China has banned one of Australia's largest export commodities, putting a halt on BHP iron ore cargoes amid a deepening pricing dispute.

State-run iron ore trader China Mineral Resources Group (CMRG) urged local mills to temporarily pause purchases of any dollar-denominated seaborne iron ore cargoes from BHP, reports Bloomberg News .

The move comes as contract talks between the Australian miner and Chinese buyers stall.

CMRG was created to bolster China's influence in the global iron ore market, and this move further highlights Beijing's determination to gain greater sway over prices.

Iron ore is a key ingredient in steel production, and Chinese demand for it has been instrumental in Australia's economic prosperity, accounting for up to 5 per cent of the country's gross domestic

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