China's coal output rose 6.8 percent year on year to 827 million tonnes in the first four months of 2009, an industry association official said here Friday.
The global economic slowdown has taken a toll on the coal industry, Jiang Zhimin, deputy director of the China Coal Industry Association, said at the 5th China Energy Strategy Summit in Beijing.
"Weak demand has resulted in a clear trend for overcapacity," he said.
The industry faces challenges of eliminating out-dated production facilities and the building of more modern and large coal mine groups, Jiang said at the two-day event, which ends Saturday.
Around 70 percent of the 80,000 coal mine producers in China are small. They each have an annual production of 300,000 tonnes, Jiang announced at the two-day event which ends Saturday.
China has 24 coal mine groups which each have an annual output of more than 10 million tonnes. In 2008, those groups produced a total of 840 million tonnes, he said.
The Chinese government has been encouraging mergers and acquisitions to build more large mining groups for efficiency and work safety.
Weak demand creates conditions for transforming the extensive growth mode of the industry, Jiang stated.
"While we tackle the financial crisis, we should eye the long-term development of the coal industry," he said. "We should consider building more internationally competitive coal mine groups and increase spending to curb major colliery accidents."
China's coal demand is estimated to reach more than 3.5 billion tonnes in 2020, he said.
Last year China produced 2.72 billion tonnes of coal, up 7.65 percent from 2007. It consumed 2.74 billion tonnes, up 3 percent.