China’s crude steel output rose 12.9% in the first two months of 2021 compared with a year earlier, as steel mills increased production in expectation of more robust demand from the construction and manufacturing sectors.

China produced 174.99 million tonnes of crude steel in January and February, National Bureau of Statistics (NBS) data showed on Monday. The bureau combined data for the first two months of the year to account for the distortions of the week-long Lunar New Year holiday.

China’s mammoth steel market has expected construction and fast-recovering manufacturing to support consumption this year.

Investment in China’s infrastructure projects and real estate market surged 36.6% and 38.3%, respectively, in the first two months, the NBS said in a separate statement on Monday.

And China’s manufacturing sector investment picked up rapidly after being hit by the coronavirus pandemic to soar 37.3% in Jan-Feb from the same months in 2020.

However, the government has vowed to cut output to reduce carbon emissions from steel producers, which, at 15% of the country’s total, is the biggest contributor among manufacturers.

Top steelmaking city Tangshan pledged on Sunday to ensure 50% emission cuts during heavily polluted days and punish those who violate regulations, after the environment ministry found four steel mills had failed to implement output curbs during heavy pollution.

Worries about steel output curbs have hurt benchmark iron ore futures on the Dalian Commodity Exchange, with those for May delivery sliding 5% since March 11.