Influx of Buyers Drives Competitive Market; Substantial Gains at Keeneland September Sale

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LEXINGTON, KY (Sept. 21, 2012) – Demand for quality yearlings from an exceptionally deep global buying bench drove strong commerce throughout Keeneland’s September Yearling Sale, producing double-digit increases in average and median prices.

Gross receipts for the 11-day sale, conducted September 10-21, totaled $219,781,500, for 2,516 horses, down just 1.66 percent from last year’s 13-day sale when 2,921 horses sold for $223,487,800.  The cumulative average price of $87,354 increased 14.17 percent from $76,511 in 2011, while the median surged 50 percent from $30,000 to $45,000.

“This was an extraordinary sale that was driven by the sheer number of people who attended and the high volume of trade they generated,” said Walt Robertson, Keeneland’s Vice President of Sales. “There were a number of new faces as well as longtime clients, and we welcomed many returning buyers, such as Juddmonte Farm, who have been out of the sales scene lately. The interest level was unlike anything we’ve experienced in recent memory.”

Strong commerce was further evidenced by the decrease in the RNA, or buy-back rate, which fell 7.78 percent to 19.20 percent. The RNA rate decreased by double-digits during six of the sale’s 11 sessions, falling to unprecedented single digits during each of the final three days of the sale. The strong clearance rate, coupled with double-digit gains in average and median prices, is a very positive indicator for breeders.

“It continues to be a highly competitive, highly selective market,” Robertson said. “In many cases, horses far exceeded their reserves, which meant there were several underbidders who then bought other horses to fill their orders. And while there were fewer horses who failed to meet their reserve, there was active trade in the RNA market as those horses were sold privately.” 

Both U.S. and foreign buyers were engaged at all levels of the market. Clientele included the world’s most high-profile owners, many of the nation’s leading trainers and a number of leading two-year-olds in training consignors. Domestic and international buyers ranked equally among the sale’s top 10 leading buyers as well as the purchasers of the top 10 highest-priced yearlings.

Keeneland officials noted that buyers were out in force well into the final days of the sale, and there was greater participation during the second week this year compared to 2011.

“The high volume of trade was accomplished despite the fact that three of last year’s top five buyers were not major players at this year’s sale,” said Geoffrey Russell, Keeneland Director of Sales. “While obviously we missed them, the September Sale is so big and so strong that other buyers stepped up and absorbed their absence. The majority of international buyers attend only one American sale each year, and that is the September Yearling Sale.” 

Mark Taylor, Vice President of Marketing and Public Sales Operations for his family’s Taylor Made Farm echoed that statement. For the eighth time in the past 10 years, Taylor Made Sales Agency ranked as leading consignor, selling 242 yearlings for $23,752,000. 

“It’s been great,” he said. “Leading up to the sale, I thought if demand could hold steady with last year, the sale would keep getting stronger as people came to the realization that ‘we’re running out of horses and we need to get our orders filled.’ What is amazing to me is to look at how few horses Darley bought. A while ago I would have thought (Darley’s diminished participation) would have led to a catastrophic downturn. But that void was able to be filled. It shows that the horse business, and Keeneland September in particular, is resilient. It’s the global marketplace, and when there’s opportunity, people are going to take advantage of it.”

Keeneland’s year-round strategic initiative to build and sustain relationships with horsemen in traditional and emerging markets remains a key to its sales success. Its intensive outreach efforts touch buyers in nearly all 50 states and every corner of the world.

‘It’s been a really solid sale because the clearance rate was higher than it’s been in a long time, and there seemed to be good depth in the middle and lower ends,” said Eaton Sales’ Reiley McDonald. “A lot of that is due to Keeneland’s efforts to develop these emerging markets. All those people coming here, buying horses that are really, for the most part, lower end in our market. It has created a really solid feel. Several years ago you couldn’t find anyone to look at your horses (in the final days of the sale). That’s not the case anymore.”

Consignor Beau Lane, who sold 17 yearlings for $1,379,000, concurred.

“We’ve had a wonderful sale. It’s the first time (since the 2008 financial crisis) that I’ve seen this kind of interest and activity,” he said. “People are really pushing to get what they want. It all goes back to supply and demand. Given the reduced foal crop, you’re going to see fewer horses in the starting gate. People are going to have to be more competitive to get in the game and get a good (horse).”

Seven yearlings brought $1 million or more compared to six in 2011. A colt by Distorted Humor out of Grade 1 winner Mushka brought $1.65 million to be the sale’s highest-priced yearling. The colt was one of 17 yearlings purchased for $8,250,000 by Sheikh Hamdan bin Rashid al Maktoum’s Shadwell Estate Company Ltd., the sale’s leading buyer.

Demi O’Byrne, on behalf of the Coolmore partnership of John Magnier, Derrick Smith and Michael Tabor, paid the sale’s second-highest price of $1.55 million for a colt by Bernardini. Out of the Carson City mare Wilshewed, the colt is a half-brother to Grade 1 stakes winner Stormello and 2012 Del Mar Derby (G2) winner My Best Brother.

A half-sister to Grade 1 winner Bodemeister was the sale’s top-priced filly, selling for $1.3 million to Donato Lanni, as agent for John Sikura and Bruce Lunsford.

On Friday, Keeneland sold 146 horses for $1,805,000 compared to $1,860,800 for 197 yearlings in 2011. The day’s average of $12,363 increased 30.88 percent from last year’s $9,446, while the median rose 33.33 percent from $7,500 to $10,000.

Travis-Morgeson VI paid $50,000 for Bullish, a colt by Giacomo out of Slam’s Honor, by Grand Slam, to top Friday’s session. The colt was consigned by Taylor Made Sales Agency, agent.

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