LIVERPOOL (Commodity Online) : International Cotton Advisory Committee said global cotton production in the coming season will leap 13% in reaction to surging prices triggered by rebounding demand and dwindling supplies.

In a statement, ICAC said world cotton crop in the year from August 2010 through July 2011 is expected to climb to 114 million bales from 112 million the previous season.

Cotton prices were high compared to alternative crops during the timeframe when cotton farmers make decisions on which crops to plant.

Those prices rose as world textile consumption climbed amid forecasts of recovering economic growth. The Cotlook A Index rose from 64 cents per pound in August to 87 cents in early April.

Global cotton mill use rebounded faster and stronger than expected after a sharp drop in 2008-09 caused by the global financial and economic crisis... ICAC said in the statement.

ICAC projects world cotton ending stocks, a measure of available supply, for the current 2009-10 year will drop by 18% to 48 million bales, their lowest levels in six years.

In the coming 2010-11 year, that rebounding demand will boost 2010-11 world cotton mill use by 2% to 114 million bales, ICAC said.

However, the group noted that demand may be somewhat limited by high prices. World cotton trade is expected to rise to 36 million bales in 2010-11 from 34 million bales the year before, ICAC said in the release.

Global cotton ending stocks are expected to hold at 48 million bales in 2010-11, on par with the previous year, according to the association.

As a result of these supply and demand conditions, the Cotlook A Index is forecast to average 85 cents per pound in the 2010-11 season, a 10% increase from the year before, ICAC said. There is a 95% chance that the average will fall from 71 cents to $1.