The Chinese government's top steel-industry forecaster has disputed Rio Tinto's bullish claim that China will hit 1 billion tonnes of crude steel production by 2030, arguing slowing demand from infrastructure projects will pare the rate of growth.

Rio, Australia's largest producer of iron ore, which is used to make steel, told investors at its first-half results the miner was "holding" to its internal forecast that steel output would reach 1 billion tonnes by 2030, despite growth moderating in the past 18 months.

"Let me assure you that our economics department has come under great focus, thanks to all your articles and those of the press and what have you," Rio chief executive Sam Walsh said on Thursday in response to a question from Morgan Stanley analyst Menno Sanderse.

"They're holding the line. They've done quite a bit of research and analysis and they feel confident that that 1 billion-tonne figure will continue to hold. To achieve 1 billion tonnes of crude steel production by 2030, that's 1 per cent growth a year. I think we'll be all right there."

However, Li Xinchuang, president of the China Metallurgical Industry Planning Association, told Fairfax Media he saw no evidence to back up Rio's bullish claims, which rival BHP Billiton shares.

He argued that with China passing peak steel demand in 2014, steel production would struggle to lift much higher than 800 million tonnes a year in the next few decades, given the slowdown in property and infrastructure-led growth.

"You are seeing demand decline gradually, so it simply cannot reach that 1 billion-tonne level which Rio is talking about," Mr Li said. "I do not understand why Rio is so confident about reaching that level because we are not seeing that level of optimism here on the ground in China."

Steel consumption dropped

Mr Li, whose forecasts are used by the government to help formulate its five-year plans, said domestic steel consumption dropped by 4 per cent over the first half of 2015.

Overall steel output is tracking at just more than 820 million tonnes a year, which Mr Li expects to fall by about 2 per cent to about 800 million tonnes a year for 2015.

"Looking longer term, we expect demand to remain solid but it will not accelerate at the level Rio is proposing," Mr Li said.

The price of iron ore delivered to China fell by 46 per cent in the first half of 2015 compared with a year earlier.

It reached a six-year low of $US44.59 a tonne on July 9 and on Friday was trading at $US56.40 a tonne. Earnings from Rio's iron ore division, which accounts for 85 per cent of its earnings, fell 55 per cent to $US2.1 billion ($2.83 billion) from $US4.6 billion for the same period in 2014.

In May Mr Li said the organisation's understanding of the buyer side of the market meant it was forecasting iron ore prices to remain within a $US55 to $US65 a tonne range for at least two years.

Despite the fall in iron ore prices Rio continues to make strong returns from the commodity, with the miner digging up iron ore at just $US15 a tonne.

That means Rio is poised to approve construction of the Silvergrass mine in the Pilbara in 2016, as it works to reach its target export capacity of 360 million tonnes a year.

Mr Walsh admitted the market was still trying to decipher the implications of Chinese President Xi Jinping's description of slower economic growth as the "new normal".

"I think, importantly, it's a journey rather than necessarily an end point, and it's recognising the fact that post the global financial crisis the market dynamics have actually changed," Mr Walsh said. "If you thought that the industry goes through cycles and you return to where you came from, I think the new normal is actually signifying that the return probably won't be to the point that you left before prices started declining."