KUALA LUMPUR, Jan 30: Malaysian crude palm futures rose nearly 2 per cent on Friday as more investors streamed back into the market, heartened by concerns of sharp falls in domestic production this month, traders said.

Palm oil, used in biscuits to biofuels, bounced from three-week lows hit the previous day and snapped three straight days of losses although weakness in U.S soyoil markets cut some gains in Asian trade.

There is some talk that January production might have fallen by 20 per cent, which is the result of plantations cutting down on fertilisers six months ago during the palm price slump, a head trader with a local brokerage said.

Output would then probably be 1.19 million tonnes in January compared with 1.48 million the month before, traders say.

The benchmark April contract closed up 34 ringgit at 1,779 ringgit ($493.3) as traders were also taking positions ahead of a long holiday weekend. The Malaysian palm oil market will be closed on Monday.

Other traded contracts ranged between a 20 ringgit drop to gains of 40 ringgit. Overall volume shot up to 13,970 lots of 25 tons from 10,000 lots.

Traders were also eyeing Jan. export data by cargo surveyor Intertek Testing Services due over the weekend while Societe Generale de Surveillance reports on Monday.

In Indonesia, the world’s largest palm oil producer, the state marketing centre said it did not hold a palm oil tender on Friday. The centre normally sells palm oil from state plantations.

Producers in Medan -- home to Belawan port, Indonesia’s key palm oil export port -- sold palm oil at 6,150 rupiah ($0.54) per kg, against 6,126 rupiah per kg on Thursday.

Meanwhile, refiners in Jakarta sold refined, bleached, deodorised (RBD) palm oil, used as cooking oil, at 6,650 rupiah per kg, unchanged from Thursday.

In the Malaysian physical market, palm oil for Jan. and Feb. shipment was quoted at 1,770-1,790 ringgit per ton in the southern and central regions. Trades were called between 1,760 and 1,770 ringgit. —Reuters