Forecast downgraded

PGG Wrightson has downgraded its operating ebitda forecast on the back of a deterioration on market conditions impacting the agricultural sector.

It was now expected to be $43 million, down from $50m, for the financial year to June 30.

Chairman Garry Moore said features contributing to the restrained spend patterns being seen included drought conditions in parts of the country, weak sheep meat demand from China and increased supply culminating in lower farmgate returns and interest rates and input costs also remaining elevated.

Although the harvest season had been broadly positive, there was also a time lag in the conversion cycle before farmers and growers saw the financial benefits from their harvest production.

Despite the difficult market conditions, PGW remained positive about the prospects for the sector over the medium to longer term, he said.