Commodity prices to increase in 2011 - WTO chief

* Crude oil, copper, corn, soybean prices seen rising most

* Natural gas, zinc, cattle prices to increase less

By Laura MacInnis and Amena Bakr

GENEVA, Jan 31 (Reuters) - Economic recovery will make food, metals and other raw materials more expensive in 2011, the head of the World Trade Organization said on Monday. Addressing a United Nations conference, WTO Director-General Pascal Lamy said the prices of crude oil, copper, gold, corn and soybeans would rise most this year, with less pronounced increases in natural gas, zinc and cattle.

"2011 will see the prices of most commodities rise, as the rise in global GDP bolsters demand, led by emerging economies," the Frenchman said, estimating worldwide economic output would increase 4 percent in 2011.

"Over 70 percent of the growth will come from commodity-intensive emerging markets. China, India and Latin America, in particular, will be acting as a &${esc.hash}39;pull&${esc.hash}39; for global commodities," Lamy said.

Rising commodity prices could be a boon for countries where raw materials are grown, mined, produced and refined.

But higher food prices can also pinch the world&${esc.hash}39;s poorest people, who spend almost all of their income on basic staples, said David Nabarro, the U.N.&${esc.hash}39;s special representative on food security and nutrition.

Rises in agricultural goods prices will have an inflationary effect felt hardest in poorer countries, Nabarro said. But he urged countries to avoid blocking food exports in response to price spikes or worries about supplies.

"The imposition of export bans, though it may make political sense, can have a very detrimental impact on markets for coarse grains and other basic foodstuffs," Nabarro said.

Supachai Panitchpakdi, head of the U.N. trade and development agency UNCTAD, warned that commodity traders and a growing number of investors in agricultural goods were causing "speculative distortions" in many markets.

Emergencies such as floods in Pakistan and fires in Russia led to spikes in prices for wheat, cotton and other goods, he said, also estimating copper prices have risen 35 percent since last summer, with gold, sugar and cotton at three-decade highs.

Such volatility makes it hard for governments to budget and plan their spending, and makes countries vulnerable to a shock if commodity prices that once filled coffers fall again, the former deputy Thai prime minister said.

"UNCTAD remains concerned about the possible lopsided development consequences of undue reliance on the commodity economy in many countries," he said.

Lamy said the WTO&${esc.hash}39;s Doha round, a global free trade accord under negotiation for nearly a decade, could dismantle barriers to agricultural trade and slash "extremely high tariffs" on goods such as rice as well as agricultural subsidies in rich states that distort global prices of goods including cotton.

"The Doha round, when completed, will oil the wheels of international trade in commodities, giving the developing world its fair share of the market," he said.

(Editing by Jason Neely)