* U.S. dry weather weighs on global oilseed supplies * Palm oil to rebound to 3,053 ringgit -technicals * Coming Up: Malaysia's July 1-20 exports data; Friday (Updates prices) By Chew Yee Kiat SINGAPORE, July 19 (Reuters) - Malaysian crude palm oil futures rebounded from a 3-week low on Thursday, as the worst drought in the United States since 1956 threatened to squeeze global oilseed supplies further and offset slower exports and better output in Malaysia. Oppressive heat and a worsening drought in the U.S. Midwest pushed grain prices near or beyond records this week and raised concerns of a smaller supply of soybean oil, shifting more demand to the cheaper palm oil. "The market is staged for a rebound as drought concerns are revived. Also, palm oil is now at a discount of over $260 to soyoil, and that will attract arbitrage activity to narrow the spread," said a dealer with a foreign commodities brokerage in Malaysia. The benchmark October palm oil futures on the Bursa Malaysia Derivatives Exchange gained 1.7 percent to close at 3,045 ringgit ($966) per tonne after touching a low of 2,986 ringgit, a level unseen since June 28. Traded volumes stood at 31,771 lots of 25 tonnes each, higher than the usual 25,000 lots. On the technicals front, palm oil will rebound to 3,053 ringgit, Reuters market analyst Wang Tao said. Palm oil futures eased more than 100 ringgit earlier this week as Malaysia's July 1-15 palm oil exports tumbled more than 20 percent from a month ago with stronger production expected for the month. Slower exports and a higher output could boost palm oil stocks that fell to a 14-month low in June, helping to ease concerns of tight oilseed supplies. Market players will be watching closely for consumption trends as cargo surveyors Intertek Testing Services and Societe Generale de Surveillance issue export numbers for July 1-20 on Friday. Palm oil plantation owners in Southeast Asia are also watching for the possibility of an El Nino weather pattern returning to the region at the end of the year, leading to dry weather that could hurt palm oil production. In related market, oil rose above $106 a barrel on Thursday to hit a seven-week high as a rise in tension in the Middle East brought supply concerns back into focus. In other vegetable oil markets, the most active U.S. soyoil for December delivery fell 0.6 percent by 1005 GMT and the most active January 2013 soyoil contract on the Dalian Commodity Exchange closed 0.4 percent higher. Palm, soy and crude oil prices at 1004 GMT Contract Month Last Change Low High Volume MY PALM OIL AUG2 3025 +55.00 2974 3025 502 MY PALM OIL SEP2 3040 +58.00 2981 3047 5615 MY PALM OIL OCT2 3045 +52.00 2986 3056 19407 CHINA PALM OLEIN JAN3 8052 -30.00 8008 8100 419540 CHINA SOYOIL JAN3 9820 +40.00 9758 9838 564358 CBOT SOY OIL DEC2 55.17 +0.32 54.65 55.29 7819 NYMEX CRUDE AUG2 90.85 +0.98 89.86 90.87 9167 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

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