Events at the biggest racehorse sale in the world, Keeneland, continue to support our views on the question of high priced service fees. All we can say in addition to what Bill Oppenheim has said in his column below, is caveat emptor (buyer beware), in the case of the broodmare owner.

The horse game’s traditional slugging match between Sheikh Mohammed’s Darley operation and John Magnier’s Coolmore have not materialised, but on the first day Darley bought five of the six top colts and yesterday it was the other way round. Last year as a result of the locking of horns between the two titans, the top price was close to USD$10 million, this time it was USD$3.7 million (Coolmore), whilst Darley’s top bid has been USD$2.9 million. The “in vogue” stallions have been A P Indy (both organisations), Unbridled’s Song (Coolmore) and Distorted Humour (Darley), while Storm Cat, as is evident from Bill Oppenheim’s remarks, has been rather unfavoured by his own lofty standards.

Extract from TDN 12.09.07
From the desk of Bill Oppenheim

Bill OppenheimBill OppenheimI’m standing by my comment that stud fees on the top horses are going to have to come down a notch. One of the important things we’ve learned is that not enough Book 1 horses are showing a profit right now. The facts are pretty bare. The gross was down $37.5 million or 20 percent from $182.8 million last year to $145,377,000. The average was off 24 percent from $564,383 to $431,386. Strikingly, though, the median remained exactly level with last year, at $300,000 (see comment about stud fees, above). But, as always, the facts require elucidation.

Two facts absolutely leap off the page. Fact number one: the sale was down $37.5 million in gross. Sheikh Mohammed’s (John Ferguson) spending was down more than $40 million. Last year they spent $57 million on 25 yearlings in Book 1. This year they bought 15, spending a little more than $16 million. So that’s one way of describing the drop in the sale’s figures.

Fact number two is that five of Coolmore’s (D.L. O’Byrne) 11 purchases were by two of the top all-American sires. They bought three colts by A.P. Indy, and two—including the saletopper—by Unbridled’s Song. This surely signals their determination to remain competitive in an American market dominated by Darley’s big-money stallion purchases this year.

Finally, the Storm Cat update. Better news here. Though six of his 17 catalogued today were outs, of the 10 which sold, five did make seven-figure prices. His overall average increased to $601,400, at least above the stud fee. But, with 33 catalogued over two days, only 60 percent of those (20) were listed sales. Of those 20, six brought $1 million or more, but none of the other 14 sold for as much as the stud fee. So you had a 30 percent chance of getting $1-million plus, and a 70 percent chance of not getting your money back. Doesn’t look that good a bet.