The world-famous horseracing industry of Dubai came to the salvation of a crisis-hit family in Uruguay, all thanks to Dubai’s ruler Sheikh Mohammed bin Rashid Al Maktoum, also an avid sponsor, owner and rider of horses.
When the economic crisis in Uruguay brought bad news to Pio Olascoaga Amaya’s family farm, he took one of his horses from Uruguay to Spain and try his luck at an endurance race. Despite losing the race, a trainer working for Sheikh Mohammed approached Olascoaga and bought his horse.
That race opened new avenues for the Uruguayan young man who went on to strike close business ties with Dubai. Now, 10 years later at the age of 31, he looks after a family business with 600 Uruguayan-reared horses with Arabian blood.
“If I sell a horse in Uruguay for let’s say $20,000 on average, here you can sell at a minimum $40,000,” he said while adding that the $10,000 airfare for a horse from Uruguay to Dubai, more than 17 hours away, is worth paying due to a handsome profit margin.
Olascoaga was in Dubai to attend an Arabian horse fair in Dubai. He was extremely happy with the demand of his horses in the Gulf, in general, and the UAE, in particular.
“Here in the UAE is the Formula One of horses. They need horses all the time, and from all around the world,” he said after meeting a delegation of Saudi horse enthusiasts.
Amid the oil-fuelled economic boom, the wealthy populace is pursuing its beloved interest – horses – which has also become a big business. Arabia’s Bedouin tribes have a long traditional passion for horses and hold it very close to their heart.
Dubai, the region’s tourist hub, is emerging as the centre of the horse business in the region. This year’s Dubai World Cup, a prestigious horse race of international profile launched in 1996, managed to attract 65,000 spectators.
“This is something very important for Dubai, for tourism,” said Saeed H. Al Tayer, chairman of Meydan Group, which operates the grandiose racecourse where the World Cup is held. He also disclosed future plans of expanding the capacity to 120,000 from present 85,000 spectators.
Emiratis affectionately refer to Arabian horses as ‘drinkers of the wind’ and hold famous ‘endurance’ races during the cooler months between October and March. The riders enter the 80-240 kilometres long contest with their horses. Dozens of vehicles also accompany them to supply water.
According to the data compiled by the Federation Equestre Internationale, the UAE is home to some 2,000 active endurance horses and 87 racing stables. This comes in stark contrast to France’s 800 horses, a country where long-distance riding is also popular and has a human population about eight times that of the Emirates.
Dubai’s annual World Cup, held in March, is the world’s richest race with a $10 million purse. According to the International Federation of Horseracing Authorities, the average flat race in the UAE during 2010 offered $130,000 of prize money, the highest level in the world.
The UAE is embracing more Western equestrian trends. One recent show jumping competition held in the country offered 260,000 dirhams ($70,800) of prize money. Horse breeders are well aware of the fact that their show jumping horses bought for as little as $5,000 in Eastern Europe can fetch prices of $80,000 in the UAE, provided they perform well.
Last month, Dubai’s Sheikh Mohammed, who is also the UAE’s vice president and prime minister, was the biggest buyer in an auction of two-year-old thoroughbreds at Tattersalls of Britain, Europe’s largest auctioneer.
He bought a colt sired by 2004 European Champion Shamardal for $844,000, the third highest price ever seen at the sale. The colt had been sold for roughly a tenth of that price as a foal.
“We are used in the Emirates to picking the best horses in the world,” Dubai’s deputy ruler Sheikh Hamdan bin Rashid al-Maktoum told the Dubai Racing television channel. He owns some 1,000 horses around the globe.
But the Emirati elite is also supporting the development of home-grown businesses within the country. Horse races and beauty contests are popular across the Gulf region and several studs in the UAE breed pure Arabian horses for the competitions.
“It is a very good business,” said Khalid Ghanem al-Omairi, general manager of the Ajman Stud, which belongs to the crown prince of Ajman, another of the UAE’s seven emirates.
Al Omairi also added that they breed about 35 mares every year but out of these they get only three or four good ones. He has a stud of around 80 horses, some kept in the United States and Germany.
Godolphin is the Maktoum family’s private horseracing stable. It has made $14.8 million in prize money so far this year, bringing the total to $232 million since 1992.
Olascoaga, the Uruguayan horse breeder and agent, plans to open a stable of his own in the UAE with a local partner next year, that will be home to 20 endurance horses.
Economics vs Passion
Delving into the economics of the horse business in the Gulf is tricky indeed. Gulf countries, in contrast to their European counterparts, have a desert terrain which means that the roughly 7,000 horses in the UAE and several thousand others in neighbouring states have little chance to graze. As a result, the costs of owning these horses is pushed up as some breeders import hay from as far away as Canada along with feed, tack and other products.
According to farrier Alexandre Chuette, hooves grow faster in the UAE due to its hot climate. He says a farrier has to change horseshoes every five weeks, one or two weeks earlier compared to Europe.
While grooms are paid as little as $330 per month in the UAE, monthly stable, feed and grooming costs typically range from $650 to $1,090 or more, compared to around $450-$970 in Britain, industry sources said. According to Martina Boor, managing partner at Horseworld tack shop, total annual costs of keeping a competition horse can reach $30,000.
However, affluent citizens of the UAE are not getting discouraged by the rising costs and still hold dearly their traditional passion for horses and horseracing.
“I think that in the future, horseracing in Dubai and in the United Arab Emirates will increase,” Dubai crown prince Sheikh Hamdan bin Mohammed al-Maktoum told Reuters after handing out trophies at a recent endurance race.
“We have a lot of owners who are trying to buy horses now, and we can see even more locals trying to train.”