。
In Hokkaido, they make straw horses.
Literal
Hokkaido [at-では] straw [of-の] horse [object-を] make.
藁の馬 ('straw horse') is a traditional folk craft. 藁 ('straw') takes some kanji familiarity. では is the contrastive topical variant of で ('in/at [place]') — 'in Hokkaido specifically (as opposed to other places).' A cultural observation.