On November 6, US Ambassador to China Terry Branstad and Chinese Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) Minister Zhi Shuping finalized an agreement with China to allow the import of American horses. Several US organizations were involved in the move to re-establish exports to China, including the United States Department of Agriculture’s Animal and Plant Health Inspection Service (APHIS), the Kentucky Thoroughbred Owners and Breeders (KTOB), the American Quarter Horse Association (AQHA), Keeneland Association, and US Livestock Genetics Export. Currently, Chinese investors purchase between $20-30 million worth of horses each year and the new agreement is expected to have an immediate multimillion-dollar impact.
The largest exporters of thoroughbred horses to China are Australia, New Zealand, and Ireland. However, experts believe racing conditions in mainland China are similar to those in North America, providing investors with a greater incentive to purchase American horses. American horses were banned in 2015 due to concerns over outbreaks of equine infectious anemia, a fatal blood borne virus.
Horse racing is a $25 billion industry in the United States but betting on horse races is illegal in China and has been since 1945. As a result most Chinese horse racing takes place in rural communities near the Mongolian border. Only about 60 small horse races take place in mainland China each year. For comparison, the two tracks maintained by the Hong Kong Jockey Club jointly run 740 annual races. But Chinese investors pour money into the sport, investing in thoroughbred horses and broodmares to run stables that aspire to produce world-class horses.
And no one turns out thoroughbreds like Kentucky, easily the United States’ largest horse exporter. Two out of every three horses sold by the United States is from Kentucky. Kentucky exports nearly $200 million worth of horses annually. According to the Kentucky Department of Agriculture, last year the State sold 71 horses to Japan, 295 horses to South Korea, and 9 to Thailand. Should the ban on betting horse races end, China would become the most important export in the world overnight.
Jake Howry is a Georgetown University Graduate Student and Intern at the East-West Center in Washington