Horses are more sustainable, even though they eat grass, their refuse is part of a life cycle to replenish more grass and provide nutrients to their roots.
In addition to horse excriment being good for soil, tractors rely on fuel to run. Grass (or horse feed) is renewable while fossil fuels are not. In addition, building tractors require raw materials and labor, while creating new horses requires only other horses ;).
Horses are more sustainable, however I could easily argue how using tractors is more efficient, but thats another story.
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