I think they will be back in the market,” Russell said of breeders.
“We live in a world where most markets are similar to what they were a year ago,” Fasig-Tipton’s Browning said. “There might be some reason for optimism, but it’s not unbridled enthusiasm. We live in a realistic world with realistic expectations.”
Auctions of the last 12 months, from yearling sales to mixed affairs, have shown upper-market buyers still expect to pay high prices for horses they feel are top quality and have residual value. As at last year’s November sales, hefty prices could again be a feature at the top of the market. But last year’s November sales could be hard to top. Keeneland’s 11-day auction last year was fueled by the major dispersals of Edward P. “Ned” Evans and Palides Investments and rang up an $81,641 average and a $24,000 median, figures that were up 62 percent and 41 percent. Fasig-Tipton’s one-night sale also got big boosts. Led by $2.3 million Funny Moon, the sale posted a 32 percent increase in average to $414,494 and a 54 percent boom in median to $200,000.
Evans’s dispersal became North America’s highest-grossing Thoroughbred dispersal after 170 horses sold for more than $55 million, $9 million more than the previous record-holder, Newstead Farm in 1985. The second dispersal, that of the late Saud bin Khaled’s Palides Investments, produced 2011’s highest auction price when Benjamin Leon Jr., paid $8.5 million for Royal Delta. She came into the sale off her Breeders’ Cup Ladies’ Classic victory four days earlier.
This year, it could be Fasig-Tipton’s turn to post the highest price: Its catalog features the reigning Horse of the Year, Havre de Grace. The 5-year-old Saint Liam mare is the first reigning Horse of the Year to sell at auction since Lady’s Secret brought $5.4 million at Fasig-Tipton’s 1987 fall sale. Owner Rick Porter is offering Havre de Grace, Hip No. 76, as a broodmare prospect.
Fasig-Tipton’s one-night catalog also features the dams of this year’s Kentucky Derby and Preakness Stakes one-two finishers, I’ll Have Another and Bodemeister. I’ll Have Another’s dam, Arch’s Gal Edith (No. 15), is in foal to Gio Ponti. Bodemeister’s dam, Untouched Talent (No. 176), is in foal to Unbridled’s Song.
Keeneland has big names of its own, including 2011 Kentucky Oaks winner Plum Pretty (No. 96) and her dam, Liszy (No. 52); a yearling full sister to 2009 Horse of the Year Rachel Alexandra (No. 243) from Dolphus Morrison’s dispersal; dual Grade 1 winner Pure Clan (No. 279); and Canadian champion Negligee (No. 76), among other notables (see sidebar).
The Fasig-Tipton fall mixed sale will take place Nov. 5 at Fasig-Tipton’s Newtown Paddocks in Lexington, starting at 5 p.m. The sale will stream live online at www.fasigtipton.com.
Keeneland’s November breeding stock sale will take place Nov. 6-16 at Keeneland’s sales pavilion in Lexington, starting daily at 10 a.m. All sessions will stream live online at www.keeneland.com.