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China – Opportunity Knocks for
Thoroughbred Export

March 2014
 
China horse racing oppurtunity for south african breedersOpportunity knocks for South Africa in China and South East Asia.

It was recently reported Britain struck a lucrative trade deal with China enabling them to ship thoroughbreds freely between the two countries after an export protocol was established. It is estimated the deal could potentially earn their breeding industry a staggering £10mil or R178mil!

All this despite a report in the UK’s Daily Mirror a few days later that the British Thoroughbred Breeders had concerns that they wouldn’t be able to breed enough foals to sustain their own racing fixtures!

Although there is no formal racing, and betting is illegal, China have been very proactive in the thoroughbred industry over the past few years consistently importing large numbers of horses into mainland China predominantly from Australia.

Official racing on mainland China – closer than ever before

The insatiable fascination for the Thoroughbred in China continues to rapidly evolve as it becomes prestigious for the middle to upper class Chinese to be members of “Horse Clubs”. These clubs are popping out of the ground across the country in major provinces like Beijing, Shanghai, Wuhan, Chingdau and Chengdu who recently hosted the first ever mainland China race meeting in association with Meydan, home of the Dubai World Cup in a ground breaking event.

The commencement of official thoroughbred racing in Mainland China has been rumored for many years, with betting integrity issues being reported as the major stumbling block. But with the construction of a training complex, with the ability to convert to a fully functional race track by the HKJC in Mainland China currently under construction, it appears that official racing may be closer than ever before.

In fact, the private infrastructure and facilities already in place for thorough-bred operations is quite staggering with numerous properties with similar track configurations to that of Flemington, the home of the Melbourne Cup already well established.

Add to that the establishment of respective joint ventures between leviathan breeders Darley & Coolmore with local Chinese entities already in place, and an industry explosion appears imminent.

Imagine the enormous numbers of horses China would require to sustain a racing industry in its infancy

Additionally, the dedicated plenary session “Racing in Mainland China” set down for the Asian Racing Conference next month in Hong Kong only adds further fuel to the fire, and one can only imagine the enormous numbers of horses China would require to sustain a racing industry in its infancy, but it surely runs into the tens of thousands?

There is no doubt that as the momentum gains in China, every thoroughbred breeding industry in the world will be clambering to gain a foothold to trade, but with the Chinese ability to replicate, you’d expect they will quickly establish there own breeding industry, rapidly eroding imports. That said, there would appear to be a limited window of opportunity to work within.

So where does that leave South Africa?
Well apart from the obvious current exports issues, one would think the South Africa bred horse would be ideally suited to the Chinese market. Not only as a tough and resilient breed, but also extremely attractive commercially with the Rand compared to the RMB as opposed to sterling pounds or Australian dollars? With foal crops on a steady decline globally, there would appear to be the potential for a massive shortfall of supply for not only the new Chinese markets, but also global markets that will need to be filled. Enter South Africa, the elevator is on the ground floor. As I’ve already alluded to, South Africa ticks all the boxes except one, the export protocol issues.

Hopefully, the workshop set down this week in Joburg and the opportunity to lobby at the Asian Racing Conference can firmly put the subject front and centre, create robust debate and culminate in some tangible results for the industry resulting in significant economic impact for the country. Either way, it would appear to be the perfect time to mount an official trade mission and aggressively lobby the likes of China and beyond with a working party of industry leaders complimented by government delegates.

Asian relationships need to be cultivated

Asian relationships need to be cultivated and as a direct result, will work both ways resulting in Chinese ultimately investing in South Africa, as they have in other countries with enormous economic rewards. Now’s the time to work closely with them to establish joint ventures, co – operatives, industry training and breeding ventures while their industry is in its relevant infancy and receptive.

There has never been a better time for South Africa to establish and cement these relationships and impart the vast knowledge, expertise and training of South Africa’s horsemen and women to a foreign market. “Carpe Diem” South Africa!

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