China’s steel output rebounded in October, snapping a four-month losing streak, as market sentiment improved on Beijing’s efforts to stimulate economic growth.

Improved profit margins helped steelmakers increase output to 81.88 million tonnes, up 6.2% from September and 2.9% higher than a year earlier, according to data from the National Bureau of Statistics. The cumulative decline in output in the first 10 months of the year compared with 2023 narrowed to 3%.

While many mills are still facing losses and a slowdown in the property sector continues to weigh on demand, analysts have noted a recovery in demand driven by increased industrial demand, state-backed construction activity and rising exports. Still, the long-term outlook for the steel industry remains bleak.

The country’s leading steel association last month urged mills to maintain production discipline, warning that the recent price rebound did not reflect a significant improvement in underlying economic conditions. While the government is signaling its readiness to provide more stimulus over the coming year, future measures may not be enough to revive traditional sources of demand in the market, such as new housing projects and large steel-intensive infrastructure.