Voluntary Report - public distribution

**Date:** 6/8/2005

**GAIN Report Number:** IS5001

IS5001

**Israel**

**Product Brief**

**Race Horses**

**2005**

**Approved by:**

![](media/image1.wmf)Asif J. Chaudhry

U.S. Embassy, Cairo

**Prepared by:**

Gilad Shachar

**Report Highlights:**

Recently the social economic cabinet of Israel approved a plan to allow
organized gambling on horse racing in Israel. The number of race horses
is expected to increase from 250 to 1,200 (380 percent), in addition to
the development of many supporting services. Two new hippodromes will be
constructed, and it is estimated that horseracing gambling will begin in
2006. The future presents good opportunities for U.S. suppliers.

Includes PSD Changes: No

Includes Trade Matrix: No

Unscheduled Report

Tel Aviv \[IS1\]

\[IS\]

Market Overview:

Currently, the horse racing industry in Israel is very small, however it
is expected to expand significantly in the immediate future, due to the
approved plan by the social economic cabinet to legalize gambling on
horse racing. However, the Israeli parliament (Knesset) must first
approve the legislation for gambling at racetracks.

Events will be based at specially constructed hippodromes near the
Gilboa area (northern Israel) and in the Negev region (south of the
country). Besides two planned hippodromes, the proposal is expected to
encourage entrepreneurs to invest in horse rearing infrastructure,
veterinary hospitals, riding and training schools, breeding farms and to
sustain local tourism around the two centers. According to industries
sources, horserace betting will most likely start in 2006 and annual
revenues are expected to reach \$40-45 million for each of the next five
years \$223 million within five years.

Currently, there is one race track in Israel. It is located in
Pardes-Chana (central Israel). The size of the site is 25 hectares. It
was established in 1999 by a group of foreign and local businessmen and
hosts approximately 10 contests per year.

The new hippodrome in the south of the country will open by the end of
2006. A 5,000 seats facility is planned for a 50 ha site. Israeli and
French businessmen will invest approximately \$15 million in the
hippodrome. Three races per week are expected.

There are approximately 15,000 horses of all kinds in Israel (industry
estimate), of which 6,000 are Quarters, 6,000 Arabian horses and the
rest are Appaloosa, Tennessee Walkers, Paint, Andalusian and
Thoroughbred horses. The figures are not official due to the fact that
the majority of the horse owners raise their horses at their private own
locations.

The two main horse associations in Israel are: Israeli Quarter Horse and
the Arabian Horse.

There are 1,300 Quarters horses (official data) in Israel, of which half
of them are males. Most of the Quarters were born in Israel. In
addition, there are 3,000 Arabian horses (official data).

Approximately 250 racing horses exist in Israel, of which nearly 200 (80
percent) are Thoroughbreds and the remainder is Arabian horses and
Quarters. The racehorse industry will demand approximately 1,200 horses,
which means an additional import of 1,000 racing horses.

# Import

In the last few years, approximately 90 horses were imported into Israel
annually, mainly from the European Union (EU) and the USA. Most imports
are of male horses, however demand for mares will increase in the
immediate future. Live horse imports are not limited and are tax free.

#  Graph 1: Import of Live Horses, by Heads, Year

![](media/image2.wmf)

Source: Israeli Veterinary Services

## Table 1: Imports of Live Horses, by Origin, Year, \$ Thousands

  ------------- -------------- ---------- ---------- ----------- ----------- ------------
                **Value (\$                          **% of                  
                Thousands)**                         Total                   
                                                     Import**                

  **Origin**    **2000**       **2002**   **2003**   **2000**    **2002**    **2003**

  Belgium       62             14         74         14.62       3.02        17.37

  France        10             0          5          2.36        0.00        1.17

  Germany       74             21         57         17.45       4.54        13.38

  Netherlands   144            133        24         33.96       28.73       5.63

  U.K.          0              44         18         0.00        9.50        4.23

  Hungary       10             11         0          2.36        2.38        0.00

  U.S.          118            240        244        27.83       51.84       57.28

  Others        6              0          4          1.42        0.00        0.94

  **Grand       **424**        **463**    **426**    **100.0**   **100.0**   **100.0**
  Total**                                                                    
  ------------- -------------- ---------- ---------- ----------- ----------- ------------

Source: CBS, Foreign Trade Statistics, Different Years.

# Import Regulations

An application for the importation of horses must be made not less than
60 days before planned departure of the horse to enable the completion
of required tests and attestations abroad. All imported horses shall be
quarantined in an official quarantine station for a period of eight days
or as decided by the director.

Contact details:

1.  The Director of Veterinary Services, Import-Export Officer P.O. Box
    12, Beit Dagan 50250, Israel. Fax numbers are: 972-3-9688963 or
    972-3-9605194; Tel: 972-3-9688986.

2.  The Israeli Nature & National Parks Protection Authority. Address: 3
    Am VeOlamo St. Givat Shaul Jerusalem 95463 Israel. Tel:
    972-2-5005463; Fax: 972-2-5005459.

### Local Gambling Market

In 2003, the total domestic gambling market was estimated at \$3.9
billion, of which \$0.91 billion (22 percent) was legal gambling, \$2.73
billion (70 percent) was illegal gambling and \$0.23 billion was via the
internet. Of the legal gambling total, \$667 million (73 percent) was
national lottery tickets and the remainder (\$203 million) was sports
contests.

In 2003, approximately 300,000 Israelis gambled abroad in the amount of
\$150 million.

In the last decade, the local gambling market has increased
significantly, and it is expected to further expand in the near future.
The horserace gambling market in Israel is expected to reach \$223
million annually.

###  Graph 2: The Gambling Market in Israel, \$, billion, 2003

![](media/image3.wmf)

Source: University of Derby and BDI.

###### Business Opportunities in the Israeli Market 

If the Israeli parliament approves the new plan, there will be an
expected shortage of 1,000 race horses. In addition, demand for mares
will increase, mainly for Quarters and Thoroughbreds. With the
strengthening Euro, making many European products more expensive, it is
likely that the demand for U.S. horses and products/services will
increase. The best opportunities for importing live horses, products and
services are during the next four years.

###### 

###### Table 3: Opportunities and Challenges for U.S. Exporters to Israel

  -------------------------------- --------------------------------------
  **Opportunities**                **Challenges**

  Legalized betting at horse races U.S. exporters lack knowledge of the
                                   Israeli market and are unaware of new
                                   opportunities

  Opening of two new race tracks   Israeli buyers lack familiarity with
  in 2006/7                        U.S. sources

  Lack of professional expertise   The intensive competition from the
                                   European Union, mainly Holland,
                                   Germany and U.K.

  Lack of professional             Political and security conditions in
  veterinarian and nutrition       the region are not conclusive for
  knowledge                        marketing activities that highlight
                                   U.S. products

  Strong demand for Thoroughbred   Lack of awareness of new opportunities
  horses and a shortage of 1,000   
  race horses                      

  Increasing demand for mares      

  Strong reputation of U.S. horses 

  With the euro getting stronger,  
  it is likely that the demand for 
  U.S. products may increase       
  -------------------------------- --------------------------------------

###### Key Contacts and Further Information:

Israeli Quarter Horse Association - Ruthy Shadmot - Tel: 972-52-3666455

Dr. Tamar Milo -- Tel: 972-54-4234685; E-mail:
<tamarm@netvision.net.il>;

Web Site: [www.ilqha.co.il](http://www.ilqha.co.il/)

The Israel Equestrian Feder**ation** - Tel: 972-9-8850938; Fax:
972-9-8850939;

E-mail: <office@ief.org.il>; Web Site:
[www.ief.org.il/ief](http://www.ief.org.il/ief)

Appaloosa Horse Club of Israel - Tel: 972-50-7808282; E-mail:
<il_appaloosa@yahoo.com>

Web Site: http: <http://ilappaloosa.tripod.com/index.htm>

Arab Horse Association - Yiftach Shadmi -- E-mail:
<yftach_s@walla.co.il>;

Dr. Evelin Timor -- E-mail: <evelin_t@walla.co.il>; Web Site:
[www.horse.co.il](http://www.horse.co.il/)

The Israeli Jockey Club - Web Site:
[www.ph-racingclub-israel.co.il](http://www.ph-racingclub-israel.co.il/);

E-mail: <isr-j-cl@zahav.net.il>; Fax: 972-4-8524140; Tel: 972-4-8532081

The Israel Sports Betting Board - Web site:
[www.toto.org.il](http://www.toto.org.il/)

Local Mailing address: Contact the Office of Agricultural Affairs in the
U.S. Embassy in

Tel Aviv. Tel: 972-3-5197324/7686; Fax: 972-3-5102565;

E-mail: <gilad.shachar@usda.gov>; Web Site:
<http://www.usembassy-israel.org.il/fas/>