China Shanxi 2009 coal output to fall 5 pct on yr -Xinhua

SHANGHAI Nov 30 (Reuters) - Shanxi, which had long been China's top coal producing province, expects its coal output this year to drop 5 percent from a year earlier to about 620 million tonnes, the official Xinhua News Agency said on Monday.

Shanxi had been China's top coal producing province until earlier this year when it was replaced by Inner Mongolia, in part because the province has been pushing for consolidation of the industry and closure of inefficient and dangerous small mines.

Shanxi produced nearly 490 million tonnes of coal in the first 10 months of the year, down 8 percent from a year ago, the Xinhua report said.

But lately coal production has been growing each month, and output in the fourth quarter is expected to reflect that trend although it will not likely be a sharp increase, Xinhua said.

Shanxi plans to produce 670 to 700 million tonnes of coal in 2010, up at least 8 percent from this year, Xinhua quoted the Shanxi provincial government as saying.

"With the steady recovery of the domestic economy, next year our country's coal market will see a mild growth in both supply and demand, which will result in a basic balance in coal supply and demand, as well as steady prices," said Xinhua.

Inner Mongolia, currently China's top coal producer, churned out 516 million tonnes of coal in the first 10 months of the year, up 28.2 percent on year, the Inner Mongolia Coal Industry Administration said on its website. (www.nmgmt.gov.cn)

China is expected to produce nearly 3 billion tonnes of coal this year, and net imports of the hydrocarbon will exceed 100 million tonnes, Xinhua said last week. (Reporting by Rujun Shen and Edmund Klamann; Editing by Ken Wills) ((rujun.shen@thomsonreuters.com; +86 21 6104-1779; Reuters Messaging: rujun.shen.reuters.com@reuters.net)) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com))