UPDATE 3-Australian sugar workers suspend strikes after threat to bar them from mills

(Adds union response in paragraphs 1-3 and 10)

By Peter Hobson

CANBERRA, June 4 (Reuters) - Workers at Australia's largest sugar producer will temporarily halt industrial action after the company threatened to bar those who took part in work stoppages from its mills and stop paying them, a union representative said.

Wilmar Sugar and Renewables is locked in a pay dispute with workers that has that seen several walk-outs in recent weeks and delayed the start of sugar production.

A suspension of industrial action should allow unionised employees to keep working until a vote on a company pay offer next week that unions say is too low and will be rejected, potentially leading to a resumption of strikes.

"Today, Wilmar Sugar and Renewables advised more than 1,200 wages employees that anyone participating in industrial action from start of shifts tomorrow morning (Wednesday 5 June) will be locked out until further notice," the company said on Tuesday.

Locked-out workers would not be able to enter Wilmar's facilities and would not be paid until the measure was lifted, it said.

Wilmar Sugar and Renewables has eight mills on Australia's northeast coast that produce more than half of the country's sugar during the cane crushing season that runs from June to November. It is owned by Singapore-based Wilmar International Ltd.

The company has delayed the start of cane processing at its mills by between two and nine days after strikes disrupted preparations.

Australia is the world's fourth-largest sugar exporter. A long delay to crushing could damage cane growers and reduce production.

Wage negotiations are paused until the vote on a pay offer on June 10 and 11. Rolling work stoppages and bans on performing certain jobs and overtime were planned in the run-up to the ballot.

"Our delegates have resolved to lift the industrial action and focus on getting Wilmar's substandard offer voted down," Australian Workers' Union official Jim Wilson told Reuters.

The union also said workers at Tully Sugar, a mill in northeast Australia owned by Chinese conglomerate COFCO, had issued striking workers with a lock-out notice on Tuesday.

As with Wilmar, workers at Tully are seeking a larger pay rise and industrial action has delayed the start of its cane crush, the union said.

Tully, COFCO and COFCO Sugar did not respond to requests for comment.

Union officials described the lock-out notices as bullying and intimidation and company pay offers as unfair.

A Wilmar spokesman said: "We respect employee rights to union membership and their right to take lawful industrial action," but added that the company had tried to negotiate and had the right under employment law to protect its interests.

(Reporting by Peter Hobson; Editing by Jacqueline Wong, Louise Heavens and Ros Russell)