China produced about 385.5 million metric tons of coal last month, National Bureau of Statistics (NBS) data showed, equivalent to 12.44 million metric tons per day.

That was down from 12.72 million metric tons in April, and compared with 12.09 million metric tons a year before.

Production over the January-May period was 1.91 billion metric tons, 4.8% higher than a year earlier, the data showed.

Average utilisation rates at 442 major coal mines in China's top mining hubs, Shanxi, Shaanxi and Inner Mongolia, dropped to 83.5% in May from 85.2% in April, according to data compiled by the China Coal Transportation and Distribution Association (CCTD).

Coal inventories at Chinese ports and major coal-fired power plants hit near record high levels in early June as the country struggled with economic recovery from COVID-19 curbs and shrinking exports that dented power consumption at manufacturers. read more

However, coal demand is showing signs of picking up as extremely hot weather across China boosts power demand for air conditioning.

Daily coal use at eight coastal provinces rose to 2.15 million tonnes last week, up 16% from the end of May, data analytics firm Wind said.

But analysts and market participants are not expecting coal demand to see significant improvement in the near term.

"The domestic economy remains in the recovery stage and power consumption growth from the industrial sector is limited. It's difficult for power plants to maintain high operation rates only based on high temperature," Zhang Yan, analyst from coal consultancy Sxcoal, said in a note.

Thursday's data also showed China's power generation was 688.6 billion kilowatt-hours (kWh) in May, up 5.6% from a year earlier.

In the January-May period, total power output was 3.42 trillion kWh, up 3.9% year-on-year.