China posted its largest trade deficit in at least a decade, fanning concerns that slowing exports from the world's second largest economy will hurt global growth, as well as demand for palm oil. The US Department of Agriculture report on Friday was also slightly bearish on soybean oil prices, showing the fall in total consumption outpaced the decline in production. "Overall, the news is slightly negative for CPO prices as it tracks soybean oil prices closely. However, the low production season in the first quarter, and improving demand from China and India, should support CPO prices in the near term," said Alan Lim, research analyst with Kenanga Investment Bank in Malaysia. Benchmark May palm oil futures on the Bursa Malaysia Derivatives Exchange lost 1 percent to close at 3,317 ringgit ($1,097) per tonne. Prices hit a 9-month high of 3,368 ringgit on Friday. Traded volumes stood at 27,074 lots of 25 tonnes each, slightly higher than the usual 25,000 lots. Bullish price outlooks from top analysts at a key palm oil conference sent prices to new highs last week, setting the stage for a price correction, said some traders. "The market is technically overbought. The palm oil conference contributed to this, but the surging price is a double-edged sword. At some point it can cause demand destruction," said a Malaysia-based trader. Malaysian palm oil exports for the first 10 days of March surged close to 30 percent to 444,259 tonnes, cargo surveyor Intertek Testing Services said on Saturday. Another cargo surveyor Societe Generale de Surveillance reported a slightly higher 32 percent increase in exports to 448,615 tonnes. But the increase in exports is unlikely to have much of an impact on prices, as it was also matched by a rise in stocks. Malaysia's February palm oil stocks were higher than expected and stayed above the psychologically key level of 2 million tonnes. The stock level rose 2 percent to 2.06 million tonnes from a revised 2.02 million in January, industry regulator the Malaysian Palm Oil Board said. Oil prices fell on Monday, snapping four days of gains as worries over supplies from the Middle East eased and investors focused on the health of the global economy and fuel demand. In other vegetable oil markets, the most active US soyoil contract for May delivery fell 0.4 percent in Asian trade and the most active September 2012 soyoil contract on China's Dalian Commodity exchange rose 0.2 percent.