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Horse's coat thinning out

My 20 year old came in from night turnout in the pasture about two weeks ago with a scabby, bald patch on his shoulder. Nothing like rain rot, but seemed more like irritation from bugs or maybe getting into a weird plant or weeds. I started rubbing “Hay where’s that blue stuff” on it and the bumps disappeared and his hair slowly started coming back.

However, yesterday I noticed when grooming him he’s shedding out like crazy and now has super thin spots of hair on that whole side of his body, more pronounced on his flanks and barrel. The other side looks normal, though he is shedding badly everywhere.

Planning on giving him a Banixx medicated bath later today when it warms up, but just wondering if anyone had any ideas of the cause. Our weather is starting to drop into the 40’s at night, so I know he’s preparing to grow his winter coat but I’ve never seen him lose hair like this in the 10+ years I’ve had him. Ideas?