London-based company, Rio Tinto Group has decided to reduce ore production by 10 per cent following decline in demand by Chinese steel makers and competition from Cia Vales do Rio Doce.

Rio Tinto Group is the second largest ore exporters in the world and is a prominent company working in mines of west Australia. Shipments from Rio's mines would be between 170-175 million metric tons by December end. It produced 145 million tons of ore from its Pilbara mines of West Australia last year.
 
The chief executive of company, Tom Albanese said it registered low demand of ore for the fourth- quarter. It would go for more production after revising demand in the market. Many countries have reduced steel demand and cut its exports in the wake of global recession. He, however, expressed hope that situation would become normal within a year.
 
Australia's third-largest iron ore exporter, Fortescue Metals Group Ltd has also decided to cut production by 10 percent due to low demand. Other leading companies are also reviewing their investment plans and rescheduling their production strategy.

Meanwhile, Daiwa Securities Group Inc. forecasted 5 per cent increase in steel demand in China in the coming year.