MR. STUTZ: Good afternoon. My name is Ward Stutz. I'm the director of membership and public policy for the American Quarter Horse Association. We appreciate the opportunity to provide testimony about the horse industry and our concerns regarding the international trade of horses.

Briefly, I'd like to touch on the economic impact of the horse industry and some demographic figures for the American quarter horse -- American quarter horses in international countries. The horse industry is a -- in the U.S. directly produces goods and of 25.3 billion dollars and has a total impact of 112.1 billion dollars on the U.S. Gross Domestic Product. There are more than 66,000 American quarter horses ininternational countries, and that does not include Canada.

In 199 -- last year, international American quarter horse new foal registrations totaled slightly over 4,500, and transfers of ownership totaled nearly 7,000. This is an all-breed statistic: Last year the United States exported over 22,000 horses valued at 200,000 -- I'm sorry. 200 million dollars.

The international market for horses is very strong. International equine events are becoming more popular in the United States. With the introduction of reigning as an approved event for the United States equestrian team and hopefully an international event, we look to these competitions to increase in the United States. This is a result of WTO's philosophies. Hopefully we will soon see a cowboy hat in the Olympic games.

The horse industry strongly supports the scientific-based decision-making concept that underscores WTO's requirements. Any movement away from this concept will have a detrimental impact on U.S. animal agriculture, particularly the horse industry. Specific issues involving the international movement of horses and horse products, including quarantines, imports and exports, regulations, etc., are being addressed very capably by the U.S. horse industry and the USDA.

Regarding export regulations of equine genetics and live horses, we have a couple of concerns. First, horse exports are being hindered because international countries are placing a quarantine on the entire state as a result of a disease outbreak that is very regionalized; for example, vesicular stomatitis, where horses in northern Texas were not able to be exported because of positive tests for vesicular stomatitis in southern Texas. The horse industry believes the concept of regionalization should continue to be pursued as set out in the Uruguay Round, and we entirely support USDA's approach. Second is the issue of cooled and frozen shipped semen. This technology offers a huge opportunity for both U.S. and foreign breeders; however, each country has their own regulations for cooled and frozen semen. Cool semen must be inseminated within 72 hours, and in most cases it's logistically impossible, under current regulations, to get a mare inseminated in that time. Frozen – many international countries also require that the semen be collected and processed at approved export stations; again, making this process logistically difficult. The horse industry recommends that we work to decrease regulations on cooled semen transportation.

Finally, we hope international opportunities for the horse industry can continue to grow, and we look forward to working with you to enhance trade opportunities. Thank you for allowing us the opportunity to testify today.

MR. GALVIN: Thanks, Ward. Appreciate it. I think this is the first time in our hearings we've heard from the Quarter Horse Association, so I guess we must be in Texas.

MR. STUTZ: We are headquartered in Amarillo.

MR. GALVIN: With regard to trade and semen, is there any effort that you know of internationally to try to develop an international standard? Or is there something specific that we can do to encourage that, like under the Codex or something?

MR. STUTZ: I think any time we get together and communicate to try to standardize those procedures would be very helpful to our industry.

Amy Mann of the American Horse Council, she works really -- she works strong in that effort. But any time we can improve that process, we'd certainly be willing to work towards that standardization.

MS. BOMER-LAURITSON: I just have a quick question, and Tim might even know the answer to this. But when you're talking about when they're quarantined on a regional versus a state basis, what is the practice now of AFAS? Do they recognize a regional area or are they quarantining on a state basis, do you know?

MR. STUTZ: Well, as far as I know, for example, in Albuquerque, when those horses were positively tested for vesicular stomatitis, they did set up a regional quarantine.

MR. GALVIN: Okay. And as you point out, I think there certainly is support in the U.S. for taking that -- for supporting regionalization. But what it always boils down to is the need to do a risk assessment, and that takes money. And every agency is constrained in terms of how much money it can spend on risk assessments, and there's different priorities in terms of potential payoffs in the marketplace and that sort of thing. But you've really got to have that risk assessment done so that you can show, you know, where to draw that line between north and south Texas, for example, so that you can demonstrate to whoever you're exporting to that you've got a process in place for controlling the problem. And that's always the riddle, getting that risk assessment done and then getting it recognized by the country that you're exporting to.

MR. STUTZ: Thank you very much.