Australia's billion dollar racing and breeding industry is in turmoil as authorities battle to contain an outbreak of equine influenza (EI) that has shut down racing and horse movement around the country.

The cost of the shutdown is already in the tens of millions of dollars with the cancellation of race meetings in all states, with the Northern Territory the only place to hold racing on Saturday.

The spring carnivals in Sydney and Melbourne could be in doubt if racing does not resume within a few days and next year's foal crop will be severely diminished with some of the world's most valuable stallions in lockdown at Sydney's Eastern Creek quarantine station and Spotswood in Melbourne.

Federal Agriculture Minister Peter McGauran ordered a 72-hour Australia-wide ban on all thoroughbred and harness racing following the EI scare, which surfaced at Eastern Creek on Thursday.

The shutdown is in accordance with protocols and guidelines set out in the Ausvet Plan.

The first case of EI in Australia was detected in a stallion that had travelled from the northern hemisphere.

Late on Friday, NSW authorities were alerted to a suspected outbreak in recreational horses stabled at Sydney's Centennial Park and tests confirmed the horses were infected.

A five kilometre exclusion zone was extended to 10 kilometres around Centennial Park, which is close to Randwick Racecourse where about 700 racehorses are trained.

Racing NSW chief executive Peter V'Landys said he hoped the measures put in place would minimise the damage.

"The national thoroughbred plan has been put in place," Mr V'Landys said.

"We are in the hands of the NSW government and the federal government and they have acted comprehensively and swiftly.

"This is devastating for the industry and the loss of today's Randwick meeting is a loss of $9 million in NSW TAB turnover alone," Mr V'Landys said.

"NSW accounts for around 40 per cent of TAB turnover and if you include bookmakers and interstate TABs it runs into tens of millions of dollars on Randwick alone.

"If this goes on for a month, in NSW alone the cost will be a billion dollars."

A five-day control order also has been put in place in NSW which prevents the gathering of equine animals at markets, fairs, sales, shows, parades, race meetings and other gatherings involving such animals or products.

NSW Primary Industries Minister Ian Macdonald confirmed five horses at Eastern Creek have tested positive for EI, 11 at Centennial Park and another six horses are showing signs of the virus.

The disease is not fatal but affects horses much the same as influenza does humans and an infected thoroughbred would take somewhere between one and two months to recover.

Arrowfield studmaster John Messara, president of the Thoroughbred Breeders Association, said he supported the actions taken on Saturday.

"This is critical, with the spring carnival upon us," Mr Messara said.

"The government is taking a zero tolerance approach to this, and I think we have got to support them on that, because if this was to spread through the horse population it is very, very contagious and it would bring racing to its knees.

"As breeders, first of all there are 43 stallions caught in quarantine stations and that will affect breeders with bookings to those stallions, at least in the first 30 days.

"Our stallion Snitzel is locked in quarantine with the others.

"Importantly, now, in addition to that that if the current 72-hour ban on horse transport is extended then you won't be able to move mares and walk mares into stallions in NSW."

Many of the country's leading spring carnival contenders were due to race on Saturday including star mare Miss Finland at Adelaide's Cheltenham course and top sprinter Gold Edition at Moonee Valley.

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