In 2003/4 I built over a mile of wooden fence, three rail, with a friend of mine and my wife and kids.
I looked a a number of different options before I decided to go with all wood.
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Electric Fencing for Horses - Premier1Supplies
Cost became the overriding factor. There had been a few hurricanes through this area and all the local Amish saw mills had incredible deals on 1x6x16 oak boards. As mentioned by CKelly, go with pressure treated posts as described.
Good luck. My fences still look good although they will need additional work and stain next spring.