Emphasis on Conformation, Foreign Buyers, Boost Book 3

The marathon Keeneland September yearling sale did not lose any momentum by taking a day off Sept. 14, with the following sessions on Saturday and Sunday continuing the upward tick shown during the “open” sessions of the auction.

Saturday, when the first horses cataloged in book 3 went through the ring, the average rose 12.2% and the figure was up 8.1% Sunday. Gross receipts also rose each day when compared with the same sessions one year ago. While that is a positive sign for any sale, more significantly, the median price rose 25% Saturday and was up 11.1% Sunday.

That there is so much strength at this point in the marathon sale indicates the double-digit declines in gross and average during the first two select sessions of the sale were anomalies of the market as a whole. Obviously, the select session yearlings command prices that are primarily based on the strength of pedigree as much, if not more, than the yearlings’ conformation traits.

"Today is book 3, and we talked to our consignors about wanting a catalog that stressed strong conformation," Geoffrey Russell, Keeneland’s director of sales, said following the Sept. 15 session. "The buyers respected that, and the market reflects it."

According to Russell, the open part of the sale reflects pre-sale forecasts that foreign buyers would have a greater presence this year than in years past at the September sale. Some of that has to do with an overall weakness at other yearling sales so far this, presenting buying opportunities to some who otherwise have not participated in the fall yearling scene. The other major reason is the strength of foreign currencies against the U.S. dollar.

Those foreign buyers, combined with solid participation from domestic buyers who have confidence buying untested yearlings at the price ranges found in the middle days of the sale, propelled the results for both days of book 3.

For example, during Sunday’s session, there were 17 horses selling in the $200,000-$249,999 range, compared with four during the same session one year ago. Conversely, there were 49 yearlings sold for prices ranging from $50,000-$74,999 Sunday, compared with 64 in 2006.

That and similar price shifts upward over the two days helped push the book 3 average up 9.8% to $108,618 this year. The median price of $90,000 represented a Book 3 gain of 20% and the gross for the two days rose 4.5%.

Although the gross and average are down 8.2% and 5.8%, respectively, much of that is due to six yearlings selling for prices in excess of $4 million last year during the select sessions, compared with none at that level this year.

It is worth repeating that the domestic yearling market is weakest at the very top, with strength at those levels just under the top and in the middle.

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