CHINA'S industrial profit growth slowed in May as base effects from last year eased and businesses faced rising costs.

       Industrial profits rose 36.4% in May from a year earlier, the National Bureau of Statistics said Sunday, compared with a 57% increase in the previous month. In the first five months of the year, profits climbed 83.4% from a year earlier.

       The steady recovery of market demand and continuous improvement of industrial companies’ operation have contributed to the sustained growth in profits, Zhu Hong, an economist with the statistics bureau, said in a statement. Yet the recovery is still unbalanced with smaller companies registering a slower pace than large and medium-sized enterprises, Zhu said.

       Rising commodity prices have boosted profits for upstream industries such as raw material producers, but put a squeeze on downstream businesses as input costs climbed. Producer prices rose 9% in May from a year earlier, the fastest pace since 2008, mainly due to higher metal prices.

       Profit growth in mining in the five-month period remained strong at 136%, while manufacturing posted gains of 85.2%. - Bloomberg