Archive for auctions

Is Strength in the Auction Sector Indicative of Strength in the Racing Industry???

This week’s LET IT RIDE.COM HOT TOPIC comes from Tom Law of The Saratogian…take a read and VOICE AN OPINION!

Strong Auctions Mean Strong Industry

LEXINGTON, Ky. — The positive gains recorded earlier this month inside the Humphrey S. Finney Pavilion on the Fasig-Tipton Co. sales grounds were felt not only in Saratoga Springs, but throughout the industry that has realized more than its share of disastrous outcomes at its public auctions over the last several years.

To recap, both of Fasig-Tipton’s auctions in Saratoga posted positive results. The first bit of good news, and easily the most significant of the two bright spots, came during the two-day sale of selected yearlings on Aug. 8-9. Bolstered by the purchases of Sheikh Mohammed bin Rashid al Maktoum, the select sale record gains of 1.2% for total sales ($32.9 million), 15.9% for average price ($319,340), and 4.2% for median ($250,000).

Five days after the select sale, the New York-breds got their chance to shine. The preferred New York-bred sale posted near-record results and increases of 83% for total sales ($6,725,000), 38.7% for average price ($54,238), and 16.7% for median ($35,000).

So what exactly do the results of the Saratoga sales, combined with similarly positive returns at Fasig-Tipton’s Kentucky July yearling sale, mean?

Simply put, the overall strength of the country’s Thoroughbred auctions is often a good indicator of the industry’s strength.

To further back up that statement, look back 75 years back to be exact, and read a quote from the late and noted Turf writer Charles Brossman that appeared in the Aug. 29, 1936 issue of The Thoroughbred Record to see what positive results at Saratoga mean for the industry.

Brossman noted after an especially productive year of selling at Saratoga, when the total sales mark was greater than $1 million for the first time in history, that the “price of yearlings at the Saratoga sale is always an index to the condition of the Turf in America.”

The differences between 1936 and 2011 are certainly great, considering that 75 years ago the mammoth Keeneland September sale did not even exist, never mind hold such a prominent position that it does today. But still, the results of the first three major yearling sales of the season hold promise for better things to come or at least some more stability.

Two more important tests loom in advance of the September sale, the first opening today in Ocala with the OBS August yearling sale and then again next week when the Fasig-Tipton Texas sale is conducted at Lone Star Park in Grand Prairie. Those two auctions, much like the preferred New York-bred sale, are regional markets and offer largely middle-market-type yearlings, or horses priced in the $25,000 to $75,000 range.

They also often do not attract the nation’s larger and more prominent racing operations, something the New York-bred sale was able to do thanks almost entirely to the onset of the launch of alternative gaming at Aqueduct later this year.

The idea of slots-enhanced purses at New York Racing Association tracks brought buyers out in droves. They liked what they saw, and backed it up with plenty of bidding on August 13-14.

When all was said and done, 22 yearlings passed through the ring for prices of $100,000 or more, compared to just four a year ago.

The good times, indeed, have returned.

Now the challenge is for the good times to continue.

Stay tuned.