US spot month was down no less than 4.26% or 2.23 cents per pound, partly due to fund liquidation ahead of March expiration. By comparison, May was only down 3.50% or 1.97 cents.

Closing at 54.35 cents, May could rapidly test the 60 cent-level, experts anticipate.

The US Department of Agriculture announced encouraging exports, including sales of nearly 100,000 US bales to Turkey and 64,700 bales to China.

No sharp rise in US crop in 2003

In addition, US planting areas are not expected sharply rising next season although prices were substantially up from their October level.

According to the annual survey by US cotton association NCC, US cotton farmers would plant 14.05 million acres this spring, a 0.6% increase from last year.

The rise in planting areas reflects a 1.1% increase in upland cotton intentions while extra long staple (ELS) areas would be down 24.7% as a result of historically low prices.

Total US production would be 17.10 million US bales in season 2003-2004 (August-July), compared to a USDA's estimate of 17.15 million bales for 2002-2003.

As usual, the NCC is possibly underestimating US coming crop in order to sustain current prices, observers warned.

On his side, US cotton exporter William Dunavant just raised its estimate from 14 million acres up to 14.2-14.3 million acres, Reuters reports.

New record for China's production

More important, China announced a 17% rise in planting areas as a result of higher cotton prices with increases ranging from 10% to 31.9% depending on provinces. The forecast was based on a survey by China's Agricultural Ministry with more than 15,300 farmers.

In addition, average cotton yields are also expected rising in China in the coming years, from 1,134 kilos per hectare in 2002 up to 1,217 kilos in 2005.

Anticipating China's survey, the ICAC substantially raised its production forecast with China's crop now expected rising 15% in next season to a record level of 5.44 million tons.

Since production is also expected rising in India and Pakistan as a result of higher prices, global cotton output would be up 7.5% in 2003-2004, said the Washington-based International Cotton Advisory Committee.

The increase of 1.5 million tons would not offset a production decline of 19.3 million tons this season, however.

In addition, the ICAC also raised its consumption forecast for next season from 95.90 million tons to a record level 97.30 million tons.

Thanks to its success on global textile and apparel markets, China would take the largest part of the consumption increase, obviously.

As a result, average Cotlook A Index for 2003-2004 was raised from 54 cents still forecasted in January up to 57 cents per pound.

For the current season, average Cotlook A Index was also raised from 53 cents to 55 cents at the same time as a clear sign that international prices are expected further rising in the coming weeks.

Pakistan

In Pakistan, for instance, prices continued increasing last week with official spot rate for Grade 3 climbing from 2,411 rupees per 40 kilos up to 2,374 rupees. Demand again came from cotton spinners but also from cotton exporters.

India

In India, prices sank following New York's fall but are still expected rising in the coming weeks. Cotton arrivals are lower than last season with a better cotton quality, the US embassy reports.

The current crop could finally be between 13.5 and 14.5 million Indian bales (170 kilos each) from 14.8 million bales last season.

Boosted by an expected lack in production and the rise in international rates, prices steadily increased in the past three months.

Depending on varieties, prices are ranging from 43 to 77 cents per pound about 17 to 33% higher than a year ago, the report says.

They are still lower than international prices, however. As a result, imports are expected falling this season from 381,000 tons down to 255,000 tons, although production is also declining.

Egypt

In Egypt, prices were not raised by Alexandria's cotton exporters' association Alcotexa. A series of grades had been increased by 1 cent.

Turkey

In Turkey, prices did not rise either, although demand sharply rose with spinners accumulating stocks ahead of a possible US-Iraq war in the region. Price of benchmark Standard-1 Guaranteed is still 2,050,000 lira per kilo.