With the economy still struggling and the Thoroughbred marketplace taking some big hits late last year and earlier this year, there was more anxiety than usual heading into the Fasig-Tipton Kentucky July select yearling sale. As expected, the auction was down from a year ago in three important statistical categories: gross, average price, and median price. But some comfort could be taken because, for the first time in a while, sellers and auction company officials seemed to have a good grasp on where the market would be.
Downturns of 40% or more in breeding stock prices were shocking to many people, and when the selling season for select 2-year-olds training started, no one seemed real sure how much prices would be down. But prior to the Fasig-Tipton Kentucky sale, which kicks off the yearling selling season, most people predicted the downturns would be in the 20% to 30% range, and they were right except in the case of the average which declined less than 20%. Finally, they seem to know where they stand.
Because of its smaller size and the higher quality of its stock based on pedigrees, the Saratoga select yearling auction has a decent shot at a better performance. The biggest challenge will be the Keeneland September sale because of the huge number of yearlings it pours into the marketplace. But the grapevine is telling us the auction will be smaller in size, which will be a positive development at a time when the supply of young horses is outstripping the demand.
Here are some other thoughts about the Fasig-Tipton Kentucky auction and the market for yearlings:
It would be an exaggeration to say buyers are abandoning unproven stallions in droves and flocking to the stock of veteran sires instead. But consignors and shoppers both are commenting on the cool down in the popularity of first- and second-crop stallions, which were white hot commodities earlier this decade because of the blue sky-only appeal of their offspring. And that's how it should be. Young stallions, no matter what they have accomplished, should enter stud at reasonable prices (rarely $100,000 or above, if at all) and then to work their way up the stud fee ladder based on the success of their offspring at the races. Their early supporters in the breeding shed should have an opportunity to make money as a reward for the risk they are taking. And older stallions should be given more credit for what they have accomplished and not ostracized just because they have one bad year. When the auction game was booming, everything got too far out of whack, and one good thing about the recession (or depression) is that it will get the situation back more in balance. Medaglia d'Oro's sale success - with both colts and fillies - wasn't a shocker with Rachel Alexandra's dominating performances fresh in the minds of buyers, but it was nice to see the underrated Birdstone (sire of two classic winners) right up there, too, with a $400,000 colt even though his offspring aren't usually as big and flashy as the "Medaglia" bunch.
Murray Smith doesn't mind if you call her move to the West Coast a midlife crisis, but based on her past success, nothing the pinhooker does should be taken lightly. She says she's found a group of people, new to the Thoroughbred business, who are eager to invest and their financial clout was great enough to make her Divine Assetts pinhooking and racing venture the second-biggest spender at the July auction. There is a lot of talk about going out and finding new owners from industry leaders, and maybe they could learn something from Smith, who is scheduled to be at the Saratoga auction looking for more horses.
Fasig-Tipton officials, with their barrage of social events and facility improvements, are making what could have been a miserable auction slog a lot more fun. It will be interesting to see what all they come up with for the Saratoga sale, which they have vowed to make the world's premier yearling auction. They haven't reversed the market's downward trend, but they're keeping their customers entertained, well-fed, and well-lubricated, which is something people do appreciate, especially when times are tough. And if you think I'm praising Fasig-Tipton because I've enjoyed the parties, think again. I haven't been to one this year in either Florida or Kentucky.
Triple Crown winner Seattle Slew, a graduate of the 1975 July sale, is the broodmare sire of both this year's $400,000 Birdstone colt and $350,000 Rock Hard Ten filly. Seattle Slew also was the cover horse for this year's July auction catalog.