Answer: The navel is dipped immediately after birth to prevent bacteria from entering the foal. The umbilicus can have a direct communication to the blood system of the foal.  If bacteria enter the foal's blood stream it could cause neonatal septicemia (bacterial blood infection) and the foal could have serious health consequences.

Most commonly the umbilicus is dipped with a dilute chorhexidine (blue in color) or dilute iodine (brown in color) solution.