Agricultural firm PGG Wrightson is posting profit losses as the dairy downturn continues to have an effect.

The company reported a 19% drop in its surplus for the last half of 2015.

That's almost $4m less than the profit for the corresponding period in the previous year.

Farmers are being more conservative with their spending as a result of falling dairy prices and fears of ongoing drought.

PGG Wrightson is expecting full year earnings to be at the lower end of its forecast range of around $60m before costs.