14/07/2012 (Reuters) - India's palm oil imports fell by a greater-than-expected 26 percent in June from the previous month as high global prices and a weak rupee in the second half took their toll on demand in the world's biggest buyer, industry data showed on Friday.

Importers bought 381,613 tonnes of crude palm oil, down 27 percent on the month, Solvent Extractors' Association (SEA) data showed, below average expectations in a Reuters poll.

Refined palm oil imports fell by a quarter to 124,125 tonnes as buyers feared New Delhi would raise import taxes on their purchases in response to demands from domestic refiners to tackle cheap imports from Indonesia.

Indonesia, the world's No. 1 palm oil producer, altered its taxes in October 2011 to make exports of refined oil more attractive than crude palm oil to promote its downstream industry.

About 80 percent of India's vegetable oil imports are palm oil, and refined product now accounts for about a third of that, up from around 16 percent before Indonesia's tax changes.

India is the world's largest buyer of vegetable oils according to the United States Department of Agriculture, closely followed by China.

Global supply concerns over soyoil, a rival to palm oil, due to dry weather in soybean areas of the United States, and the weak value of the Indian rupee made palm oil imports costlier, a Mumbai-based trader said.

In the second half of June, palm oil futures rose about 6 percent, while the Indian rupee touched a record low of 57.32 per dollar on June 22.

Benchmark crude palm oil prices on the Bursa Malaysia gained 0.6 percent to 3,030 ringgit ($944) per tonne on Friday.

The gap between crude and refined palm oils has narrowed to just $28 per tonne from $73 a year ago, said B.V. Mehta, the executive director of the Mumbai-based trade body, in the statement.

Refined palm oil imports rose 89.3 percent in the first eight months of the year from November, fuelling calls by local refiners to curb cheap imports from Indonesia.

The heavier-than-expected fall in palm oil purchases brought the country's total vegetable oil imports to 783,315 tonnes in June, down 12.7 percent from May.

A Reuters survey had forecast average total vegetable oil imports of 854,375 tonnes in June.

India buys mainly palm oil from Indonesia and Malaysia and a small quantity of soyoil from Argentina and Brazil.

Soyoil imports more than doubled over May as delayed shipments from South America arrived, while sunflower oil imports were down 30 percent from the previous month as demand for fried stuffs declined in the hot summer, with temperatures in the capital soaring to 30-year records.