International Signing Period News & Notes

June 25th, 2008 · 5 Comments

By Kiley McDaniel

Frankie and I have been busy gathering more information for articles, with a comprehensive 2009 draft preview, 2008 draft review, Cape Cod Reports, Florida State League reports, Trade Rumors, and MLB Analysis all on the way in the coming days and weeks. The most pressing of these topics is the International signing period, which opens on July 2nd, when clubs can sign the newly-eligible 16 year old talent from Latin America.

Much has been made of this season’s crop, mostly because of the headlining prospect, imposing righthander Michel Inoa, and his reported enormous demands. Based on the conversations I’ve had with Latin American sources, not only will Inoa easily break the bonus record ($2.44 million to Wily Mo Pena, pictured at right), he may come close to doubling it.

SaberScouting.com’s sources have indicated that the Oakland A’s are willing to go over $4 million to sign Inoa and are the heavy favorites to sign him, for a record bonus as high as $4.5 million.

The other teams in the running haven’t shown the consistent interest the A’s have, including multiple visits from Billy Beane, and most teams aren’t willing to break the $4 million barrier.

In an environment where you have to pay a competitive bonus and “recruit” the player like a high school football star, teams that are called heavy favorites late in the process almost always close the deal.

Check out some notes on the upcoming International signing period, which starts on July 2nd, after the jump…

There is more to this year’s crop than just the top talent, though this year promises to have the more Latin millionaires than any other, and that is a function both of the amount of talent and also organizations eager to find a place to spend their money.

The real storyline going forward from this July 2nd is going be clubs like Oakland and San Diego coming out of the woodwork to be major players on the international scene, as the potential return on international prospects is such now that almost every team is extremely active in Latin American now, even if with lower-bonus type prospects.

There are some interesting dynamics at play in Latin America that I’ll cover in the next few articles, but I’ll go over a quick economic breakdown of what should happen on July 2nd before we get to the scouting reports.

How Much Money Is In Play?

According to one executive, for all of 2004, only 8-9 teams spent $1 million total in Latin America, and this season, it is expected that 20-22 teams will spend a total of $1 million or more. That is a function of a great talent crop, teams having more money to spend, and infrastructure including scouting networks and academies now being in place for many teams that recently established a presence in the two hotbed countries: Venezuela and the Dominican Republic.

Small market teams are realizing that to have a chance to win they have be successful at scouting, be willing to go over slot at times in the draft, but also must be a player of some kind in Latin America. There is talk of some teams doubling their Latin budgets from roughly 30% of their total amateur budget to nearly 60% to try to take advantage of the value that can be found in these countries if done right.

As far as total money spent by all teams, roughly $50 million was spent last year in Latin America and that number is expected to jump to about $65 million this year—a 30% increase in one year.

The poster child for this increase in Latin spending is the Oakland A’s. They have already spent $350,000 on toolsy 17 year old Dominican OF Robin Rosario, signed another prospect for $100,000, have added a few lesser profile players, and are prepared to offer over $4 million to Inoa, the headliner for a July 2nd rush that could include more top talent. Oakland has already spent, before July 2nd, an amount that exceeds their last three years’ Latin bonuses combined.

How Many Millionaires?

On a per-player basis, last season there were three Latin millionaires: 3B Michael Almanzar ($1.5 million to the Red Sox), OF Kelvin DeLeon ($1.1 million to the Yankees), and SS Jharmidy DeJesus ($1.0 million to the Mariners). This year, you can expect anywhere from 5 to 10 millionaires, with many insiders suggesting 7-8 as the likely number.

An interesting dynamic to keep an eye on are inflated prices for players originally projected to get between $500,000 and $1 million. The clubs that don’t get their big money targets in the $1 million and higher category will fight each other and bid up for the second tier guys. With more teams on the international scene, that should push a number of projection-based players figured to sign in the mid-to-high six figures to become members of the millionaire club.

Inoa Getting Lots of Love

As for Michel Inoa, it’s been indicated that at least a few teams have a policy, informal or stated, not to pay a certain amount for July 2nd pitchers; such as a cutoff at $250,000, $500,000, or as high as $1 million for other teams. Inoa was called a, “philosophy changer,” by one insider and, by all accounts, there were 10-15 teams on Inoa as his price climbed from $2.0 million to $3.5 million. Now that the bidding appears to have reached $4.0 million or more, it looks like there may only be a few teams still in the running.

One thing is for sure: whichever teams ends up with the big right-hander will have a highly-coveted prize.

The Loophole Millionaire and the Defector

The above projections don’t include two notable international talents. The first is power-hitting Dominican OF Juan Duran that the Reds signed for $2.0 million in March due to a little known age loophole, as every other team assumed he wasn’t eligible to sign until this July 2nd.

While the Reds rave about Duran’s right field arm, advanced bat, and big power, one source I spoke with was much more skeptical of Duran. The executive described Duran’s hitability as average and while the power is plus, Duran’s defensive tools would only play at 1B and the bat isn’t on the same level as previous July 2nd bonus babies like Giants’ 1B Angel Villalona ($2.1 million) and Yankees’ C Jesus Montero ($1.6 million), making Duran is more of a high six-figure to low seven-figure prospect.

Recent Cuban defector Dayan Viciedo is a 19 year old impact corner bat with skills along the lines of Villalona and Angels’ Cuban defector 1B Kendry Morales. It appears Viciedo will not become a international free agent like Jose Contreras, Livan Hernadez, and many other Cubans defectors who defected to Caribbean countries have, but rather a prospect for the amateur draft, as Yunel Escobar did when he defected to America.

This appears to be the case because, instead of defecting to another Caribbean country to establish residency and become an international free agent like any July 2nd prospect, Viciedo quietly came to America in late May, making him subject to the amateur draft, but because MLB was not aware of his defection, he was not on the list of players that could be drafted in this month’s draft, which would then make him eligible for the 2009 draft. Viciedo’s agent, Jaime Torres, is trying to convince MLB that since Viciedo was processed a month before June’s 2008 draft, that he was draft-eligible this year and going undrafted would make him a free agent presently.

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Tags: International · News & Notes

5 responses so far ↓

  • 1 Doug Gray // Jun 26, 2008 at 1:50 am

    I can’t say much about Duran other than what I have heard from the Reds scout I talk to, but I do know that I like what he is doing so far in the DSL where as a 16 year old he is hitting .280/.424/.520.

    Who knows if the kid pans out (but I sure as heck hope he does), but I just hope the Reds keep spending money down there. Hearing that they are at least making attempts at Iona is promising, although I don’t expect them to sign him they have been in on talks for a few other bigger named guys including Yorman Rodriguez out of Venezuela. Should be an interesting signing period as the next few months roll around and guys become eligible.

  • 2 Jared // Jun 26, 2008 at 1:11 pm

    Great article. Really looking forward to hearing more about the top prospects.

  • 3 Scouting Reports: The Other International Prospects | SaberScouting // Jun 27, 2008 at 8:37 am

    […] an economic look at this phenomenon, check this article, and stay tuned for another article about it here in the next few […]

  • 4 kileymcd // Jun 27, 2008 at 4:39 pm

    Doug,
    I like those numbers too, but the DSL is almost a high school level of competition, wood bats, the best players being the age of HS sophomores, and some guys are junk-balling 23 year olds in the low-to-mid 80s, lots of errors and strikeouts…it’s just rough on the eyes.

    But it’s definitely a good plan to keep spending if you’re the Reds. They’re showing all the right signs.

  • 5 July 2nd Morning Update | SaberScouting // Jul 2, 2008 at 11:37 am

    […] the Latin market and bonuses, along with gathering more confirmed signings, take a look at the notes article I wrote to introduce the July 2nd signing period with some numbers and a general feel for the […]

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