While Major League Baseball attempted to clamp down on international bonuses by creating bonus pools for foreign players in the current Collective Bargaining Agreement, international spending is on the rise.
During 2011, the final full calendar year when teams were able to spend without restrictions, clubs spent an estimated $87 million on international amateur players.
Beginning on July 2, 2012, all teams were limited to $2.9 million bonus pools (teams can exceed their pools but are subject to a harsh tax on the overage and limits to their maximum bonuses for the following signing period). That did seem to help the commissioner’s office curtail rising international spending, as teams dropped an estimated $84 million on international amateurs during the 2012 calendar year.
Yet in 2013, the first full calendar of bonus pools, aggregate spending on the international market jumped to an estimated $97 million, a 15 percent increase from 2012. These figures exclude the signings of Cuban players and Asian foreign professionals, as well as Mexican League transfers.
2010: $73 million
2011: $87 million
2012: $84 million
2013: $97 million
When the 2013-14 international signing period opened on July 2 last year, MLB shifted from the uniform $2.9 million pools for every team to one where bonus pool money was tiered based on reverse order of major league winning percentage the previous season. Teams were also allowed to trade pool money for the first time.
See also: International Spending by Team
Money for players at the top escalated once the current signing period began. In 2012, there were 10 players who signed from July 2 on who received a bonus of at least $1 million. In 2013, 18 players signed for at least $1 million on or after July 2, with the $2.8 million bonus for Dominican outfielder Eloy Jimenez (Cubs) far surpassing the $1.75 million the Mets gave Dominican shortstop Amed Rosario in 2012, the top bonus from July 2 on that year.
The Cubs and Rangers both exceeded their bonus pools during the current signing period, with each club spending more than $8 million on international amateur players during the 2013 calendar year. The Dodgers, who under their previous ownership group spent less than $200,000 on international amateurs in 2011, spent around $4.5 million in 2013.
Aside from the Cubs and Rangers going well beyond their allotted pool space this year, one of the reasons for the spending bump was the number of teams that have typically been among the team’s most frugal international organizations increasing their investments. While the Royals, Blue Jays and Mariners have cut back in the bonus pool era after previously being among the top spenders, the White Sox, Diamondbacks, Nationals, Marlins, Rockies and Brewers are among the other teams who substantially increased their international investments in 2013 compared to the pool-free 2011. While the bonus pools may have stifled international spending in their first year and slowed the rate of spending growth, more teams than ever are raising their commitment to the international market.
In 2014, international spending could stick around 2013 levels. The CBA eliminates $9 million that teams can spend on international amateurs beginning on July 2 this year through the removal of the six signings of $50,000 each team current has exempt from its bonus pools. The Cubs and Rangers also won’t be able to give a bonus in excess of $250,000 for the 2014-15 signing period, unless they find a way around the rules.
However, the international consensus since the end of last year has been that the Yankees will soar past their bonus pool, with estimates of the Yankees budgeting anywhere from $10 million to $20 million for international amateur players during the coming signing period.