* Iran buying Indian soymeal despite sanctions
* Crude-for-rupees system boosting soymeal sales
HAMBURG, April 9 (Reuters) - Indian soymeal exports to Iran have risen sharply in early 2013 despite trade sanctions and high Indian prices, Hamburg-based oilseeds analysts Oil World said on Tuesday.
"India has become the key supplier of soymeal for Iran owing to the western sanctions," Oil World said.
India exported 142,000 tonnes of the animal feed to Iran in March against only 40,000 tonnes in March 2012, Oil World said. This followed a sharp rise in February exports to Iran.
India's October 2012 to March 2013 soymeal exports to Iran shot up to 430,000 tonnes from only 76,000 tonnes in the same period the year before, Oil World said.
The United States and European Union have toughened trade sanctions, meant to discourage Tehran's disputed nuclear programme, which they say has a military purpose. Iran rejects these allegations and says its atomic work is peaceful.
The sanctions do not target food shipments, but financial measures have frozen Iranian firms out of much of the global banking system, complicating payments for imports on which Iran relies for much of its food and animal feed.
"Iran was again and by far the largest destination for Indian soymeal in March," Oil World said.
It is believed another 200,000 tonnes of Indian soymeal is scheduled for export to Iran in April, for which Iran will pay with revenues from crude oil sales, it said.
India has been paying for Iranian crude oil imports in rupees, which can in turn be used by Iran to buy Indian commodities including rice and soymeal.
Iran is buying more soymeal despite a rise in Indian prices to levels sharply above those of rival South American producers, which has cut demand for Indian soymeal from other potential buyers, Oil World said.
"Demand for Indian soymeal slowed down pronouncedly in recent weeks as a result of widening price premiums over South American origin, to which most importers have shifted in the meantime," it said.
"The export price of soymeal in India climbed further to $585 a tonne on April 4, about $150-$160 (a tonne) above prices in Brazil," it said. (Reporting by Michael Hogan; editing by Jane Baird)