Keeneland September Sale Starts Monday

[Wandering Eyes]

LEXINGTON, KY – The Keeneland September Yearling Sale, traditionally considered a bellwether auction for the industry, opens its 13-day run Monday with the first of three select Book 1 sessions beginning at noon.
The 2018 September sale was one for the record books, with an all-time high average and the fourth-highest gross in auction history. The gross of $377,140,400 was up over $69 million from the 2017 auction and the sale featured 27 seven-figure transactions.
“I would say guardedly optimistic,” Keeneland’s Vice President of Racing and Sales Bob Elliston said of expectations for the 2019 September sale. “I’m optimistic because I see the quality of the stock that breeders and consignors have brought to the grounds-it’s just extraordinary. And I see the number of folks who are the grounds inspecting the horses, people from literally every continent on the planet. All the right folks are in attendance and are giving us great feedback about the quality of the offerings.”
Elliston admitted 2018’s lofty figures would be hard to surpass.
“The guarded part is that we’re up against the huge number we put up last year, when we were up $70 million from the prior year. To get back to that bar would be positive in my opinion, so a flat year would be a great year. That’s what gives me just a little bit of guarded thoughts.”
The September sale will be the fourth major yearling sale of the season, following on Fasig-Tipton July and Saratoga sales. Consignors, who were kept busy during a brisk day of showing Sunday morning, were expecting to see a continuation of familiar market trends.
“I don’t see any reason for things to change too much,” said Gainesway’s Brian Graves. “All the same people are here. The market is good. I know the yearlings sales were down a little in gross leading up to this, but I think that is more a function of just the numbers that were sold. There were fewer horses sold in Saratoga this year, so I think the change in gross is mainly because of that. The traffic [at the barn] has been encouraging. I don’t see any big changes one way or the other, I think it will be the same.”
With continued demand at the top of the market, Four Star Sales’ Kerry Cauthen said there will always be buyers for the right product.
“Last year was an exceptional sale,” Cauthen said. “As a consignor, my view is always fairly myopic-it’s what is right in front of me, which is of course my consignment. I think my traffic has been excellent and I think I have a very good group of horses overall and with all the right folks in tow. And the old adage my father said, ‘If you give them a good horse, it’s going to sell really well.’ I think I’d be overly zealous to hope for better than last year, but I think we’re going to have a nice sale.”
With the sales barns awash with activity Sunday, Carl McEntee of Ballysax Bloodstock is expecting another strong September.
“The market will be good this year,” McEntee said. “All of the right players have arrived in town. So that will help the market through Book 3 and I think if you have the right horse, in the right book, I think you’ll do very well.”
One standout feature of the 2018 September sale was the strong demand which started in Book 1 and continued straight through to the end of the sale.
“When you have all the buyers globally coming into the sale, that trickle down forces everybody back a book or so, which I think is fantastic for the economy and it’s fantastic for the industry,” McEntee said.
McEntee said there were plenty of European shoppers at the sales grounds ahead of Monday’s first September session, despite uncertainties in the international economy led by the looming “no-deal’ Brexit at the end of October.
“The only thing I was questioning was the value of the pound right now, but there seem to be more Europeans here then there were last year,” McEntee said. “Usually when the pound is a little stronger, obviously they are buying 70 cents on the dollar, so that does help the market a little bit. But there seems to be a large contingent of the Europeans buyers and internationally, we have an awful lot of people in. I think Brexit has been an issue for five years and I still don’t know what they are going to do. From a standpoint of a no-deal Brexit supposed to be happening Oct. 31, it will be interesting to see what happens, but I think the economy on a national level here in the U.S. will stay strong through next year. We’ve seen some fluctuation in the stock market, but I think at the very top end of the market, that doesn’t really affect too many of the players.”
Cauthen agreed global uncertainties would play a part in how the September sale unfolds, but he expects a weakness in one area will be counteracted from another segment of the buying bench.
“It’s Brexit. It’s the value of their currency right now. That will play a factor, but what happens in all markets is that when you have one action, you have an equal reaction in another area,” Cauthen said. “Hopefully we get some Americans and some strong other parts of the world buyers to come in and fill any void. You have certain overseas buyers that a weaker currency or a Brexit doesn’t change the way that they are going to do business. They see that as a blip on the screen and they are going to continue on. I think you’d be foolish to think it won’t have some effect, but I don’t think it’s going to stop them from buying the right horses.”
Keeneland has been tinkering with the format of the September sale for the last several years. In 2018, Book 1 was held over four sessions and included close to 1,000 horses. Book 1 has been shortened to three sessions this year, with 569 catalogued yearlings.
“It was completely in response to what our buyers asked from us,” Elliston said of the change. “With 989 horses as part of Book 1 last year, the price you have to pay to get a horse like that requires you to spend some quality time doing your due diligence on them and the buyers said they simply didn’t have the time to see that many horses. So by spreading it out more and having a more manageable number, that gives them the time to do their homework and feel confident when they have to pay that kind of money for a Book 1 horse. And we’re getting good, positive feedback from them on what they are experiencing on the grounds.”
Cauthen said he was pleased with the shorter Book 1, which gave buyers the chance to spend more time looking at consignors’ best product.
“I think this is a good format,” Cauthen said. “I think the buyers are more relaxed this time. There always has to be a balance between slow and fast, and buyers will probably get a little bored towards Tuesday and Wednesday because they’re going to be ready to get on to the next book. But we want them to focus on what is in front of them and we want them to see our A+++ grouping. We want them to be very focused on them. And I think they will be. So far, I’ve heard very positive buyer feedback.”
Major buyers such as Larry Best and Peter Brant were conspicuous at the sales grounds Sunday morning, and many consignors were likely buoyed by the anticipated arrival of another major player. Sheikh Mohammed’s Godolphin was the leading buyer at the 2018 auction, purchasing 27 yearlings for $19,960,000. The sheikh made his first in-person visit to the sale in nearly a decade in 2018 and returned to Lexington Saturday evening.
“We have a tremendous buying bench, but it’s always an honor to have Sheikh Mohammed here,” Elliston said. “He is an extraordinary gentleman who has put so much into this industry worldwide and when he takes time from his very busy schedule to be with us, it is a tremendous honor for all of us at Keeneland to have him with us.”
The three Book 1 sessions of the September sale will begin at noon. Following a dark day Thursday, the auction resumes Friday and continues through Sept. 22 with sessions beginning daily at 10 a.m.

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