Baosteel, which negotiated on behalf of China's steel industry, agreed to a 79.88 percent price hike for Pilbara blend fines and Yandicoogina fines and a 96.5 percent price rise for Pilbara Blend Lump for the contract year starting on April 1.
Prices will be 144.66 U.S. cents for per dry metric tonne unit of Pilbara blend fines and Yandicoogina fines and 201.69 U.S. cents for per dry metric tonne unit of Pilbara blend lump.
Baosteel and Rio Tinco, the world's third largest iron ore producer, agreed on the price hike after talks that "maintained traditional pricing mechanism and normal market order, and kept the long-term friendly cooperation between the upstream and downstream sectors", the China steel giant said in a statement.
The agreement represented the sincerity from the two sides to maintain the traditional pricing mechanism and was a result of the joint efforts of the responsible businesses, according to the statement.
"Chinese steel firms will support Rio Tinto to increase investment and output to meet market demand," Baosteel said.
Baosteel agreed as early as in February on a 65 percent price rise for iron ore imports from Brazilian miner Vale, the world's largest.
Rio Tinto and larger rival BHP Billiton have then required for a "freight premium", claiming that it costs less to ship iron ore from Australia to China.
Chinese steel makers have accepted huge price rises for six consecutive years, driven up by huge increases in demand.
China imported 1.34 billion tons of iron ore between 2003 and 2007, 42 percent of the total world shipments in the five years.
The country's crude steel output more than doubled to 490 million tons in 2007 from 220 million tons in 2003.