BILIN, West Bank, June 26 (Reuters) - Israel began repositioning part of its contested barrier in the occupied West Bank on Sunday, four years after a court ruled it should be re-routed to give Palestinians greater access to farmland.

Israeli tractors tore down a section of the barrier, a metal fence, as a clutch of journalists watched. A new concrete barrier has been erected some 600 meters from the old route near the Jewish settlement of Modiin Illit.

The Israeli military tore down a watchtower overlooking Bilin on Wednesday and protesters rammed a bulldozer into the fence on Friday.

The section covered by the ruling is in Bilin, a Palestinian village about 25 km (15 miles) east of Tel Aviv, and the scene of often violent weekly protests against a barrier Israel calls a security necessity and Palestinians condemn as a land grab.

The Israeli courts ruled in 2007 that the fence had to be moved after a petition from Bilin landowners two years previously. This prompted a to-and-fro with Israel's Defence Ministry until a final re-routing plan was accepted.

Colonel Saar Tzur, commander of an Israeli military brigade in the region, said moving the barrier would give Palestinians access to about 140 acres (57 hectares) of farmland, though they still remain cut off from a further 50 (20 hectares) of land.

Mohammed al-Khteeb, coordinator for Bilin's Popular Resistance movement, said the move was good, but not enough.

"It makes me happy but still we are far away from what we are looking for and what we want to achieve, because the largest part of the village lands are still confiscated by the new route," Khteeb said.

Israel started building the network of metal fencing, barbed wire and concrete walls in 2002 following a wave of Palestinian suicide bombings.

The World Court in The Hague said in 2004 that the proposed 720-km (430-mile) barrier cutting through the West Bank was illegal, citing its route inside territory that Israeli forces occupied in a 1967 war.

Tzur said the total cost of the re-routing came to 31 million NIS (about $9 million), including Israel's replanting of Palestinian-owned olive trees to prevent them from being damaged by the work. (Additional reporting by Ali Sawafta and Dan Williams; Editing by Jan Harvey)