North American market stabilises in 2012

The 2012 auction season largely fulfilled hopes the thoroughbred marketplace had stabilized in North America.

But it wasn’t easy in the wake of the recession.  Sellers still struggled in a highly selective marketplace, even as buyers complained they were overpaying for higher-quality bloodstock.

As the North American foal crop has shrunk and supply has diminished, buyers focused even more keenly on getting the best quality.  That has forced commercial breeders to do the same.

The most obvious example of two market truths – that there’s still ready money around the globe for thoroughbreds, but it tends to concentrate on a few select lots ? came when Havre de Grace set a broodmare- record of $10 million at Fasig-Tipton’s November Sale.

Havre de Grace was the first reigning Horse of the Year to sell publicly since Lady’s Secret brought $5.40 million in 1987.  She was the third-most expensive mare ever sold at auction behind $14 million Better Than Honour (2008) and $10.50 million Playful Act (2007).

For commercial breeders, yearling sales provided optimism.  But even as the yearling market saw steady or improved averages and medians, and as many stud fees held steady or fell, many breeders still struggled to earn profits at yearling sales.

Keeneland’s September yearling sale told the tale.  The average and median were up 14% and 50% but only a quarter of the yearlings sold well enough to be profitable for their producers.

Fasig-Tipton’s Saratoga selected sale bucked the general upward trend after enduring wild swings.  Saratoga consignors confronted a notable shift in Sheikh Mohammed’s buying habits when he slashed spending to 8 yearlings compared to 13 in 2011.

The Darley principal also did not vet yearlings pre-sale this year – a policy change that confused sellers who use vetting to gauge buyer interest and set reserves.  Opening-night figures plummeted, but the second session roared back into positive territory as buyers were emboldened by Sheikh Maktoum’s less aggressive spending.

Regional results appeared largely healthy.  The Barretts and Ocala auction houses saw stronger upper-market spending and Fasig-Tipton’s New York-bred Saratoga Sale was fuelled by Aqueduct’s gaming revenues.

The appeal of poker machine-added prizemoney and incentives saw buoyant upper-market spending and double-digit gains across the board.  Those results prompted Fasig-Tipton to add another New York sale to the calendar in 2013.

However, those gains were off-set when Ontario’s lucrative poker-machine program at racetracks came under threat in 2012.  Yearling averages fell by 21% and Canadian breeders are worried values will fall further in 2013.

Sheikh Hamdan’s Shadwell Estates led yearling buyers by expenditures with 20 yearlings costing $9.75 million.  Among them was the year’s most-expensive, a $1.65 million Distorted Humor colt out of Mushka.

The 2012 yearling auction season also marked the end of an era as pensioned A.P. Indy’s final yearlings passed through the auction ring.  The Lane’s End stallion was 2012’s leading yearling sire by average price, with 9 horses averaging $466,111.

The 2YO Select Sales also generally performed well.  Fasig-Tipton’s Florida 2YO Sale rang up a 35% gain in average and the Ocala April 2YO Sale followed with across-the-board records.

Barretts 2YO May Sale also saw double-digit gains in average and median while Keeneland’s April 2YO Sale was less bullish but steady.

Distorted Humor was the juvenile auction season’s leading sire with five two year-olds averaging $397,000.  The leading consignor by sales was Ciaran Dunne’s Wavertree Stables which grossed more than $13.20 million from 98 juveniles.  One of them was 2012’s highest-priced juvenile, the $1.30 million Big Brown colt bought by Coolmore Stud at Fasig-Tipton Florida.

Sheikh Mohammed may have been relatively quiet at 2012’s select yearling sales, but just four purchases – all at Fasig-Tipton Florida – made him the juvenile season’s leading buyer overall with $3.67 million.