BEIJING, March 27 (Reuters): China, the world's top cotton consumer, will increase sales from state reserves of the fibre from April, in a bid to boost dwindling domestic supply, a government official said in a speech published Wednesday.

To help meet demand from textile mills, Beijing will step up sales from its bulging reserves, particularly of high-quality cotton, beginning in April, Li Yan of the country's top economic planner, the National Development and Reform Commission, told a meeting on Tuesday, but gave no further details.

Cotton supplies have been under pressure as a result of China's controversial state stockpiling policy, which has seen the government buy nearly 10 million tonnes, or about 60 per cent of global cotton stocks, since 2011.

Plans for sales by China and India, the world's largest producers of cotton, put New York prices under pressure last week. A four-day slide in prices ended on Tuesday, as reports of new import quotas in China helped buoy the market.

The domestic supply squeeze could worsen this year with China's cotton acreage expected to fall to its lowest in a decade, Gao Fang, an official of the China Cotton Association, said in a speech posted on its website (www.china-cotton.org).

Chinese farmers are likely to grow 6.8 per cent less cotton this year, with the sowing area expected to fall below 4.67 million hectares, its lowest since 2002, Gao said.

The figures are in line with a survey published recently by the influential China Cotton Research Institute, which attributed the decline to the lower returns to cotton farmers, compared with those from planting grain.

Beijing's stockpiling has kept domestic cotton prices as much as 40 per cent higher than global prices, but Li of the NDRC said the government had no intention of changing the policy for the 2013 harvest, and would not set any limits on volumes.