08/02/2002 12:00AM

Will Wall Street hurt yearling prices?


LEXINGTON, Ky. - Fasig-Tipton's flagship Saratoga selected yearling sale is coming off two record years, and company officials say they believe this year's auction, which starts Tuesday, will produce sound returns this year, even if the sale doesn't equal last year's level.

"The core component of the Saratoga sale, our catalog, excites us this year," said Fasig-Tipton chief operating officer Boyd Browning. "The nuts and bolts are there, and they're good. But we could have a very, very good sale and still have a decline in average. A decline would not mean there's a problem in the overall market."

The 2002 sale has cataloged 228 lots, slightly down from last year's 237, and features both new and familiar pedigrees. Sires include a pair of champions from the 1998 Triple Crown races, Kentucky Derby and Preakness winner Real Quiet and Real Quiet's Belmont spoiler, Victory Gallop. Charismatic, winner of the 1999 Derby and Preakness, has a colt and a filly in the catalog. All three stallions have their first yearlings this season. Proven sires include Saint Ballado, with five colts and five fillies, and A. P. Indy, who has a pair of fillies and four colts, including the first foal out of Grade 2 winner Sapphire n' Silk.

Last year's auction enjoyed a dramatic upswing, setting a record average of $385,259 and a nearly 50 percent increase in gross as 162 lots went for $62,412,000. Median rose 24 percent to $235,000, and buybacks were 19 percent, a low number in a market that has become used to seeing 30 percent buybacks. Despite such success in 2001, Fasig-Tipton officials are only cautiously optimistic because of the difference in the market this year.

Corporate accounting scandals and a wildly bucking stock market may cause some buyers, especially in the $75,000 to $250,000 range, to grip their wallets more tightly. But the part of the select yearling market that could weaken most is the highest echelon, which traditionally has produced horses over $1 million.

The deaths of popular established stallions like Mr. Prospector and Seattle Slew have left voids in boutique catalogs. Storm Cat, still a potent auction force, has fewer purely commercial lots available now that his fee has escalated to $500,000 - beyond the reach of most commercial breeders - and Coolmore has purchased a number of lifetime breeding rights to him. The Saratoga sale has a pair of Storm Cats: a filly out of champion 3-year-old filly Sacahuista (Raja Baba) and a colt out of Grade 1 winner Shared Interest who is a full brother to Grade 1 winner Forestry and a half-brother to champion juvenile filly Cash Run. A third Storm Cat, a colt out of Grade 3 winner Colcon, originally was cataloged but was withdrawn five days before the sale by WinStar Farm.

"There's no question the top of the market is undergoing changes," Browning said. "We're in a situation where no one is ready yet to fill the shoes of Mr. Prospector and Seattle Slew. That's not to say someone won't, but right now it's impossible to replace that sire-power in the immediate, short-term horizon."

Among buyers, the upper-market's complexion also has changed with the unexpected death last month of Thoroughbred Corp. owner Prince Ahmed bin Salman, 43, a regular select-sale bidder above the $1 million level. It's unclear what the organization's plans will be under its new principal, Salman's younger brother Prince Faisal.

"The apparent loss of The Thoroughbred Corp. from active participation in the current market leaves a void," Browning said. "I think the entire industry is pleased that Prince Faisal will be overseeing The Thoroughbred Corp. operation, and we all hope the tremendous success they've enjoyed will continue. However, none of us knows at this time what their short-term or long-term activities in the auction arena will be."

The select yearling market got a shock right out of the gate this year when the season's first boutique auction, Keeneland July, slid about 30 percent across the board.

The results sent jitters among late-summer and fall sellers concerned about a potential market collapse, but that fear has faded somewhat and the prevailing hopeful view is that Keeneland July was an aberration. The Fasig-Tipton selected yearling sale in Saratoga has cataloged 229 lots and runs from Tuesday through Thursday. Evening sessions begin each night at 7:30.