China's producer prices continued to fall in July but the decline has kept narrowing as economic activities recovered amid effective epidemic control in the country, official data showed Monday.

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The trade volume from January to May totaled 172 billion yuan ($24.3 billion), an increase of 21.1 percent over the same period last year.

Oversupply concerns weigh heavily on the steel sector in China as some 80 million metric tons of fresh capacity will hit the market this year amid dwindling demand due to the COVID-19 epidemic, an industry expert said.

Rail freight of coal and ore also posted robust year-on-year growth in the first half of this year in Xinjiang.

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China iron and steel association (Cisa) member mills increased steel output to a record high in late July as stimulus and lockdown delays extended the construction season into late summer.