SINGAPORE - Palm-oil producer Bumitama Agri announced on Tuesday that net profit for the first quarter ended March 31, 2015, fell 41 per cent to 181.57 billion rupiah (S$18.44 million) from 307.84 billion rupiah for the year-ago period.

The mainboard-listed company blamed lower selling prices for both crude palm oil and palm kernel, the higher cost of sales, foreign-exchange loss and share of loss of associate companies.

Revenue for the quarter dipped 1.7 per cent to 1.33 trillion rupiah as the lower selling prices offset the increase in sales volume of both products.

The company said it expects crude palm oil prices to remain soft in the near term due to ample supply of other competing vegetable oils such as soya-bean oil, weak crude oil prices and concerns on lacklustre demand for palm oil as the price between soya-bean oil and crude palm oil narrows.

However, Indonesia's mandate to increase the blending rate of palm oil to diesel oil from 10 to 15 per cent (B15), the increase in biodiesel subsidy to 4,000 rupiah per litre and plans to impose levy on export to fund the B15 programme should provide support to prices by sustaining demand for biodiesel, it said.

In the long term, palm-oil industry fundamental remains strong as palm oil is the most consumed edible oil in the world, the company said, adding it will continue to focus on its yield and production improvement, cost containment and capacity building.

No dividends were declared for the quarter.