Economic crisis tipped to end record yearling sales

The West Australian - Perth,Western Australia,Australia

10th January 2009, 8:00 WST

The Magic Millions Perth yearling sale next month is expected to end five years of record-breaking results as the world financial crisis hits the racing industry.

The economic meltdown struck a blow to this week’s Magic Millions Gold Coast yearling sale, which along with the Sydney Easter sale is the most important annual auction of juvenile horses in Australia and New Zealand.

Average prices fell 20 per cent on Thursday after a $19 million spending frenzy on Wednesday, the opening day of the Gold Coast sale.

Thursday’s top colt fetched $620,000 in contrast to the opening day when leading Sydney trainer Gai Waterhouse spent $3 million on two standout yearlings.

The day-one sale average of $153,000 fell as low as $120,000 on day two and finished at $137,650.

Proprietors, vendors, syndicators and trainers predict the economic downturn will cause last year’s average price from the first four sessions of $157,321 to fall significantly this year.

This year’s sale has 1327 horses in the catalogue – significantly lower than last year’s 1811 horses.

Average prices plunged 40 to 50 per cent at yearling sales in the northern hemisphere late last year.

The Perth sale, which begins on February 11 at Belmont Park racecourse, has just six fewer horses catalogued than last year but how much they are sold for and how many are sold has leading players nervous.

Magic Millions WA manager Murray Tillett said he was bracing for the battered economy to strike the Perth sale. “It’s fair to assume that prices will definitely be down,” he said. “They’re down roughly 30 per cent at the Gold Coast so we’re expecting about the same for Perth.”

On opening night last year, the 96 lots sold fetched an average of $51,365 to set a record for a Perth yearling sale.

An average of $50,514 per horse for the three-day sale last year also set a record. The average price has increased each year since 2004 when an average of $25,126 was reached.

Mr Tillett said he expected it would provide attractive value for buyers. “The strong Eastern States representation this year will also attract buyers from the Eastern States and a number of buyers will come from the Gold Coast sale,” he said.

Leading WA studmaster John Andrew, who runs Serpentine-based Alwyn Park Stud, said Perth yearlings were undervalued by comparison.

“Our average yearling price is around $50,000 and our Saturday race stakes money is the same amount, whereas the average price at the Gold Coast and Sydney sales is around $150,000 to $200,000 and their stakes money is about $70,000,” he said.

WA bloodstock agent John Chalmers, who was inspecting yearlings from next month’s catalogue at a number of stud parks yesterday, said the price of quality horses for auction would not fall as much as the lowerquality yearlings.

“I think you’ll find the top end of the market will be affected a little bit but the bottom end will struggle,” he said.

JAY ROONEY