South Korea's producer prices declined on-year for the tenth straight month in May in tandem with lower oil prices, data showed Friday.

The producer price index, a barometer of future consumer inflation, reached 101.87 in May, falling 3.5 percent from a year earlier, according to the preliminary data from the Bank of Korea.

The May reading gained 0.1 percent from a revised 101.76 in April.

The on-year fall was attributed to weak oil prices.

Prices of coal and petroleum products slumped 28.8 percent from the previous year, slowing from a 33.5 percent drop in April.

The index that covers agricultural goods, meanwhile, jumped 6.6 percent on-year, sharply gaining from a 1.1 percent increase in the previous month.

"A drop in rainfall and the ongoing drought led to a fall in the production volume of vegetables," explained a central bank official.

The data comes as low consumer price growth is fueling concerns of possible deflation in Asia's fourth-largest economy.

The country's consumer price index inched up 0.5 percent on-year in May, growing less than 1 percent for the sixth month in a row, according to separate data by Statistics Korea. (Yonhap)