* Palm's wide discount to soy will stir demand -trader * Palm oil to rise to 2,522 ringgit -technicals * India may raise import duties for edible oils by end-March -Mistry (Updates prices) By Anuradha Raghu KUALA LUMPUR, Jan 30 (Reuters) - Malaysian palm oil futures rose to their highest in nearly 4 weeks on Wednesday, fuelled by expectations that dry weather could hurt crops in top soy producer Argentina and shift demand to the cheaper edible oil. Dryness in parts of Argentina, the world's No.3 exporter of soybeans, has raised supply concerns and pushed up prices, potentially turning buyers to palm oil, now trading at a discount of more than $300 a tonne. "The rise of palm oil in the last few days is attributable to external strength. A lot of investors believe that the discount between palm and soy is quite big, and this will stir demand for palm," said a trader with a foreign commodities brokerage in Kuala Lumpur. "Buyers are always turning to cheaper options if possible. People will jump at this kind of opportunity. The cheapest oil will always prevail." The benchmark April contract on the Bursa Malaysia Derivatives Exchange rose 1.4 percent to close at 2,510 ringgit ($814) per tonne, just off its intraday high of 2,512 ringgit, a level unseen since Jan. 3. Total traded volumes stood at 24,129 lots of 25 tonnes each, slightly smaller than the usual 25,000 lots, with traders waiting for cues from January's export data which will be released on Thursday. Technical analysis shows palm oil is expected to rise to 2,522 ringgit per tonne, as it has cleared a resistance at 2,486 ringgit, said Reuters market analyst Wang Tao. Leading industry analyst Dorab Mistry said on Wednesday that he expected India, the world's biggest edible oil buyer, to hike import duties on palm oil and soyoil again by the end of March to protect its domestic oilseed farmers. In January, India raised its duty on crude imports to 2.5 percent from zero and lifted a six year freeze on taxable value of cargoes to curb cheap imports from top palm suppliers Indonesia and Malaysia. But Malaysia, the world's No.2 producer, will continue to offer the market's cheapest vegetable oil in February as top rival Indonesia will increase its crude palm oil export tax to 9 percent while Malaysia maintains its duties at zero percent. Brent crude oil fell slightly on Wednesday but held close to a three-month high above $114 a barrel, underpinned by optimism about the U.S. economy after data showed a recovery was gaining ground. In competing vegetable oil markets, U.S. soyoil for March delivery rose 0.4 percent in late Asian trade. The most active September soybean oil contract on the Dalian Commodity Exchange closed 0.5 percent higher. Palm, soy and crude oil prices at 1011 GMT Contract Month Last Change Low High Volume MY PALM OIL FEB3 2450 +48.00 2410 2450 498 MY PALM OIL MAR3 2480 +37.00 2442 2480 3787 MY PALM OIL APR3 2510 +35.00 2474 2512 14501 CHINA PALM OLEIN SEP3 7072 +64.00 7000 7080 361290 CHINA SOYOIL SEP3 8734 +40.00 8664 8748 435582 CBOT SOY OIL MAR3 51.92 +0.21 51.60 52.03 7548 NYMEX CRUDE MAR3 97.70 +0.13 97.32 97.75 10042 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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