News

Keeneland's January sale could point way to more stable times

Darrell Brinkerhoff led Hip no. 3 to the sales ring at the Keeneland Horse of all Ages Sale at the Keeneland Sales Pavilion. Hop no. 3, a bay filly out of Lemon Drop, was the first horse in the ring to start the sales.
Darrell Brinkerhoff led Hip no. 3 to the sales ring at the Keeneland Horse of all Ages Sale at the Keeneland Sales Pavilion. Hop no. 3, a bay filly out of Lemon Drop, was the first horse in the ring to start the sales.

Resolutions of all kinds are common whenever the calendar flips to a new year.

If the Thoroughbred marketplace had a collective goal for 2011, it could be to have last season's flashes of stability become this year's norm.

The first indication of the industry's resolve might come when the Keeneland January Horses of All Ages sale begins it five-day run Monday.

While overall declines were still prevalent within the Thoroughbred auction arena throughout 2010, there were signs that the past three years of correction were beginning to level off.

Last season's Keeneland November breeding stock sale — of which the January exercise is generally considered an extension — saw its cumulative gross fall off by 7.7 percent, but that was still an improvement over the 13.9 percent hit suffered in 2009.

The polarization in the market isn't likely to dissipate much as buyers hindered by a lack of credit are still being conservative with their money.

As was evident by the November sale of eight seven-figure horses, however, buyers have shown they are willing to invest in the industry, especially when presented with desirable offerings.

"I think the good horses will shore up and be strong, and we'll start seeing that rise," said Frank Taylor of Taylor Made Sales. "But I still think these bottom-end horses, there is no place for them. There are quite a few horses that are getting cleaned out of the system still, but there are a few nice horses, too, and the good stuff will sell well.

"If our demand can stay somewhere close to where it's been, the supply is definitely going down, and that will start paying dividends."

Considering broodmares are a longer-term investment, they have become a particularly tough commodity to sell in the current marketplace. With a majority of sellers unable to turn a profit in the sales arena, many breeders don't have the financial luxury of being able to wait years to see whether their mares' foals produce a return.

That might not bode well for the mares, but it has resulted in a stronger market for horses closer to getting to the racetrack. Weanlings in general sold well in November, and the demand for newly turned yearlings should continue.

"I thought the weanling market in November was extremely strong, and I think the 'short' yearlings will probably be very strong again here," said Canadian breeder Yvonne Schwabe, who was among those who braved the snow Saturday morning to walk barns. "We came last November to buy a couple babies and maybe one mare, and we ended up not buying any babies and bought three mares, which we're thrilled about. I have a feeling this will be more of the same. The babies were just very tough to buy."

A total of 1,827 horses are cataloged for the January sale, including Grade I winners Negligee, Wickedly Perfect and Ave.

One area of optimism is that the market might start seeing benefits of the lower stud fees, which became widespread two years ago.

Because the mares going through the ring were bred when many stallion fees were reduced, there is a better opportunity for sellers to make money again.

"The production costs last year were just horrendous for everybody," said Geoffrey Russell, Keeneland's director of sales. "But this is unique. This is the time to get into the horse business, this is the time to breed to these quality horses that are available at reasonable prices. It is a window of opportunity, and I think it's the right time to get involved in our game."

Related stories from Lexington Herald Leader

  Comments