China's largest rare earths producer, Baotou Steel Rare-Earth, said Wednesday it had suspended production for a month to try to stem falling prices for the elements.

China produces more than 95 percent of the world's rare earths, 17 elements crucial for making a range of hi-tech products.

The country's control over the sought-after resources -- through production caps and export quotas -- has sparked a dispute with major trading partners.

"The rare earth market has been sluggish in the second half of this year with prices trending lower in thin trade," Baotou said in a statement to the Shanghai Stock Exchange, where it is listed.

As a result, the company had from Tuesday suspended firing, smelting and separation of rare earths for a month to "promote steady and healthy development" of the domestic market, it said.

Domestic prices of rare earths have fallen this year as the global economic downturn hurt demand.

The price of praseodymium-neodymium oxide, a rare earths compound used for ceramics and magnetic materials, is now around 350,000 yuan ($55,556) per tonne, half the level of last October, the official Xinhua news agency said.

Weak prices have taken a toll on Baotou, which said earlier this month that its third-quarter net profit slumped 89.6 percent from the same period last year to 119.9 million yuan.

The company implemented a similar month-long production halt in October last year, but failed to reverse the downtrend in global and domestic prices of rare earths.

Baotou's shares closed down 2.96 percent at 31.46 yuan on Wednesday after the announcement.

Australia's Lynas Corp is hoping a new plant in Malaysia will help it break Chinese dominance of the market, though legal procedures have delayed the start of operations.