* Palm oil's target of 3,244 ringgit aborted - technicals * Heavy rain warning for Johor - M'sia weather office * Palm oil to average 3,000 ringgit in 2012 - poll (Updates throughout) By Chew Yee Kiat SINGAPORE, Jan 18 (Reuters) - Malaysian crude palm oil futures inched up on Wednesday as expectations that erratic weather in South America and Southeast Asia could limit edible oil supply overshadowed lingering European debt worries. Investors shifted their focus back to Europe ahead of a Portugal debt sale and as Greece resumes its debt restructuring talks. But prospects of worsening drought in Argentina and wet weather in Malaysia lifted palm oil futures, which are slightly up by 0.2 percent so far this year. "For the next two days, things will slow down as the long weekend is coming and traders will be off. We can look forward to some position squaring," said a trader with a foreign commodities brokerage in Malaysia, referring to the Lunar New Year holidays next week. Benchmark April palm oil futures on the Bursa Malaysia Derivatives Exchange rose 0.5 percent to close at 3,180 ringgit ($1022) per tonne. Traded volumes picked up after the midday break to end at 26,861 lots of 25 tonnes each, compared to the usual 25,000 lots. Reuters market analyst Wang Tao revised his price forecast, saying that the bullish target at 3,244 ringgit has been aborted and a more realistic target will be 3,108 ringgit. The Malaysian Meteorological Department issued a warning that heavy rain may cause flash floods in parts of Johor, a key oil palm grower in the country that accounts for about 15 percent of national output. Investors are worried that wet weather may hamper the production and distribution process of palm oil, lowering supply and pushing prices up. But slowing demand could help ease pressure from tightening stocks as top buyers, including China and India, cut back orders. Cargo surveyor data showed an 11 percent drop in Malaysian's palm oil exports for the first 15 days in January. For top producer Indonesia, exports declined 29 percent in December compared to November based on Reuters calculation. A median poll of 25 analysts tracking top palm oil producers Indonesia and Malaysia showed 2012 price expectations for the tropical oil stood at a median 3,000 ringgit per tonne, unchanged from a survey conducted in July. In related markets, Brent crude rose above $112 on Wednesday as the dollar weakened and a slew of positive economic indicators, from China to the United States, eased demand concerns triggered by the debt crisis in Europe. The U.S. soyoil contract for March delivery were down 0.2 percent while the most active September 2012 soyoil contract on China's Dalian commodity exchange eased 0.3 percent. "The Dalian market is quiet and directionless today -- it's still pricing in the USDA report and South American weather," said Huang Zhi Qiang at Guotai Junan Futures in Shanghai. "This should be the trend for now. There shouldn't be any major price movements when the market reopens after the Lunar New Year holidays unless we hear of any extreme news," the analyst added. Palm, soy and crude oil prices at 1006 GMT Contract Month Last Change Low High Volume MY PALM OIL FEB2 3190 -5.00 3159 3190 1776 MY PALM OIL MAR2 3185 +10.00 3145 3185 5956 MY PALM OIL APR2 3180 +16.00 3136 3180 11807 CHINA PALM OLEIN SEP2 7922 -38.00 7918 7994 80378 CHINA SOYOIL SEP2 8902 -24.00 8902 8972 220502 CBOT SOY OIL MAR2 50.67 -0.10 50.47 50.85 8337 NYMEX CRUDE FEB2 101.00 +0.29 100.53 101.43 14786 Palm oil prices in Malaysian ringgit per tonne CBOT soy oil in U.S. cents per pound Dalian soy oil and RBD palm olein in Chinese yuan per tonne Crude in U.S. dollars per barrel ($1 = 3.11 ringgit) (Editing by Sugita Katyal)

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