WA Premier Colin Barnett says the big players in Australian iron ore have adopted a “dumb” strategy.

With the iron ore price hitting new lows nearly every week, Mr Barnett has criticised the approach of Rio, BHP and Brazilian company Vale.

“I must say the big iron ore producers have got this dramatically wrong,” he said on ABC radio.

“The two big ones in Western Australia and the Brazilians have been putting too much iron ore into the market and they've precipitated a continuing downward trend in iron ore prices.

“This has been one of the dumbest corporate plays I think I've ever seen,” he said.

Mr Barnett even said the companies may have charged Chinese buyers exorbitant prices at the peak of the mining boom.

“That was offensive to the Chinese and there's a bit of payback going on at the moment,” he said.

“The state and the people of Western Australia are bearing the cost.”

Opposition Leader Mark McGowan said the Premier was dodging the blame.

“What's he going on about? Why is he attacking the two biggest employers in Western Australia? Why is he attacking the iron ore industry?” McGowan asked

“The Premier's budget problems are because of him.

“He's the one who's created the debt. He's the one who's created the deficit, the first one in 15 years. No-one else.”