Published September, 2013

Kentucky’s equine industry had a total economic impact of almost $3 billion and generated 40,665 jobs last year, according to the 2012 Kentucky Equine Survey. The equine industry's tax contribution to Kentucky was approximately $134 million.

According to project lead Jill Stowe, PhD, an associate professor in agricultural economics and University of Kentucky Ag Equine Programs director, the total economic impact is measured by the output effect and is an estimate of revenues earned by the sale of goods and services related to the equine industry and its interconnected industries. The study also showed that the value-added effect, which is perhaps a more descriptive measure of economic impact because it accounts for costs of production, has an estimated economic impact of $1.4 billion. The value-added effect is a measure of profitability and new income paid to workers rather than simply revenue.

On Sept. 6, the UK College of Agriculture, Food and Environment’s Ag Equine Programs and Kentucky Horse Council, in conjunction with the U.S. Department of Agriculture National Agricultural Statistics Service, released the economic impact figures from the 2012 Kentucky Equine Survey, a comprehensive statewide survey of all breeds of horses, ponies, donkeys, and mules. This was the first such wide-ranging study of Kentucky’s equine industry since 1977 and the first-ever detailed economic impact study about Kentucky’s equine industry.

“We are pleased to announce the long-awaited results from the economic impact study," said Stowe. "The estimates underscore the continued significance of the equine industry to the commonwealth, and they show that each segment of the industry contributes in important ways to the economy as well as to the rich cultural fabric of Kentucky."

When looking more specifically at each sector’s estimated impact, breeding had the highest employment figure of 16,198, an output of $710 million and a value-added impact of $333 million. Racing had the highest output impact at $1.28 billion, with an employment figure of 6,251 and $601 million in value-added impact. Competition figures included 2,708 in employment, $635 million in output, and $297 million in value-added impact. Recreation had 594 in employment, $166 million in output, and $78 million in value-added impact. Other, which accounts for operations such as therapeutic riding facilities and those where horses are used for work, had an employment figure of 14,914, a $194 million output, and a $91 million value-added impact.

“The College of Agriculture, Food and Environment is proud of this project because first and foremost, it represents the best available methods of surveying that universities and government can provide," said Nancy Cox, associate dean for research in UK’s College of Agriculture, Food and Environment, Kentucky Agricultural Experiment Station director, and administrative leader for UK Ag Equine Programs. "But the most compelling aspect of this study is that our future policy discussions can be guided by solid numbers. We thank the Kentucky Horse Council and the Kentucky Agricultural Development Board, as well as our numerous donors, for recognizing how much the Horse Capital of the World needs a sound foundation for policy decisions.”

The first phase of the study was released in January and measured Kentucky’s equine and asset inventory. That portion of the study found that the state is home to 242,400 horses and estimated the total value of Kentucky’s equine and equine-related assets at $23.4 billion. The survey’s results identified 35,000 equine operations and 1.1 million acres devoted to equine use.

Also from the inventory portion of the study, the total of all equine-related sales and income for equine operations was about $1.1 billion. That total came from sales of all equines, estimated to be $521.1 million, and $491 million in income from both breeding and non-breeding services, such as training, lessons, boarding, farrier, transportation, purses, and incentives.

The first phase also found that equine-related expenditures by equine operations totaled about $1.2 billion. Capital expenditures by equine operations, including the purchase of horses, real estate, and improvements and equipment, were estimated to be $337 million. Operating expenditures, including expenses paid for boarding, feed, bedding, veterinary, supplies, farrier services, breeding, maintenance and repair, insurance premiums, utilities and fuel, taxes, rent and/or lease, fees and payments, shipping and travel, training and other fees, totaled $839 million. Notably, 77% of these operating expenses were spent in Kentucky.

The study determined that 56% of Kentucky’s equine operations are farms or ranches, 30% are for personal use, 3% are boarding, training, or riding facilities, and 2% are breeding operations.

The vast majority of horses inventoried were light horses (216,300), followed by donkeys and mules (14,000), ponies (7,000), and draft horses (5,100). Thoroughbreds are the most numerous breed in the state (54,000), followed by Quarter Horses (42,000), Tennessee Walking Horses (36,000), American Saddlebreds (14,000), donkeys and mules (14,000), Mountain Horse breeds (12,500), Standardbreds (9,500), Miniature Horses (7,000), ponies (7,000), Paint Horses (6,500), and Arabian and Half-Arabian horses (5,500).

The primary use of the majority of Kentucky’s equines is for trail riding/pleasure (79,500); followed by broodmares (38,000); idle/not working horses (33,000); competition/show (24,500); young horses, including yearlings, weanlings, and foals (23,000); racing (15,000); work/transportation (12,500); breeding stallions (3,900); and other activities (13,000).

"The data from this study will benefit the state in many ways," said Anna Zinkhon, Kentucky Horse Council Board president. "We have already made use of the results at two regional horsemen’s caucuses held in areas with identified concentrations of equine populations. We are looking forward to at least three additional regional horsemen’s caucuses based on this data in 2014."

As might be expected, there is a concentration of horses in the Bluegrass area of Central Kentucky but there are also other areas of the state with significant equine concentrations.

According to the report, the top 10 counties in Kentucky with equine acres were Fayette (89,000), Bourbon (48,700), Woodford (44,200), Scott (26,600), Grant (22,000), Oldham (21,000), Grayson (18,900), Warren (18,700), Boone (16,500), and Carter (16,400). More detailed county information can be found in the full report online.

“The University of Kentucky has equine expertise in many scientific disciplines," said Norman K. Luba, executive director of the North American Equine Ranching Information Council. "The economic survey is an example of expertise that transcends over, not only the science of horses, but the business of horses in the commonwealth. Documented and dependable economic data will provide critical information about the significant role the horse industry plays in the economic well-being of Kentucky’s economy.”

Funding for the project was provided by the Kentucky Agricultural Development Fund, along with UK’s College of Agriculture, Food and Environment, the Kentucky Horse Council, and numerous other industry organizations and individuals, a complete listing of which can be found on the project’s website. More information about the 2012 Kentucky Equine Survey, including a copy of the final report and appendices, can be found at www2.ca.uky.edu/equine/kyequinesurvey.

Holly Wiemers, MA, is communications director for UK Ag Equine Programs