UPDATE 1-Egyptian court suspends food inspection system meant to ease trade

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CAIRO, June 13 (Reuters) - An Egyptian court on Tuesday suspended an inspection system launched last year and intended to streamline the trade of agricultural commodities for the world's largest wheat buyer, lawyers on the case told Reuters.

The suspension will return wheat inspections to the agriculture ministry's quarantine body, which had been stripped of its inspection authority after it applied a zero tolerance policy on the common grain fungus ergot last year, halting the country's wheat trade when traders refused to sell.

Lawyers said it was unclear whether the suspension of the new system would restore Egypt's controversial ergot ban, but the state's grain buyer GASC told Reuters last week it intends to allow up to 0.05 percent of ergot in its wheat purchases, a common international standard.

The government has 15 days to appeal the decision, the lawyers said.

The new system was imposed by a decree in November that named the General Organization for Export and Import Control (GOEIC), which is part of the trade ministry, as the body responsible for inspecting grain imports.

It stipulated that private companies would conduct inspections at ports of origin rather than agriculture quarantine inspectors, who have argued that a ban on ergot is required to protect human and plant health.

Grain traders said on Tuesday they expected the ruling to bring quarantine inspectors back to foreign ports but keep the permitted level of ergot at 0.05, potentially avoiding the trade disruptions seen last year.

GASC is holding an international purchase tender for wheat on Tuesday with results expected later in the day. (Reporting by Arwa Gaballa and Maha El Dahan; writing by Eric Knecht, editing by Jason Neely and David Evans)