A major Australian union is threatening strikes in the iron-ore rich Pilbara of Western Australia, targeting the world's biggest miner BHP Billiton, the West Australian paper said on Friday.

The report comes as Rio Tinto Ltd, the world's second-largest iron ore miner, faces a 12-hour strike on Saturday by train drivers at its Pilbara region operations who want to force their employer to negotiate a union deal.

The Australian Workers Union said it "strongly favours" strike action to force mining contractor Henry Walker Eltin (HWE) to reverse its opposition to a union deal for its workforce at BHP's key Yandi site.

"Basically, that only leaves two options for industrial agreements and both of them are non-union. Strike action is something that is high on our list of persuasive means," AWU Secretary Stephen Price told the West Australian newspaper.

The Yandi mine, which produced 40 million tonnes of iron ore last year, only resumed operations on Thursday after the death of a worker halted operations.

The mine, 500 kilometres from the western coast of Australia, is central to BHP's iron ore business, accounting for almost half of the 91 million tonnes of iron ore that BHP mined in Australia last year.

HWE refused to comment on the threat to Yandi.

Rio Tinto, which is subject of a multi-billion dollar hostile takeover bid from BHP, faces the first strike at its Australian iron ore mines since 1992.

Rio's Chief Executive Sam Walsh told staff in a memo this week that the Construction, Forestry, Mining and Energy Union was making unacceptable demands for drivers to be placed on driver-less trains at its Pilbara operations.

The traded market for iron ore is sensitive to any disruptions to supply amid a global shortage brought on by growing orders from Asian steel makers.

But China, highly dependent on Australian ore, is in a better position to weather disruptions than it was earlier this year, with some 60 million tonnes of ore -- roughly one month's consumption -- stockpiled in ports.

BHP is the world's third-largest supplier of iron ore, after Brazil's Vale and Rio Tinto Ltd/plc.