Vale of Brazil, the world’s largest iron ore producer, on Friday said it would cut production by 30m tonnes a year, equal to more than 10 per cent of its total output in 2007, as a result of the slowdown in the global economy.

The move comes after experts have warned that, as iron ore supplies outpace consumption, miners face the prospect of the first price cut in seven years when they negotiate annual supply contracts with steelmakers.