10/06/2008 (Reuters, India), New Delhi - A leading Indian farm co-operative has contracted to import 24,000 tonnes of vegetable oils and plans to buy 120,000 tonnes by March to help improve domestic supplies, its managing director said on Tuesday.

India is the world's biggest vegetable oil importer after China and in late March abolished import duty on crude palm oil and cut the tax on refined oils to 7.5 percent to check inflation, which has leapt to 3-1/2 year highs.

A leading trade official told Reuters earlier that India was likely to buy 7 percent more vegetable oils this year but is not expected to further cut duties.

U.K.S. Chauhan, managing director of the National Agriculture Cooperative Marketing Federation of India (NAFED), told Reuters the body was importing the oils for the government as high global prices had forced a halt to purchases for its own commercial use.

It will buy 18,000 tonnes of RBD palmolein and 6,000 tonnes of crude soyoil.

Benchmark Malaysian crude palm oil futures fell 3.6 percent to 3,530 ringgit ($1,081) per tonne on Tuesday, as a build-up in supplies dragged down prices from near two-week highs hit the day before.

High global vegetable oil prices usually dent demand in India, which imports almost half of its domestic annual consumption of around 11 million tonnes. Palm is shipped from Malaysia and Indonesia, and soyoil from Brazil and Argentina.