11/16/2007 12:00AM

Multiple forces spur influx of foreign buyers

EmailLEXINGTON, Ky. - Keeneland's sale grounds have been filled with foreign shoppers in November, thanks to a weak American dollar, strong foreign racing economies, and marketing by Kentucky breeders and sales companies.

Buyers from more than 40 nations - including France, England, Russia, the Ukraine, the Philippines, Australia, Denmark, Korea, and Argentina - have flocked to Kentucky this year. Many of them got a boost from favorable exchange rates.

British and European buyers, in particular, benefited from the exchange rate. The British pound has been worth about $2.05, and the euro worth about $1.46 this week. The Canadian dollar also had climbed from about 87 cents last year to $1.02 as of Friday, and the Australian dollar is now worth 89 cents in America, up from about 75 cents last year.

"I remember not that long ago, when I did a bill for a horse I bought for $30,000, I had to add 40 percent on it," said Canadian bloodstock agent Dennis Richard Ejack. "That's a lot of money, and that was a drawback."

Bidders with strong currencies, like Ejack, have said the exchange rate allows them to "buy more class" than they otherwise would and means they can bid earlier in the auction than they used to, when prices tend to be higher. But foreigners' reasons for attending the sale often had more to do with personal wealth and the economics of their local and regional Thoroughbred industries.

"The exchange rate is the icing on the cake," said Chauncey Morris, director of business development for the Kentucky Thoroughbred Association/Kentucky Thoroughbred Owners and Breeders, whose emerging markets program aggressively promotes Kentucky sales overseas. "There are other extenuating circumstances that influence owners and breeders to come here."

Cases in point: Ukrainians and Russians, whose respective currencies, the hyvrnia and the rouble, stood at 19 cents and 4 cents on Friday. For these and most other foreign buyers, the decision to spend money at Kentucky auctions comes down to issues like the booming energy market that has benefited players in the oil and natural gas industries.

Ejack, who represented several new clients from Alberta, Canada, at the 2007 November sale, said the rising cost of the province's oil and the prospect of a new racetrack in Alberta are driving interest in horses there. So is a hefty incentive program for mare buyers.

"We have a unique program with our mare purchase program that reimburses our clients who buy their first mare by 30 percent," said Ejack, who had purchased both mares and weanlings at the auction. "That's quite an incentive along with the currency. If you do the math, look at how much stronger our dollar is and the good programs at home, even though the prices are higher here, you're still buying at a pretty good clip."

For Nicolas Benedicto, whose father, Ricardo, is Argentina's leading owner, the big draw of the Keeneland November sale is the large number of horses on offer.

"In Argentina, it's very difficult to get good fillies and mares, because the breeders want to keep them," said Benedicto. He said a local agent told them about the Kentucky auctions back in 2005, and they quickly saw the appeal. "I think the best genetics are here in America, and here you have 6,000 horses in 14 days. For sure, you will find something you like."

The bigger picture in Argentina also offers plenty of reason to upgrade local bloodstock, Morris said. The commodities market is on the upswing, lifting Argentina out of its past economic crisis. And racing is healthy, especially now that a popular new racino has opened in neighboring Uruguay.

Said Morris: "Their big races, like the Carlos Pellegrini or the Gran Premio Nacional, for purses four years ago that were around $100,000, they gave away $300,000 for the Gran Premio Nacional last week. Those increases are going across the board for maidens and allowances."

The main impression Kentucky's Thoroughbred trade missions must combat, Morris said, is the idea that all horses at Kentucky auctions cost $1 million or more.

"Everybody thinks if they come here, they're not going to be able to play because it's too expensive or the horses left over are not going to do well," he said.

Benedicto provides a handy example to counter that impression. He paid $35,000 for Lady Sprinter, an Orientate filly, late in Keeneland's 2005 September yearling sale. She is now a Grade 1 winner in Argentina.

"We bought eight fillies there, and from the eight we have six that have started, and five winners," he said. "The Grade 1 winner has run six times and won six times. They have done pretty well."

Day 12 numbers up significantly

The November sale ended its 12th of 15 sessions Friday with another series of big gains. The Friday session sold 230 horses for $3,935,400, up 32 percent from the equivalent day last year, when 226 horses sold. The 2007 average was $17,110, an increase of 30 percent; the median of $11,250 was up 41 percent.

The day's top price was $220,000 for the British-bred Zafonic mare Eshaarat, who was cataloged in foal to Southern Image. Lakeview Stud purchased the 7-year-old mare from Stonestreet Thoroughbreds (Gainesway, agent). Eshaarat already is the dam of French stakes-placed Untitled Blues.

The top-priced weanling was a $150,000 Van Nistelrooy colt out of the Lost Code mare Classical Code. Lynn Lodge Stud purchased the Pennsylvania-bred bay weanling from Margaux Farm, which was acting as agent for Beth Ann Brown-Gambone.

Through Friday, the two-week auction had sold 2,896 horses for a sale-record $336,627,500, a rise of 8 percent on last year's 12-day cumulative numbers. The first 12 days sold 2,861 horses in 2006. The 2007 average price of $116,239 was a gain of 7 percent from last year, and the $45,000 median was up by 7 percent.

The sale, which this year cataloged a record 5,415 horses, continues through Nov. 19.