After nearly four years of trying to get back on stride, the Thoroughbred marketplace is enjoying sustained progress even if it's not quite moving at its previous breakneck speed.
For all the black eyes the racing industry has endured of late, with battles over race day medication, expanded gaming and controversial media reports, public auctions have been a testament to the industry's resiliency as it continues to dig itself out of the downturn that coincided with the economic crash of 2008.
With the juvenile sales season producing upturns, and gains becoming the norm in all segments of the marketplace, there is an abundance of good vibes heading into Tuesday's Fasig-Tipton Kentucky July yearling sale, the first major yearling auction on the calendar.
As yearling sales go, so goes the health of the industry.
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The decline in numbers of foals bred each year has put the supply side of the equation back in line with demand, but other upswings in racing are contributing to renewed buyer enthusiasm. Purses and handle for U.S. racing have improved, and even though the foal crop is contracting, the number of race days is up nearly 2 percent compared with this point last year.
"People are encouraged. Encouraged but still being very realistic," Fasig-Tipton president and CEO Boyd Browning Jr. said. "They're not looking for dramatic increases, but there is continued positive momentum and continued positive interest and demand for horses.
"I think that is somewhat a factor with supply and demand. We're seeing a dramatic decrease in the number of horses that are produced, and yet, our racing dates are still fairly similar. So we still need a similar number of horses as we've needed in the past."
The one-day July sale slightly increased its catalog this year, with 338 horses entered, compared with 303 in 2011. The boutique Fasig-Tipton Saratoga sale in August will test the top end of the market and Keeneland's marathon September yearling sale will provide the truest barometer on the industry's health, but the July exercise could provide a couple of key readings on other fronts.
As always, the July auction is heavily loaded with offspring of first-crop sires, thus making conformation more than pedigree a main criterion. Buyers have strongly shifted their favoritism toward proven stallions during the correction, but increased confidence in the market could see shoppers become more willing to take a chance on an unknown commodity.
"It's too early for me to tell, but (that attitude) could be shifting," said Duncan Taylor of Taylor Made Sales. "If you do hit with the right one, you can get some bargains. People used to want to buy the first-year stallion more than they would a sire like Phone Trick or City Zip or Northern Afleet, who all get good runners. But with the climate change, that changed around a bit."
With less-commercial horses going out of production, the quality at even the bottom end is coming up a level. Polarizing as the market remains for horses with marks against them, fewer of those who simply don't belong are getting into the catalog.
"It's getting a lot better," said Guinness McFadden, sales director for Three Chimneys Farm. "Two or three years ago, there was no market for the low end. Well, that part of the market has disappeared. Now, the low end is so much higher quality than it was five years ago, it's not as much of a struggle (to sell those horses). And there is so much more trade in that area than there was three years ago.
"It's definitely positive signs, but I don't feel like we're going up just yet. I feel like we're bouncing around on the bottom now."
The July one-day sale begins at 10 a.m.