Reuters citing an executive of the China Iron and Steel Association as saying that, Chinese steel mills oppose BHP Billiton Ltd's takeover bid for Rio Tinto.

Mr Luo Bingsheng vice chairman of the association's said that "We should maintain the principles of fair trade and oppose a monopoly market which would have a negative impact on consumers. He said that the steel industry's concerns about the increased pricing power of a combined company.”

Mr Luo said that "We already have three companies monopolizing the market. If it becomes two companies and a more monopolistic market, it would be easier for them to control the market and prices, and that would have more of a negative impact on consumers."

Analysts said a combined group would control about 35% of the global seaborne traded iron ore market, while BHP uses a different calculation, putting the share at 27% of the world's contestable iron ore market.