(Reuters) - Prices in China for commodities such as iron ore, steel rebar, coal and copper have surged to record highs this month prompting the government to step in to curb “unreasonable” cost increases for consumers. WHAT HAVE COMMODITY PRICES DONE? As the world’s factory floor and largest construction market, China has been the main driver of global metal markets for more than a decade. From the start of the year through mid-May, prices for China’s steel rebar, hot-rolled steel coil and copper - vital for the construction of machinery, buildings, appliances and vehicles - surged more than 30% as a revival in construction and manufacturing supercharged demand in the world’s largest metal consumer. (Graphic: China’s industrial metals get walloped after Beijing says it will step up market management: ) A slew of other vital industrial inputs - including iron ore, thermal coal, sulphuric acid and glass also notched up double-digit gains on the way to record highs as overall consumption growth outpaced supply. WHAT IS HAPPENING WITH CHINA’S ECONOMY? China’s economic recovery quickened sharply in the first quarter from a coronavirus-induced slump earlier last year, with gross domestic product (GDP) jumping a record 18.3%. (Graphic: China’s GDP expanded by a record 18.3% in the first quarter of 2021 in a post-pandemic revival: ) The government’s aggressive stimulus measures launched at the height of a COVID-19 lockdown last year helped revive construction activity, while the world’s largest manufacturing base capitalized on booming demand for appliances, exercise equipment and machinery across the locked-down world from mid-2020. China has also moved to cut emissions via the shuttering of outdated smokestack plants, which has further supported metal prices. Output of metals from steel to copper and aluminium is up solidly year on year as refiners, smelters and fabricators churn out intermediate metals goods used by manufacturers. WHAT IS THE GOVERNMENT DOING NOW? With soaring raw material prices sparking fears of inflation, the government has urged coal producers to boost output while vowing to investigate behaviour that bids up prices. The national cabinet pledged to step up its management of commodity supply and demand, including stockpiling and reinforcing inspections on both the spot and futures markets. Regulators in Shanghai and the steel hub of Tangshan also warned mills this month against price gouging, collusion and irregularities, and said they would shut the businesses of those seriously disrupting market orders. HOW HAS IT AFFECTED GLOBAL MARKETS? Australia has been a big beneficiary of China’s strong metal demand, with record iron ore exports cushioning its economy despite trade tension with China in other sectors. Yet China’s aggressive buying spree has left overall ore and metal supplies in other regions relatively tight, with copper stocks on the London Metal Exchange and on the CME hovering not far off multi-year lows. (Graphic: LME copper inventories: ) If China’s efforts to crack down on speculators unleashes a wave of metal selling that curbs its import demand, that will make it easier for other metal buyers to secure supplies over the near term. But analysts say that China’s overall appetite for metal looks set to stay strong as long as its economy grows. Writing by Gavin Maguire and Lincoln Feast; Editing by Robert Birsel Our Standards: The Thomson Reuters Trust Principles.