Dock workers are handling the iron ore import from overseas in Qingdao Port. [CFP]

Eight government departments led by the Ministry of Commerce will jointly investigate the quality of imported iron ore stored at major Chinese ports, according to a source familiar with the matter.

Chinese steel mills and iron ore traders had recently told the government that some of the imported ore was adulterated and urged more regulation of the iron ore market, amid soaring prices and surging domestic demand, the source said.

The eight departments include the Ministry of Commerce, the National Development and Reform Commission, the Ministry of Industry and Information Technology and the Ministry of Transport.

The other agencies are the General Administration of Quality Supervision, Inspection and Quarantine, the General Administration of the Customs, China Iron and Steel Association (CISA) and China Chamber of Commerce of Metals, Minerals & Chemicals Importers & Exporters, said the source.

However, the source did not clarify the origins of the iron ore being investigated.

The investigation comes as the 2010-11 iron ore negotiations are expected to reach a consensus on the benchmark price by April 1. It is also against the backdrop of the ongoing investigation against four Rio Tinto employees who are being probed for bribery.

Xu Xiangchun, chief analyst of consulting company Mysteel.com, said steel mills should ask for compensation if the investigation proves that the imported iron ore is of low quality.