Chinaexpressed high hopes that it will reach its overcapacity in the coal sector byyear-end, Mining.com reported Oct. 3.

Duringthe first eight months of 2016, coal production posted a 10.2% contractionyear-over-year to 2.17 billion tons, said the report.

"SinceFebruary, there is a gap in production of 60 million tons based on the averagemonthly consumption of the past four years," the report quoted FrankSieren, who works for Germany's international broadcaster, Deutsche Welle.

Headded that the coal industry is being "dismantled faster than demand isdecreasing," resulting in the recent surge in global coal prices.

Despitethe global coal price rally, which is largely attributable to China'sovercapacity measures, Beijing is maintaining its plans to shut more than1,000 coal mines bythe end of the year, as well as to not approve new coal mines until at least2019, according to the report.

Aresearch note from China Securities shows that 25 provinces have officiallyannounced their respective capacity reduction plans, which together will reduce China'sannual production capacity of coal by 800 million tonnes over the next three tofive years.