Steel prices in China are showing signs of recovering as market demand picked up in April, but continued excessive supply in the industry will keep a lid on price rises in the long run, the latest data from an industry association showed.

The steel price index released by the China Iron and Steel Association (CISA) came in at 112.84 by the end of last month, up 3.84 percent from a month earlier.

The index marked a rise of 21.8 percent from a year ago, as demand from industries such as equipment and auto manufacturing gained steam, according to the association.

Amid the rising demand, steel output is also on the rise. Official data showed China's crude steel output went up 4.8 percent year-on-year to 76.7 million tons in April.

However, the CISA predicted that the price rise will not be sustained as supply still exceeds demand in the industry.

Meanwhile, uncertainties in downstream demand, especially a slowdown in property and infrastructure investment, along with the impacts of trade frictions, will combine to put downward pressures on prices, the association said.

China plans to cut ineffective iron and steel capacity by 30 million tons in 2018, according to a government work report released earlier this year.