VEGOILS-Palm ends at one-week high on fears of declining output

* Palm rise for third straight day

* Market expecting October output to fall -trader

* India, China imports to tick up in 2020/21 - Refinitiv (Updates with closing prices, adds details)

By Mei Mei Chu

KUALA LUMPUR, Oct 22 (Reuters) - Malaysian palm oil futures rose nearly 2% on Thursday, closing at their highest in a week, underpinned by fears over lower production and tracking gains in rival Dalian oils.

The benchmark palm oil contract FCPOc3 , for January delivery, on the Bursa Malaysia Derivatives Exchange closed 54 ringgit, or 1.9%, higher at 2,942 ringgit ($709.94) a tonne.

Palm rose for a third consecutive day and logged its highest closing level since Oct. 15.

The market expects lower production this month after a research house estimated that Oct. 1-20 output will drop between 4% and 8% from September, a Kuala Lumpur-based analyst said.

The Malaysian Palm Oil Association also forecast production during Oct. 1-20 to fall about 8% from the same period in September, traders said.

Palm oil imports from key destinations in the 2020/21 season are expected to improve slightly from the last season, but demand from Europe is likely to fall 8.5% because of new biodiesel and food policies, Refinitiv analysts said. pegged India's imports in 2020/21 to rise 4.8% to 8.7 million tonnes. China, the country driving the demand recovery, is expected to hike imports by 3% to 6.9 million tonnes.

Dalian's most-active soyoil contract DBYc3 gained 2.2%, while its palm oil contract DCPc4 gained 2.4%. Soyoil prices on the Chicago Board of Trade BOc1 were up 0.6%.

Palm oil is affected by price movements in related oils as they compete for a share in the global vegetable oils market.

Malaysia said on Thursday it viewed U.S. allegations of forced labour in palm oil plantations as an "old issue" but it was willing to take appropriate action if needed. = 4.1440 ringgit)

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