China’s crude steel output hit a new record high in May as construction and manufacturing demand ramped up after Covid-19 lockdowns ended.

Crude steel output totalled 92.27mn t last month, up by 8.5pc from April and higher by 4.2pc from a year earlier, according to national bureau of statistics data.

Crude steel output on a t/d basis increased by 5pc to 2.976mn t/d from 2.834mn t/d in April.

Total production in January-May rose by 1.9pc from a year earlier to 411.75mn t, an annualised pace of 1.002bn t. May output equated to 1.086bn t/yr on an annualised basis.

Output had been expected to rise in May given strong domestic demand, widening profit margins and an influx of spot import orders for finished and semi-finished steel as the economy rapidly recovered from Covid-19.

Hot-rolled coil prices in Shanghai rose the fastest, gaining by 310 yuan/t ($44/t) to Yn3,600/t ex-warehouse over the course of May. Shanghai rebar prices rose by Yn100/t to Yn3,550/t ex-warehouse in the same period.

Pig iron output increased by 2.4pc from a year earlier to 72.32mn t in May, and was up by 7.3pc from April. January-May output up increased by 1.5pc to 355.99mn t.

Real estate sector investment fell by 0.3pc from a year earlier in the first five months of this year, narrowing from a 3.3pc drop in January-April. New project starts fell by 12.8pc in area terms in January-April, compared with a 18.4pc decline in the first four months of the year.

Real estate sales fell by 12.3pc in area terms, narrower than a 19.3pc drop in January-April.

More than 70pc of China’s steel is consumed in the construction and machinery sectors.

Infrastructure investment declines also narrowed, falling by 6.3pc in January-May compared with an 11.8pc drop in January-April.