China, the world's biggest consumer of coal, said demand for and supply of the fuel will "generally balance" by 2010 as producers boost capacity to meet growing energy needs.

The nation's annual demand for coal will be about 3 billion tons within the next three years, close to the projected production capacity, said Wang Xianzheng, chairman of the China Coal Industry Association.

China produced 2.54 billion tons of coal last year, representing an annual increase of 10 percent over the past seven years, Bloomberg News said. Wang said capacity for another 1.1 billion tons a year is being added, while the government would cut small-mine capacity to less than 700 million tons a year from the current 1 billion tons by 2010.

"Despite the balance, regional or sporadic shortages or surpluses of certain kinds of coal products are likely," Wang said. Current supply of thermal coal to power plants was adequate, Wang said.

(Shanghai Daily May 26, 2008)