Mining magnate Gina Rinehart is urging the Australian government to cut red tape as the mining sector grapples with iron ore prices plummeting to a five-year low.

The steel-making ingredient has fallen nearly 40 per cent this year and many of Australia's miners are struggling to match the fall in price with cost cuts.

The government needs to act to help reduce the costs placed on Australian miners, who are reeling after iron ore prices plunged to a five-year low, the mining billionaire says. Credit:Bloomberg

Mrs Rinehart singled out red tape, approvals and burdens as addressable bureaucratic policies.

"Each one of these adds costs and makes it harder to compete successfully, risking Australian jobs and revenue," Mrs Rinehart told The Australian.