Canadian breeders face significant challenges as new U.S. tariffs threaten to upend long-established industry practices. The 25% tariff on goods entering the United States, set to take effect April 2, will dramatically impact horse sales and breeding operations across the border.
Canadian-bred yearlings sold at U.S. auctions will require purchasers to pay an additional 25% on top of the hammer price — effectively pricing Canadian breeders out of crucial American markets.
Dave Anderson, operator of Anderson Farms in St. Thomas, Ontario, detailed these concerns as the Gainesway Guest of the Week on the TDN Writers’ Room podcast presented by Keeneland.
“It’s going to cost people a lot of money,” Anderson said. “As you know, I have my own farm in Canada. With the infrastructure and all, I have lots of money invested, as do others. Having to send them somewhere else is going cost me a lot of money. We’re hoping that something will happen on April 2 and cooler heads will prevail and this will all go away and everything will be merry again.”
Anderson isn’t taking chances with his operation. He’s already relocated most of his horses to the U.S. ahead of the deadline, despite the significant financial burden of finding boarding arrangements.
“When a horse is sold, whether it’s transferred privately or publicly at auction, they’re going to be subject to a tariff if they’re not in the United States by April 2,” he explained. “Otherwise, those horses selling at Saratoga or at Keeneland September, they’re all subject to a 25% tariff. I can tell you personally, with my own horses, they’re all on their way to Kentucky. I’m not going to risk a 25% tariff on my entire yearling crop. But this will just cripple my operation. All my profit is gone.”
Many Canadian breeders are making similar arrangements, while others are “running the gauntlet” according to Anderson.
The tariffs could significantly impact breeding stock sales as well. Last November, Canadian-based Moira (Ghostzapper) sold for $4.3 million at Fasig-Tipton November. Under the new tariff structure, her buyer would have faced an additional $1.075 million in fees.
Valuation issues present another layer of complexity. While auction prices establish clear values, privately sold or unraced horses crossing the border create assessment challenges.
“Sadly, I think with our industry we’re really just collateral damage for bigger issues, steel, aluminum, oil, gas, all the big ones,” Anderson noted. “And how do you value a horse? Just because the horse is by Into Mischief doesn’t mean it doesn’t have OCDs in the stifles and is standing on three legs and it’s worth 500 bucks. It’s going to be a bit of a Kreskin routine at the border.”
Anderson expressed dismay at the sudden division between U.S. and Canadian racing interests.
“Canadians, Americans, to me, it’s no different,” he said. “I don’t differentiate. This industry, the horse business, we’re all in it because we’re passionate. We don’t do this because it’s a great business model. It’s because we love the animal and that’s why we’re in it. And if we can make a little money along the way, then terrific. But there have never been political or economic boundaries like this before.”
In the podcast’s “Fastest Horse of the Week” segment, sponsored by WinStar, the team discussed breeding to WinStar stallion Independence Hall. Booth (Mitole) earned the weekly honor with a 107 performance when winning the GIII Whitmore S.
The podcast — also sponsored by the Pennsylvania Horse Breeders’ Association, West Point Thoroughbreds, the KTOB, 1/ST Racing and 1/ST TV — featured Randy Moss, Zoe Cadman and Bill Finley reviewing encouraging equine fatality rate statistics recently released by The Jockey Club and HISA.
The team also previewed upcoming major stakes including the GII Louisiana Derby and the GIII Jeff Ruby S., while discussing Hall of Fame trainer Wayne Lukas’s Derby prospect American Promise (Justify), who dominated the Virginia Derby by 7 3/4 lengths.
