It is reported that the China Iron and Steel Association (CISA) said China's steel companies refuse to accept the iron ore price cut reached between Rio Tinto and Japan's Nippon Steel Corp.

The price cut failed to reflect the real supply and demand situation on the international market and would lead to overall losses for Chinese steel companies, the CISA said in a statement on its website.

Rio Tinto on Tuesday announced it had agreed a price cut of between 33 percent and 44 percent with the Nippon Steel.

The CISA has insisted that the iron ore price should fall back to 2007 levels, which meant a price cut of more than 40 percent in the annual contracts of iron ore.