LONDON/BEIJING, May 22 (Reuters) - A slide in sugar prices driven by excess supplies may be given fresh impetus soon with China, one of the world's top importers, likely to cut back on purchases after a sharp jump in stocks.

China's sugar stocks more than doubled last season, leading many to expect a significant fall in purchases in 2012/13. So far trade flows have held up well, but action stopping short of an official duty hike is expected soon to clip inflows.

"If China were to continue to buy large tonnages of sugar, that would be a bullish signal. But I believe that imports will slow to a trickle," said Robin Shaw, sugar analyst with London-based brokerage Marex Spectron.

Inflated domestic prices in China have provided a strong incentive for private buyers to import sugar from a world market overflowing with surplus supplies and which is now trading at its lowest levels in nearly three years.

ICE raw sugar futures touched 16.81 cents a lb on May 16, the lowest level on a front month basis since July 2010.

Large cane crops in key producers such as Brazil, Thailand, Australia andMexico have generated a substantial global sugar surplus this season. Top exporter Brazil is currently harvesting its massive crop in ideal weather.

Stockpiling by China in 2011/12 removed a substantial chunk of that season's global surplus from the market.

Dealers said other major buyers such as Indonesia were unlikely to fulfil a similar role this season, leaving the market awash with supplies.

The International Sugar Organization earlier this year forecast a global surplus of 8.53 million tonnes in 2012/13, surpassing the prior season's 6.48 million tonnes surplus.

Dealers said Chinese authorities would likely put pressure on private importers not to bring in sugar.

"All you need is for a customs officer not to process your documents for 10 days, triggering huge demurrage costs, and you would not want to import again," said one trade source.

DOMESTIC PRICE HIGH

China has kept domestic prices high to protect its growers and address a yawning gap between rural and urban incomes.

The country's farmers face among the highest sugar production costs in the world at around 30 cents per lb, compared with roughly 18-19 cents per lb in Brazil.

"I think it is a difficult situation for the government - they want to support China's farmers, but costs are spiralling higher," said Tom McNeill, a director at commodity analyst Green Pool in Brisbane.

Refineries in China are able to buy up to 1.9 million tonnes of quota sugar every year under an agreement with the WTO.

Companies without quotas, which face import taxes of 50 percent, have also been able to profit on imported sugar due to the large gap between domestic and global prices. Premiums between Zhengzhou and London futures are over $300 per tonne.

A sugar trader at an international firm in China said: "Even if the economics are there, I believe the government is not willing to see too many non-quota imports. I believe they will put pressure on private importers."

The high domestic premium has led to talk that China could seek to cut private imports by raising non-quota import duties, but many dealers see this as an unlikely outcome.

"The Chinese built up their stocks by 6 million tonnes over the past two years. You can't go on buying indefinitely," one senior London-based sugar trader said.

But several dealers doubted a duty increase was imminent.

"Since China introduced its import quota system, it has never been adjusted," said Zhan Xiao, analyst at Xinhu Futures.

"China is not like other countries such as Russia or other import countries that adjust the tariff according to import volumes," Zhan said. "China has no precedent for this kind of adjustment. So in the mid to short-term, it's relatively hard to introduce such a measure."

The high domestic sugar premium has also sparked smuggling, which officials estimate at between 500,000 and 1 million tonnes a year, as well as the legitimate tariff-paying imports.

Dealers said a renewed crackdown on smuggling by Chinese authorities would be another way to keep a lid on imports.

"The government has said it will strengthen management of quotas. There are no specific details but they could step up their efforts in investigating smuggling," said Hou Yating, analyst at Dalu Futures.

Chinese sugar imports so far in 2012/13 were nearly 1.3 million tonnes, compared to 1.77 million tonnes imported in the same period of 2011/12, according to the ISO. Those totals, however, exclude any sugar smuggled into the country.