Two more people have died from a new strain of bird flu in China, bringing the death toll to 16 as authorities struggle to find the source of the outbreak.

The majority of the 77 people infected by the H7N9 virus, including the latest victims, have come from Shanghai or nearby.

What is baffling scientists is that only a small proportion of them appear to have had direct contact with poultry.

The exact source of infection remains unknown and no human-to-human spread of the virus has been confirmed.

But with infections also found in Beijing and Henan, officials are warning the H7N9 death toll could rise.

Thousands of chickens have been slaughtered and some poultry markets closed in an attempt to slow the spread of the virus.

The panic over bird flu has also caused many Chinese to shun eating chicken for fear of catching the virus.

China's poultry sector has recorded losses of more than 10 billion yuan ($1.6 billion) since reports emerged of the new strain two weeks ago.

An international team of flu experts will arrive in China this week to assist with investigations.

ABC/Reuters