Buyers at auction know well that their competition for a horse in the ring is not only from the people sitting around them or gathered near the walking ring.
They also face competition from the seller through the reserve price, and this competition is getting stiffer—particularly among select horses—as an increasing number of breeder/owners are willing to take their stock to the racetrack if the fall-of-the-hammer price isn’t enough.
The buy-back rate for the opening day of Keeneland’s 12-day September yearling sale, which started Sept. 14, increased from 27.7% in 2014 to 31.2%. Higher buy-back rates often mean fewer buyers are willing to part with their money, but in the case of Book 1 for Keeneland September this rate seems to be influenced as strongly by sellers not willing to part with their horses.
A total of 68 horses failed to meet their reserves during the opening session. The median final bid in this group of buy-backs was $190,000, or 10% higher than the RNA median for Keeneland September’s first session of 2014 and 35.7% higher than the median price for first-session RNAs of 2013. Naturally as prices rise overall (the average was up 7.7% from a year ago and the median up 8.2%), RNA prices will rise, too. But over the past two years, the opening session has included horses going back home despite final bids north of $1 million.
The example from this year is a colt by hot-as-blazes sire Tapit out of Bethan (a half sister to current top-10 sire Hard Spun), who was bought back for $1.2 million. The session produced only two other horses to bring final bids above a million dollars and the average price for the first session was $297,613. But the breeder, Sienna Farms in Florida, apparently saw a lot of upside down the road and held on for the ride. Bethan, by Giant’s Causeway, has two foals of racing age: a 3-year-old colt Sierra Tango (by Smart Strike) and a 2-year-old colt by Malibu Moon. Besides her Tapit yearling, she also has a weanling filly by More Than Ready.
Barbara Banke’s Stonestreet Stables also took home three yearlings Sept. 14 it offered that brought bids totaling $1,015,000. Banke, who is starting to build on her brand by cataloging horses as “Stonestreet Bred & Raised,” is willing to show what that can mean at the racetrack.
Look no further than the opening session of the 2013 Keeneland September when Stonestreet bought back a Pulpit—Grand Pauline filly for $475,000. The farm chose to keep her and is now racing grade II winner Keen Pauline, whose next start will be Sept. 19 in the Cotillion Stakes (gr. I) at Parx Racing.
Out of the 38 buy-backs in the 2013 Keeneland September opening session that had six-figure final bids, most were not offered at another sale and went on to race. Among them, 15 were winners and two were graded stakes winners—Keen Pauline and Storm the Stars, who was purchased privately and raced by Sheikh Juma Dalmook Al Maktoum. Three other 2013 first-session RNAs later became stakes-placed, with two of these horses having placed in graded stakes.
The buy-back rate can be a complicated metric. In the second week of the Keeneland sale, this rate will be more reflective of how much the average buyer is willing to invest in racehorses. But during the first week, the RNA rate is in part a “breeder confidence index” and in the early going this metric appears to be rising.