Ansc 440:  Horse Management
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Lecture 1:  Industry Trends
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Description:
	The population of horses in the U.S. has fluctuated due to economic situations and the role changing of horses from uses in agriculture enterprises and transportation to primarily recreation.  Because only about half of all horses are registered, their is no certain way to determine actual horse numbers.  As with all "goods and services", the cost of horses is governed by supply and demand.  There are many factors, such as the human population in a state and the earning potential of horses in various activities that determine the distribution of horses throughout the U.S.  Furthermore, the horse industry has considerable economic significance in annual investments, foreign exports, and race-track wagers.  And finally because the horse industry is primarily a recreation activity, it must compete with other "recreation" sports for people's interest.  Marketing of the industry should focus on those "typical" owners who only own horses for a relatively short period of time and have little background knowledge of horses. 

Lecture Outline:
	I.  Population trends
		A.  U.S. population
		B.  Reasons for fluctuations
		C.  Other countries
	II.  Actual horse numbers?
	III.  Cost/prices of horses
		A.  What drives prices of horses?
		B.  Keenland example
	IV.  Role and distribution
		A.  % recreation
		B.  Factors affecting U.S. distribution
		C.  State distribution
	V.  Economic significance of horse industry
	VI.  Recreation competition and marketing in industry
		A.  Sport competition
		B.  Owner profile

Objectives:

1.  Describe the role-changing of horses in the U.S. from past to present (i.e. what were horses used for in the past and what is their primary role today)

2.  Explain why there is no one particular method to obtain the actual horse population and list ways to estimate the population

3.  List the factors that affect the horse distribution in the U.S.

I.  Population Trends

	A.  U.S. population
		1.  1915 -1920 :  increase in population of horses (22 million)
		2.  1960's :  population drops (2 million)
		3.  1986 :  5-6 million horses = comeback
	B.  Reasons for fluctuations?
		1.  beasts of burden/transportation in early 1900's
		2.  drop in '60's 
			a.  leisure time low
			b.  economy low
			c.  little discretionary income
	C.  Other countries
		1.  in different stages of the economy
		2.  used for transportation

II.  Actual horse #'s?

	A.  Example :  hog #'s = # of hogs to slaughter
	B.  Count foals registered; only 55% of horses are registered
	C.  Count # of transfers of owners
	D.  Count $ spent by owner's to take care of their horses (because don't know for sure 											actual #'s)
	E.  Count number of farms in counties (probably only represents 1/3 of total #'s)
	==>thier is no certain way to count actual horses numbers

III.  Cost/Prices of horses

	A.  What drives prices of horses?
		1.  supply and demand
		2.  example of Keenland sale (thoroughbreds)
Date			# of foals			Keenland sale avg
1980			36,000				$196,000
1983			47,000				$501,000
1986			51,000				$537,000
1990			47,000				$352,000  (48% of $ came from foreign 												sales)
			a.  prices fell, then drop in # of foals produced
			b.  why increase then drop?
				=>70's inflation








Diagram:
















IV.  Role and distribution of horses in U.S.

	A.  85% of total #'s of horses are kept for recreation
	B.  Factors affecting horse distribution in U.S
		1.  leisure time
		2.  economy = amount of discretionary income
		3.  human population
		4.  use:  earning potential
			a.  pari-mutual horse racing
				(incentive programs for racing horses in certain states)
			b.  dude ranches
		5.  federal and state laws
	C.  State distribution (handout)
		1.  Most horses in U.S. are located in areas of high human population
		2.  States that surround IN are in top 10 why?
			a.  human population
			b.  horses in those states can make more money

V.  Economic significance of horse industry

	A.  Horses contribute in excess of $15 billion annually to the economy; 16% of GNP of 			Agriculture, Forestry and Fisheries section of U.S. economy
	B.  $13 billion in annual investment and maintenance expenditures
	C.  $$ in foreign exports
	D.  Race track attendance and wagers = $ in state tax revenue = jobs in industry






VI.  Recreation competition and marketing horse industry

	A.  If 85% of horses are for recreation, what is horse industry competing against?
		1.  other recreation sports (boating, skiing, ...)
		2.  if horse industry is to increase, need to get people interested in wanting them
	B.  Owner Profile
		1.  average person owns app. 2 horses (2.6)
		2.  people usually get horses around 8-9 years old
		3.  usually get rid of horse when go to college (18 yrs old); have owned horses for 				< 7 years
		4.  therefore own horses for 5-6 yrs
		5.  overall people don't really have a lot of experience or background in raising 				horses; thus need to market those who have little knowledge