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Fasig-Tipton July sale down, but not out

NO-ONE expected a blockbuster sale to transpire at Fasig-Tipton this week, and the low expectations were justified during the two-day Kentucky July Sale, the first major US yearling auction of the season. But it could have been worse.

Most insiders were pegging the expected losses at 30per cent, roughly the percentage by which US breeze-up sales fell this spring. So when the sale ended on Wednesday with a 26 per cent drop in aggregate - from 13 per cent fewer horses offered - and declines of 16 per cent in average and 27 per cent in median, there was a definite sense of relief, despite a clearance rate of 64 per cent (including private sales).

The sense was all the more heartfelt because Tuesday's opening session nearly fulfilled the worst fears, with the median plunging by one-third compared to a year earlier and the average falling by 24 per cent.  Last year's auction had already been nibbled at by the effects of the sub-prime mortgage crisis, so it was just a matter of how much further the yearling market was going to fall this year.

We still don't know that figure, but this was a good first indication. However, I would not throw out the 30 per cent expectation yet; after all, the US breeze-up market was down by that amount, and so was the JRHA foal sale in Hokkaido this month - Japan's version of the select summer sale.

Pinhookers were clearly cautious in Kentucky this week, while trainers did not show up in the numbers Fasig-Tipton had been hoping for, after making a big recruiting push for them, especially for handlers from the West Coast.  Timing may have been a factor - nearly every trainer in southern California was busy shipping his or her string to Del Mar for the meeting's opening day on Wednesday- but with racing days and quite possibly racetracks being cut from the big picture, trainers' orders were bound to be down.

We do have an answer to the underlying questions of the week, though: Are there still buyers for racehorse prospects, and can professional traders still make money at their game? The answer to both questions is yes, although it should be qualified; not as many, and not as much.

Despite Fasig-Tipton's disappointment with the trainers, breeze-up pinhookers may have shied off the most. Many of the pinhooking mainstays curtailed their spending sharply compared to 12 months ago. Bowling & Dodd, Eisaman Equine, Hartley-DeRenzo and Gulf Coast Farm were completely absent from the buyers' sheet, having bought a total of 12 horses among them last year, while Crupi's New Castle Farm cut back from eight purchases last July to two, and Leprechaun Racing from 13 to two.

What about the foal-to-yearling pinhookers? This was their first test of the season, a chance to see whether foals bought at the nadir of last year's bloodstock market, when Keeneland's November sale figures fell by 40 per cent or more, could make money in the prevailing climate. As it turns out, they can, if noteasily.

There were 65 yearlings offered who had been purchased at auction previously (not including lots who were bought back in their last trip through the ring). A full 44 of them were sold, for a clearance rate of 68 per cent - four percentage points better than the overall clearance rate. Of these, 31, or 70.5 per cent, were profitable, including keep costs of $10,000 and five per cent sales commission.

The purchase average for thepinhooks was $53,023, while the new sale average was more than double that at $107,409, with an average profit after notional costs of $39,016.

Common wisdom had it that the established sires were bringing the real money this week, but in fact the top sire by average with two or more lots sold was a stallion with first two-year-olds - Rock Hard Ten - followed by a sire with first yearlings - Bernardini. New sires Henny Hughes and Rockport Harbor also made the top ten.

The three leading first-crop sires were all Darley stallions - in order, Bernardini, Henny Hughes, and Rockport Harbor. Rockport Harbor, who covered 146 mares in 2007 and has 118 live foals reported to the Jockey Club registry, fielded one of the largest drafts of yearlings, which achieved an average of $115,000. Only half of his 14 lots were sold, but they included five who made $100,000 or more.

Four of Henny Hughes's seven, from a book of 139 and a crop of 99, were sold for an average of $123,750. But both of those stallions were trumped in breeding shed numbers by Vinery sire Congrats, who covered 172 mares for 107 live foals.

With a fourth-ranked average of $93,000 for four of six lots sold, Congrats is oneof three freshman sires among the top ten by A.P. Indy; the others are top-ranked Bernardini (two of two sold for an average of $250,000) and tenth-ranked A.P. Warrior (three of three, $70,000). Additionally, seventh-ranked Silver Train, another prolificsire, with 129 live foals and ten lots sold from 16 offered, is a grandson of A.P. Indy by the Californian runner Old Trieste.  It remains to be seen how these "grandchildren" of A.P. Indy run, but his is clearly a strong sire trend.




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