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The country produced an average of 2.31 million tpd, up 1.7% from 2.272 million tpd in May. In April, the country’s output averaged 2.295 million tpd.

China’s crude steel output totalled 69.29 million tonnes in June, up 4.5% year-on-year.

June’s production increase was within market expectations, as most Chinese mills managed to turn a profit over the past couple of months with iron ore prices sliding below $100 per tonne cfr from the second half of May.

Data released by the China Iron & Steel Assn (Cisa) also showed that its member mills’ output was also on the rise for most of last month, driven by improved profitability.

Although rising output could put downward pressure on steel prices, mills are not likely to cut production in the short term as they are still able to profit given the relatively cheap iron ore at the moment, market participants said.

"Under these circumstances, I'm not optimistic about the market outlook, although the country’s latest GDP data was relatively positive," a source at a mill in Hebei province told Steel First.

China’s GDP grew 7.5% during the second quarter of 2014, up from the 7.4% growth recorded in the first three months of the year. The latest figure, which is higher than a market consensus of 7.4%, reflects a steadying trend in the country’s economic growth, the NBS said when it released the figure on Wednesday.

China produced a total of 411.91 million tonnes of crude steel in the first half of this year, an increase of 3% on a yearly basis.

The country’s finished steel output reached 552.25 million tonnes over the same period, up 6.4% year-on-year, NBS data shows.