China's steel output surged in the first half of the year, but higher material costs had weighed upon profit of the sector, according to the China Iron and Steel Industry Association (CISA).
China's crude steel output came in at 492 million tonnes in H1 2019, up 9.9 percent year on year, CISA data showed.
The country in H1 saw its newly-added output of crude steel at 44.34 million tonnes, while net exports of steel suffered a 70,000-tonne decrease year on year, said the CISA.
According to the association, the majority of the newly-added output was pulled by the domestic market demand.
Total profit for CISA members stood at about 106.5 billion yuan (15.5 billion U.S. dollars) in the first half of the year, a marked year-on-year decrease of 20.5 percent.
Steel manufacturing cost in H1 had increased by 240 yuan per tonne, according to CISA, due to surging prices of imported iron ores, a key steelmaking raw material.
The association has warned about the rapid expansion of crude steel output without improvements in efficiency, which may trigger renewed oversupply in the sector.