Coping with the Crisis

September 2006

By Timothy Capps




When Equiery readers were queried about how higher energy prices were affecting them, the responses were both swift and interesting.

As might be expected, the greatest immediate concern is with the surge in gasoline and diesel fuel prices, and virtually every respondent mentioned that as an inhibiting
factor in their equine activities.

Overwhelmingly, people are curtailing anything that requires significant transportation expenditures, which means cutting back on showing or attendance at clinics or les-
sons. Several riding operations mentioned that their business was off significantly because of higher gas prices, with customers spacing out their lessons or simply dropping out altogether for the time being. Some of those who have competed actively in the past said they had essentially stopped doing so for now, choosing to spend their money on farm operations instead and citing rising veterinary, farrier, mowing and other costs as a result of the higher gas prices.

Virtually all of the boarding operations said that they had raised prices somewhat to help offset the higher energy costs, with a couple of respondents noting that their elec-
tric bills had almost doubled already. In addition, many reported taking conservation measures like the following:

- Using solar powered fence charges and/or looking into use of solar roof panels
- Using timers on lights and fans
- Keeping all outside lights off except in emergencies
- Changing barn hours to avoid non-daylight activities
- Cutting off fans and lights when horses are outside, also eliminating any non-essential appliances
- Keeping horse operations at the same level, but closing up the house, keeping lights off and turning up the thermostat
- Eliminating HBO and cutting back on take-out food in order to maintain horse activities
- Starting to use bio-diesel as a cheaper, cleaner burning alternative to gas or regular diesel fuel
- Buying a small car for regular transportation while keeping the pick-up parked unless absolutely necessary

The thrust of the responses is that horse people are looking for different ways to change their energy-burning habits. Those who offer products or services are also having to adjust their prices upward to reflect the higher energy costs, and are nervous about doing so because higher gas prices have already driven customers away. At the same time, many said they have made sacrifices in personal consumption in order to maintain their horse care standards, and have found that their reductions in travel to shows or other events has given them a new appreciation of their horses and having them in their backyard.

Taken together, these responses indicate an economy that is slowing down – perhaps heading into a recession – due primarily to higher gas and utility costs. Unfortunately, there is little that elected officials and regulators can do to fix things or even ease the pain.

It is a time of uncertainty, much like the mid- and late ‘70s, when a sluggish economy and persistently higher prices (triggered by oil price shocks resulting from Middle East armed conflicts) led to double-digit inflation and double-digit interest rates.

It wasn’t pleasant then, and it isn’t likely to be now. The good news is that we got through that period, learned some lessons, and emerged better and stronger.

The better news is that your horses don’t even know it’s happening.

–Timothy Capps

 

 

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