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A Tighter Rein

By wmadministrator

Kentucky’s Bluegrass region is known for the vast number of horse farms that populate its rolling hills. Though primarily recognized as Thoroughbred country, the area also has a number of smaller and mid-sized stables that cater to the show ring rather than the racetrack. These outfits board horses, give lessons and train horses and riders to compete in a multitude of regional shows.

The stables are part of a weave that creates the larger fabric of “Horse Capital of the World.” Many are run by people who have built their lives around horses and can’t imagine doing anything else. But tough economic times have some owners a little worried as the price of hay and diesel, two staples of a running any kind of horse operation, continue to jump. Inflation is not the only culprit. Fewer acres of hay are being planted across the Southeast as farmers switch to the more profitable crops of soybeans, wheat and corn, which is tripling in price due to its use in ethanol production. Last year’s drought also has impacted the price of hay.

“Hay is not something owners can cut back on,” said Gene Clabes, the equine director of KEEP (Kentucky Equine Education Program). “You have to feed horses hay, and though you can shop around, you can’t cut corners.”

Rocketing hay prices have been compounded by the high cost of diesel, which hits both the growers, who have to cut, bale and haul the hay, and the stables, which often use diesel trucks to haul trailers, carry equipment and maintain their farms. In the past year diesel has risen from an average of $2.90 a gallon to $4.50, while average prices for hay are $100 a ton higher than last year, according to the USDA.

The result has been some farms and stables having to raise their rates for boarding, lessons and training. This is tough for stable owners, who realize that they are running more of a pleasure business than a necessity business, said Marianne Murphy, who with her husband has run Robert Murphy Stable on Parkers Mill Road near Lexington since 1977. Though one of the more established stables in the area – Robert Murphy Stable keeps about 40 horses, half of them boarders, and offers lessons and training – they are feeling the pinch.

“We are trying hard to keep things reasonable,” she said. “It’s tough. Everything costs more – diesel, hay, grain and even fencing. And paychecks aren’t rising. Knock on wood, though, our lessons (business) has stayed pretty strong.”

This summer, Murphy said, they hosted a show in July, worrying in the months leading up to it that no one would come because of rising fuel costs. She said she was surprised and relieved when the show attracted good attendance, including many people from out of state. Still, she said, she knows that many of their students are staying closer to home when it comes to horse shows.
Whereas it used to be they would think nothing of traveling to shows in Indianapolis, she said, the fuel-cost issue is now keeping many of them closer to home or making them more selective in the shows they choose. In fact, said Clabes, many horse show associations are reporting lower attendance at events.

Frank Penn has owned and run Pennbrook Farm in north Fayette County since 1968. He boards Thoroughbreds for others and operates a small sales business to help support his 43-stall operation. Fuel and fertilizer price spikes hurt. “It makes your management choices pretty tight,” Penn said.

Meanwhile, “there are more horses than buyers” at present, he said, and racing purses in Kentucky are a half to a third of those in nearby West Virginia and Pennsylvania.

Penn said conditions make it tough for many operations. “It’s like salmon swimming upstream. Most don’t make it.”

At DeLima Stables in Harrodsburg, which is about half the size of Robert Murphy Stables, things are tough, and owner Mary Delima is trying to come up with strategies to adjust, including offering more programs geared toward adults and hosting more local shows at her 41-acre farm. She said she has seen lessons decline by one-third, and many of her students from Lexington are now car pooling to get to the farm, which is about 35 minutes from the city.

“We’re losing money as the cost of hay goes through the roof; a bag of grain that was $8 last year is now $12,” she said. “And I’m afraid of going up on lesson prices out of fear of not being affordable. Everybody is being affected by the rising prices of gas and groceries.”

Delima said she is hoping the economy will turn around soon and she won’t have to part with any of her beloved school horses or get another job to supplement what she does now.

“I could never give this up,” she said. “It’s a family business.”

Sean Reilly, who owns the mid-sized Punchestown Stables in Lexington with his wife, Sarah, said the current financial challenges have forced him to think more like a businessman. For example, said Reilly, they own three diesel trucks and have become much more judicious in their use. Rather than dragging their paddocks every four weeks, they now drag them every six weeks. They make sure they are careful not to waste any hay or bedding, because straw also has become expensive and difficult to obtain. As someone who once trained for Saudi Arabia’s royal family, it’s a hard adjustment.

“Sarah and I have been centered around horses all our lives; they’ve always been our focus. We both have extensive backgrounds training, riding and working with them,” he said. “Now we are mired in the everyday minutiae of running a business.

“This is hard for horse people,” he said. “We’ve always been rewarded for understanding horses. I’m confident with horses – I can bet on any decision I make with a horse. But now I’ve got to be a pin-stripe-wearing guy, and I’m not that comfortable.”

Fortunately, Reilly said, they run a diversified operation that includes boarding, training, and buying, leasing and selling horses. They are not solely dependent on lessons. Still, Reilly said, they are concerned but optimistic.

“We’ll get through this,” he said. “And I think in the long run we’ll be better for it. It was a little too easy doing what we did. Now we will be a lot more aware.”

Clabes said Kentucky’s farmers have had to learn that it isn’t enough to love the land and raise crops – they also have to be savvy at business.
“Now the horse industry is facing the same challenge,” he said.