How quickly it takes to fully recover from an ailment often depends on what, if any, setbacks occur during the healing.
With the first major auction of the new year now in the books, the Thoroughbred marketplace succeeded in drawing another healthy breath devoid of major complications.
On the heels of a 2011 sales season that produced sustained upswings for the first time in three years, the Keeneland January Horses of All Ages sale picked up the mantle of momentum during a smashing four-day run that concluded Thursday, producing its highest overall numbers since 2008.
After a market free-fall for a couple of seasons once the correction hit full force toward the end of 2008, stability has edged back into the auction arena for the better part of a year as buyers and sellers adjusted their expectations, their level of stock and — most important — their budgets.
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Like the 2011 Keene land September yearling sale and the November breeding stock auction, the January sale was able to surpass its gross from the previous year days before it reached its final session. The overall receipts of $37,991,900 from 1,003 horses was up 50.48 percent despite this year's sale being one day shorter than the 2011 edition. The average of $37,878 and median of $15,000 jumped by 53.03 and 100 percent, respectively.
The rate of horses not sold came in at 19.7 percent, a 27.8 percent improvement from 2011.
In addition to having supply and demand back in line after years of overproduction, there is a sense the current market is accurate and fair. Dispersals such as the ones by the estate of Edward P. Evans, Chanteclair Farm and Overbrook Farm in recent years had no reserves, helping participants get a real read on horses' values at all levels.
"Having dispersals with no reserves tells you what the market is, and that has helped dramatically," said Geoffrey Russell, Keeneland's director of sales. "We just had to get confidence back in the market, and people have been able to evaluate their horses again. After 2008, that was very difficult because nobody knew what a horse was worth.
"This is a continuation of where the market is at the moment," he said of the January sale. "Everybody seems to be happy, both buyer and seller."
The competitive bidding that drove the November sale worked to January's advantage. Not only was there ample money left for desirable broodmares such as Grade I-producer Topliner, purchased by Katsumi Yoshida's Northern Farm in Japan for a sale-topping $1.4 million, but newly turned yearlings were equally popular as resellers sought to fill their inventories for the year.
"The market's been bloody good here ... and what's impressed me is what the yearlings are making," said agent Tom Goff of Blandford Bloodstock, who bought Magnificent Honour, a full sister to champion Rags to Riches, for $600,000 on behalf of an undisclosed client. "We have a catalog in which obvious broodmares and yearlings stand out, and we all fall over each other on the way to the ring."
As the market continues to dig itself out and production eventually increases, sustaining the tide's rise will become more challenging. Because those who are investing are largely doing so on their own dime due to the lack of credit, there is hope the up-and-down cycles of the industry will become less volatile.
"I think the difference between this recovery and any previous recovery is there is less credit, so people are going to be doing this out of their own pocket," Russell said. "When you spend your own money, you're more careful."