Rio Tinto (NYSE:RIO) will have to look further afield after another potential bidder for its Iron Ore Company of Canada (IOC) operation on Wednesday said it is not in the running any more.

Wall Street Journal Online (paywall) reports China's Wuhan Iron & Steel (Group) Corp according to sources familiar with the matter, will not be bidding for IOC, following another Chinese giant Minmetals from the negotiating table:

"Rio Tinto now will consider whether it should lower the price of the asset or put on hold the sales process for a deal that would have been the largest in the global mining sector in about a year, one of these people said."

Rio Tinto is said to be asking in the $3.5 billion to $4 billion range and has been shopping IOC since early last year. "Interest has all but fizzled," WSJ Online quotes its sources.

Wuhan Iron & Steel, based in the Hubei province, is China's third largest steel producer. The state-owned giant interest in Canada's iron ore belt extends beyond IOC with equity investments in Century Iron Mines (TSE:FER), a billion tonne resource company advancing a number of projects in the Labrador Trough.

In October last year Beijing-based Minmetals and Canada's Teck Resources, reportedly also put off by the rich valuation, also lost interest in 18 million tonnes a year IOC, which is 59% owned by Rio.

Private equity firms Apollo and Blackstone and Glencore dropped out of the bidding process for the Newfoundland/Labrador-based unit early on, but Glencore may now take a fresh look at a bid WSJ Online speculates.

Benchmark import price of 62% iron ore fines at China's Tianjin port was trading $123.50 a tonne on Wednesday, down 8% so far in 2014, according to data provided by SteelIndex.