Some feed comes compact, and expand with moisture, like beet pulp. It is vital to soak these feeds before the horse consumes it, otherwise, it can and will expand in their throat and stomach. This causes choke and colic.
To help my older horse chew his feed, to reduce dust, to help reduce the risk of choke (one of mine used to bolt his feed, he doesn't any more), lots of reasons.
One reason is because my horse won’t eat it if I don’t wet it down with some water, he likes it mushy, and I put powder probiotic in his feed so I have wet it and mix it in. But I also wet it down because when it’s dry it would be a easy choking hazard, when wet down a bit it loosens up the grain and makes it easier to chew, and swallow.
So they don't breathe in the dust from the feed
My horses get chaff in there feed which is very dry so i add water to there feed so its not to dry for them
I often mix water into my horse's feed because he does not drink enough water on his on so if I know he has had a hard workout or has a show or travel coming up it is an easy way to help me keep him hydrated and performing at his best.
Preventing the feed to get stuck on the way down to the stomach. It’s also a good way to get your horse more water if the horse is dehydrated.
To make the feed more moist, it it most common to do that for older horses so they can chew it easier.
Sometimes you need water to activate pellets and stuff, I had a horse that had trouble putting on weight and we mixed water with his pellets to thicken it up
If there feed is dry, water can help make it more soup and there's a less chance they can choke on dry practices