China and iron ore suppliers have suspended negotiations to finalise supply prices, according to a Rio Tinto executive.

Discussions for the supply year that commenced 1 July have stalled over how much prices should be dropped after two years of steep hikes, reports.

Rio’s iron ore business chief executive Sam Walsh said that no negotiations were being carried out but that he expected them to resume at a later date.

China is pressurising for up to 40% price reductions after major suppliers agreed cuts of 33% with Korean and Japanese steel mills this year.

Walsh said that China-based mills are acquiring iron ore at rates based on the benchmark established in negotiations with other customers this year, reports.