NEW YORK (AP) â¿¿ Coal miners are expected to reduce production further this year as demand falls in the U.S. and Europe, a Dahlman Rose analyst said Monday.

Alpha Natural Resources Inc. and Patriot Coal Corp. have cut their forecasts for coal production and others will likely follow, analyst Daniel Scott said in a note to investors.

Scott said U.S. power companies are expected to rely even more on natural gas as prices hold near 10-year lows. And Europe appears to need less U.S. coal as its economy struggles through a deep financial crisis.

Scott said the production cuts are "necessary given current conditions." He kept his "Buy" rating and $29 price target for Alpha.

Alpha said Friday that it will curb annual production by 4 million tons "between now and early 2013" from its mines in Kentucky and West Virginia. The cuts include about 2.5 million tons of thermal coal and 1.5 million tons of lower quality metallurgical coal, used in making steel.

Alpha said it will try to relocate workers from the affected mines, but "approximately 320 employees at affiliated mining companies will be displaced within the next few weeks."

Patriot Coal cut its 2012 production estimate to between 27 million and 29 million tons, down from 31 million tons in 2011. The company said in January it was making the cuts "in response to weaker market demand."

Another major producer, Arch Coal Inc., is expected to report its fourth-quarter earnings on Friday. The St. Louis company hasn't announced any production cuts.

In morning trading, shares of Alpha Natural Resources rose 65 cents to $23.43. Patriot Coal rose 9 cents to $9.12 and Arch Coal 19 cents to $15.51.

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