* Chinese buyers cancel/postpone wheat for Feb-April shipments

* Australian wheat cancellations come after similar hit to U.S.

* Global price drops to 3-1/2 year low prompting cancellations

SINGAPORE, March 14 (Reuters) - Chinese wheat importers have cancelled or postponed about one million metric tons of Australian wheat cargoes, trade sources with direct knowledge of the deals said, as growing world stockpiles drag down prices.

News of the moves comes after the U.S. government reported cancellation of more than 500,000 metric tons of U.S. wheat exports last week to China, the world's No. 1 buyer, with international prices trading close to three-and-half year lows.

China increased wheat imports last year after adverse weather damaged its crop, buying mainly Australian, U.S., French and Canadian cargoes.

However, prices subsequently plunged as Russia, the No.1 exporter, began flooding the global market with cheap wheat as it draws down inventories ahead of an expected bumper harvest, which could mean China will look to buy again to lock in lower prices, traders said.

"Chinese buyers have cancelled some deals for Australian wheat, and they are also moving the shipping time from the first quarter to the second quarter, third quarter," said one Singapore-based trader at an international trading company, which sells Australian wheat to Asia.

A second Singapore trader said trading companies have vacated shipping slots across several Australian ports, which were booked for cargoes due for China. Both traders declined to be named because of the sensitivity of the matter.

Benchmark Chicago wheat futures have fallen more than 14% in 2024 to their lowest since August 2020, thanks to ample world supplies. The market was trading down 1.4% at 0906 GMT on Thursday.

'BEARISH INDICATOR'

China, the biggest buyer of Australian wheat, may have booked the cargoes four to five months ago when prices were higher, said Andrew Whitelaw at agricultural consultants Episode 3 in Canberra.

"Cancelling cargoes is a bearish indicator," Whitelaw said. "Whether they are doing it to buy again cheaper or because there’s less demand, it is still a bearish view on the market."

Refinitiv data shows benchmark Russian wheat export prices slipped below $200 a metric ton ($5.44 per bushel) this week for the first time since August 2020, marking the lowest early March price since 2017.

Russia is projected to export a record 51 million metric tons of wheat in the crop year that ends on May 31, up from 47.5 million a year ago, the U.S. Department of Agriculture says.

One million metric tons of wheat would require about 15 Panamax-size vessels of 68,000 tons each to ship, and amounts to more than 4% of Australia's expected total wheat exports of 23 million metric tons in 2023-24.

The second trader in Singapore said some of the Chinese importers who cancelled or postponed purchases have agreed to pay penalties in the form of carrying cost to Australian suppliers.

A Dubai-based grain trader, who declined to be named, said one miller in the Middle East bought a cargo of Australian wheat for shipment in early April without having to wait.

"It wouldn't have been possible before China's move to postpone shipments, as Australian shipping slots were fully taken up," the trader said. (Reporting by Naveen Thukral; additional reporting by Peter Hobson in Canberra; editing by Gerry Doyle and Tomasz Janowski)