UPDATE 1-U.S. natgas output, demand to fall in 2020, 2021 due to coronavirus

(Adds natural gas, coal and carbon emissions data)

July 7 (Reuters) - U.S. natural gas production and demand will drop in 2020 and 2021 from record highs last year as government steps to slow the spread of coronavirus cut economic activity and energy prices, the U.S. Energy Information Administration (EIA) said in its Short Term Energy Outlook (STEO) on Tuesday.

The EIA projected dry gas production will drop to 89.24 billion cubic feet per day (bcfd) in 2020 and 84.23 bcfd in 2021 from the all-time high of 92.21 bcfd in 2019.

It also projected gas consumption would fall to 82.35 bcfd in 2020 and 78.62 bcfd in 2021, from a record 84.97 bcfd in 2019.

That would be the first annual decline in consumption since 2017 and the first time demand falls for two consecutive years since 2006.

The EIA’s gas supply projection for 2020 in July was lower than its June forecast of 89.65 bcfd, while its latest demand outlook for 2020 was higher than its June forecast of 81.87 bcfd.

The agency forecast U.S. liquefied natural gas exports would reach 5.35 bcfd in 2020 and 7.28 bcfd in 2021, up from a record 4.98 bcfd in 2019. That is lower than its June forecasts of 5.70 bcfd in 2020 and 7.31 bcfd in 2021.

U.S. coal production is expected to fall 29% to 501 million short tons in 2020, which would be its lowest since 1967, before rising to 536 million short tons in 2021 when power plants are expected to burn more coal due to a forecast increase in gas prices, EIA said.

It projected carbon emissions from burning fossil fuels will fall to 4.507 billion tonnes in 2020, the lowest since 1983, from 5.130 billion tonnes in 2019, the lowest since 1992, before rising to 4.775 billion tonnes in 2021 as coal use increases. (Reporting by Scott DiSavino Editing by Chizu Nomiyama and Marguerita Choy)