Later, in the out-take scenes during the credits, we get the hint that this might have been part of a larger subplot of a farmhand job or sorts. I would still probably find it unfunny. But as it stands in the movie theaters, it's an anomaly. A later scene shows Green eating a sandwich while horses hump on the same farm. Consider another as Gord works in a cheese factory.
Broad comedy begins the scene.
It is unfunny. Nobody reacts to this - nobody. Other gags continue and make sense but are simply brutal. There's a running story of a neighbor boy who gets badly hurt every time he is around Gord. His blood splatters a crowd.