UPDATE 1-Australia minister says still hopes for China Rio talks

Australian Foreign Minister Stephen Smith said on Wednesday he still hoped to meet his Chinese counterpart to discuss Rio Tinto's detained employees after Beijing officials said no meeting was planned.

Smith, speaking to reporters on the sidelines of a regional security meeting in the Thai resort of Phuket, added that it would take more than just a meeting to solve the problem.

Chinese authorities this month detained four employees of Rio Tinto (RIO.L) (RIO.AX), including its top iron ore salesman in China, Australian Stern Hu, alleging they were involved in stealing state secrets.

"The Stern Hu matter is not a matter which is going to be solved, which is going to be addressed, by ministers meeting each other," Smith said.

"It's not going to be solved by one phone call, one meeting, as I've seen people suggest."

A Chinese diplomatic source told Reuters on Wednesday there were no plans for China's Foreign Minister Yang Jiechi to hold talks with Smith during the Phuket meetings, which ends on Thursday.

The case has strained ties between the two countries, with Australian officials frustrated by China's slow pace in dealing with the issue and its reluctance to provide full details of any charges.

Rio has refuted claims that its employees had bribed Chinese steel mills.

China is Australia's biggest trade partner, with trade worth $53 billion last year. Iron ore exports accounted for $14 billion of that figure, led by Rio Tinto and BHP Billiton Ltd (BHP.AX) (BLT.L).

Smith said Hu was under investigation and could be charged, adding that he expected the process "will take some time".

He said the two governments would continue to discuss the issue behind the scenes, regardless of whether the ministers were able to meet this week.

"This is not a case, a matter, where it lurches from ministerial meetings to ministerial meetings," link.....