China's Hebei Iron and Steel Group Company has signed an agreement to take a 51 per cent stake in Switzerland-based Duferco International Trading Holding, in a move aimed at boosting the state-owned conglomerate's ability to sell steel overseas.

The deal was signed in Beijing on Tuesday, according to a report by state-controlled China News Service.

It puts China's largest steel-making group in control of a European trading firm -- the world's largest in steel -- underlining the dominance of China in the steel market.

China is the world's largest producer and consumer of the alloy.

Along with their peers around the world, Chinese steelmakers have been battling weak steel prices in an oversupplied market since the 2008 financial crisis and have tried to export more to take advantage of their competitive production costs.

However, their reputation as less reliable business partners than their western counterparties have limited their ability to expand their sales network.

"Hebei Iron and Steel will fully utilise Duferco's international reputation, management and experience to improve our efficiency and competitiveness in international markets," Hebei chairman Yu Yong said, according to the report.

State media said in September the transaction would be valued at about $400 million. Duferco and Hebei could not be reached immediately for comment.

Duferco International Trading Holding is the trading branch of Duferco Group, the steel business empire created by Italian entrepreneur Bruno Bolfo. - Reuters