A man talks on his phone near a new residential compound in Taiyuan, Shanxi province, May 11, 2014. REUTERS/Jon Woo/File Photo

SHANGHAI (Reuters) - Nearly a third of the surface water in Shanxi, China’s biggest coal producing province, is so polluted that it cannot be used by humans, the local environmental watchdog said in a notice on Wednesday.

The Shanxi Environmental Protection Bureau said in a report that 29 out of the 100 surface water sites tested in the first three quarters of 2016 were found to be “below grade five”, which means that pollution levels are so high that the water has “lost functionality”.

China’s water is graded into five categories. Grade three and above is deemed safe for direct human contact, while grades four and five can only be used in industry and agriculture.

While there have been slight improvements compared to the first half of the year, Shanxi is still falling behind its targets, the bureau said.

It said 11 sites had shown improvements compared to last year, but eight had deteriorated, including five spots in the major coal-producing city of Datong, which were found to have fallen “below grade five” over the period.

According to the Ministry of Environmental Protection’s latest analysis of water quality on major rivers published this week, 22 percent of samples from 146 sites nationwide was found to be grade four or worse.

Shanxi produced 944 million tonnes of coal last year, more than a quarter of the national total, and decades of overmining in the province have damaged underground water tables and contaminated ground water supplies.