27/06/2013 (Reuters) - Finnish refiner Neste Oil's chief executive said the company's renewable fuels unit was on track to post its first full-year profit in the current year.

The unit, which specialises in making diesel from palm oil and animal waste fat, has posted losses every year since it began reporting its own results in 2008.

It is still a small part of Neste Oil's business but is seen as a key source of long-term growth for the company, which is trying to differentiate itself from its bigger rivals in the traditional oil refining business.

The unit turned profitable for the first time in the first quarter, with a comparable operating profit of 26 million euros ($34 million) versus a loss of 2 million a year earlier.

"The full year will be profitable," Chief Executive Matti Lievonen told Reuters in an interview on Wednesday. He said more stable prices of palm oil had helped the business.

"Since the middle of the third quarter of last year the raw material prices have been quite stable," Lievonen said.

Neste Oil has invested 1.5 billion euros in the business, including plants in Porvoo, Singapore and Rotterdam, but its run of losses had frustrated some investors.

($1 = 0.7649 euros)