U.S. Sales in 2021 to be Impacted by Korean Racing Ban

The Korea Racing Authority had already implemented what is essentially a ban on importing foreign-bred horses a month before United States racetrack executive Belinda Stronach urged North American sales companies, owners, and breeders to stop selling horses to Korea because of concerns they might end up in a slaughterhouse.

KRA announced in November a temporary restriction on all foreign-bred horses purchased after Nov. 15 that prohibits them from being registered to race at Korean racetracks in 2021. All horses must be registered to be eligible to race. The KRA moved the registration deadline for imported foreign-bred horses born in 2019 from Dec. 31, 2021, to March 31, 2022.

Several factors led to the KRA one-year restriction, according to Seona Ha, an associate with the KRA's international relations team, who relayed to BloodHorse information provided by the KRA's Race Planning Team.

"KRA has tried to walk in line with the Korean government's quarantine policies by minimizing overseas traveling related to purchasing of foreign-bred horses," said Ha. "Owners have suffered a reduction of purchasing power due to the reduced number of races and prize money that resulted from the COVID-19 outbreak and strict social distancing rules."

Because of the pandemic, the total number of races in Korea is down 56% this year and purses are down 26%.

"Demand for racehorses has dropped dramatically due to the uncertainty over racing next year," Ha continued. "The expected return of buying and owning a horse has been significantly reduced under the KRA Emergency Racing System."

The Emergency Racing System calls for racing schedules to be released on a quarterly basis next year. For the first quarter, the number of races will be down 38% compared with the beginning of 2020 and purses will be down 60%.

Along with the lower demand for racehorses is a need for owners with the ability to buy horses to acquire them from Korean breeders instead of markets overseas.

"The Korean breeding industry is in a state of near-collapse, as the non-racing period continued longer than expected, and was in desperate need of protective measures," Ha said.

Because the new restriction applies only to racehorses, it will not affect the sale or importing of broodmares or stallions. The restriction will be felt most keenly at next year's North American 2-year-olds in training sales.

According to The Jockey Club, from 2010 through 2019, there were 3,706 Thoroughbreds exported from the U.S. to South Korea. The number of exports has risen appreciably in recent years as Korean import restrictions were eased. According to KRA records, 1,108 broodmares, racehorses, and stallions were imported from the U.S. during 2017-19, or 30% of the total exported since 2010.

Many of the exported horses were bought at public auction. Sales records maintained by BloodHorse show that since 2017, Korean agents K.O.I.D, S.R.O.A, and KRA purchased 557 horses of all types for a total of $19,833,900, or an average of $35,608. Specifically at 2-year-olds in training sales, Korean buyers bought 113 juveniles during 2019-20 for a total of $5,044,000.

"It's always disappointing when trade restrictions are imposed, particularly with the success U.S.-bred horses have enjoyed in Korea and the long standing relationships that have been developed," said Boyd Browning Jr., president of Fasig-Tipton, which conducts three 2-year-olds in training sales and July horses of racing age sale. "We will work with the appropriate parties to hopefully have the ban only in place for one year and resume free trade as quickly as possible. The United States' Thoroughbred industry needs buyers from around the world so we can demonstrate the outstanding quality of horses bred in America."

Tom Ventura, president of Ocala Breeders' Sales Co., which also conducts three 2-year-olds in training sales and sells horses of racing age, expressed disappointment as well about the new restriction.

"At the end of the day, Korean buyers have been successful with the horses they've bought, and they have been active in a part of the market that can on occasion be soft," he said. "Korean racing has improved."

Evidence of that success can be seen in how much Korean buyers are now willing to spend on racing prospects. A decade ago, the KRA restricted how many horses could be imported and how much buyers could spend on each horse. In 2010, the first year K.O.ID. appeared as a buyer at U.S. 2-year-olds sales, it bought 37 juveniles for an average of $19,919. Of these 37 horses, 19 were purchased for $20,000. Over time, the number of exports allowed and the amount buyers could spend were increased. Korean buyers acquired six, six-figure horses in 2019-20, including an Outwork  colt named Knicks Front that the KRA bought for $190,000 at this year's OBS March 2-Year-Olds in Training Sale.

Stronach's call Dec. 16 for a ban on Thoroughbred sales to Korea is based on aftercare and welfare concerns raised by the activist group People for the Ethical Treatment of Animals.

"The Stronach Group is urging all North American auction companies, breeders, and owners to develop policies that prohibit the sale of Thoroughbred racehorses or broodmares to South Korea without the meaningful and binding assurances that these noble animals will be protected after their racing and breeding careers," said Stronach, who is president and chair of the racing conglomerate that owns Santa Anita Park, Gulfstream Park, Pimlico Race Course, Laurel Park, and Golden Gate Fields. She took this position after reportedly seeing a PETA video exposé about the slaughter of Thoroughbred racehorses and breeding stock in South Korea.

PETA's investigation reportedly went behind the scenes at the largest slaughterhouse in South Korea, owned by the national corporation Nonghyup. Three workers and Nonghyup itself were found guilty and fined for violating South Korea's Animal Protection Act in January 2020. As a result of its findings, PETA has asked the KRA to introduce a retirement system modeled on the Thoroughbred Aftercare Alliance, allocate 2% of prize money to aftercare, end its support for horse slaughter, and ensure that imported North American horses will not be slaughtered.

Ha told BloodHorse that the KRA has long supported multiple aftercare and welfare initiatives. These include:

• Operating a Retired Racehorse Management Program that provides funding for professional institutions to re-train retired racehorses so they can transition to a second career. The funding for this program comes partially from prize money and partially from KRA donations,
• Operating an Equine Welfare Committee that regularly publishes welfare guidelines distributed to trainers and owners,
• Hosting a "Best Retired Thoroughbred" competition to expedite the career transition of retired racehorses. The competition and prizes are intended to provide more opportunities for retired racehorses to be better utilized as equestrian horses,
• Promoted the amending of qualifications at equestrian events so more retired racehorses can participate,
• Developing a registry system to keep track of retired horses in addition to those registered for racing or breeding, and
• Actively participating in the International Forum for the Aftercare of Racehorses by hosting international seminars with overseas equine welfare specialists in an effort to improve equine welfare in Korea.

"No horse is imported to Korea for slaughter purposes," Ha relayed from the KRA's Retired Racehorse Aftercare Team. "While slaughter is legal in Korea and is carried out in regulated facilities, the Animal Protection Act covers the mistreatment of horses during that process. Those involved in the previously highlighted cases of mistreatment have been legally punished earlier this year.

"Notwithstanding the above, the ownership of horses and the right to dispose them belong to owners and are not subject to external intervention," Ha said. "Horses owned by the KRA are strictly managed under welfare guidelines. Retired KRA stallions have their welfare assured for the rest of their natural lives and are commemorated after death for their contributions."