US president Donald Trump’s trade tariffs have already sent shockwaves throughout stock markets globally. In London, the FTSE 100 plunged by six per cent on Monday morning to its lowest level since February 2024, while Bloomberg calculations suggest that around $9.5 trillion has been wiped off share prices worldwide.
It may be some time until those shockwaves reach the bloodstock industry, so for now the question remains how big the impact will be and where it will be most keenly felt.
In thoroughbred terms, Britain and the EU have extremely close ties with the US. The likes of Coolmore, Godolphin and Juddmonte have operations on both sides of the Atlantic and trade between the various nations is commonplace.
The volume of equine traffic is highlighted by data from the Weatherbys Fact Book. In the last four years, 1,629 horses bred in Britain and Ireland have been permanently exported to the US. Only France and Italy have received more in the same period.
However, Trump’s controversial tariffs have all the hallmarks of a significant blight on trade. A ten per cent tax is set to be added to all imports into the US from Britain, while those from within the EU will face an even more punitive charge of 20 per cent.
European auctions are a major marketplace for US buyersCredit: SARAH FARNSWORTH
In the last four years Britain and Ireland have also imported 1,493 US-breds. How this dynamic will be affected remains to be seen as EU leaders are still considering their response, although some retaliatory tariffs are expected. British prime minister Sir Keir Starmer remains hopeful of securing a better deal with the US.
While there is a lucrative private market, particularly for proven horses, the impact of these tariffs is set to be much more visible at the sales, where international investment has proved an increasingly vital factor.
Last year’s record-breaking Tattersalls October Yearling Sale provides a clear illustration of the point as over 70 lots were purchased by US-based buyers. In his end-of-sale statement, Tattersalls chairman Edmond Mahony went so far as to highlight the “large contingent of American buyers making a massive contribution” to the Book 1 market.
Of course, not all will have been purchased with export in mind, but a roll call featuring US Grade 1 winners Aunt Pearl, Digital Age, Domestic Spending, McKulick and Newspaperofrecord highlights that American connections are ready, willing and able to target British- and Irish-bred stock for their home nation’s expanding turf programme.
By way of example, Mike Ryan bid 250,000gns to secure Program Trading at Book 1 in 2021. Trump’s tariffs would see an additional 25,000gns (roughly $33,400 at current rates) being added to the owner’s bill if the same sum was spent this year.
The difference is even more pronounced for countries within the EU. Preakness Stakes winner War Of Will was purchased at the Arqana Breeze-Up Sale in Deauville for €250,000 by agent Justin Casse. Under Trump’s policy, that figure would see €50,000 (approximately $55,000) added to the price.
Purchases for the US by agents such as Justin Casse (pictured) could regularly be subject to tariffsCredit: Laura Green
While these increases may give owners pause for thought, owning racehorses remains a rich man’s game. Would tariffs of ten or 20 per cent be enough to dissuade US buyers from shopping on the other side of The pond? Perhaps not, particularly if that is where best products are found.
But what might see the wealthy stopped in their tracks is significant fluctuations in exchange rates or billions being wiped off the stock market – events that have already occurred in light of Trump’s widely condemned tariffs.
And it is this wider economic unrest that is likely to have a more profound impact on the bloodstock market, rather than the specifics around the cost of individual horses.
The bloodstock market so often shows resilience when faced with a challenge. But if Trump presses ahead with his tariff policy, a position he doubled down on over the weekend, it would be naive to think our industry won’t feel the effects – whether that’s directly or indirectly. Every market relies on confidence, and with talk of trade wars and recessions dominating headlines, that is presently in short supply.
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