A Saudi-led coalition air strike killed 29 people at a crowded marketplace in the heartland of the Iran-backed Shiite Huthi rebels in northern Yemen on Wednesday, Huthi health authorities said.

The coalition, which has faced repeated international criticism over civilian casualties, said it was investigating the reports without claiming responsibility for the attack in Saada governorate.

Residents at the scene picked through the remnants of stalls, some still smouldering, reduced to spindly metal frames and scattered wreckage, AFP photos showed.

The charred bodies of the victims, many of their faces disfigured beyond recognition, were laid on white body bags for families to identify in the courtyard of a hospital morgue.

The health service said 29 people were killed and 17 others wounded, while the Huthi-run Saba news agency gave a lower toll of 21 dead, all of them civilians.

Saba accused the Saudi-led coalition of carrying out the raid in the Sahar district.

The alliance enforces an air blockade on rebel-held territory and is the only force whose warplanes are known to operate in Yemen's north along the Saudi border.

The United Nations blacklisted the coalition in October for killing and maiming children, drawing fresh calls from rights groups to step up pressure on Riyadh over the conflict.

The coalition was briefly included on the annual list of shame last year before a threat by Saudi Arabia to cut off its funding to UN programmes forced a reversal.

Human rights groups have urged governments backing the coalition, including the United States, Britain and France, to suspend all weapons sales to the Gulf monarchy.

- Iran, Saudi tensions -

The war pits forces loyal to the internationally recognised government of President Abedrabbo Mansour Hadi, which was expelled from the capital Sanaa in September 2014, against the Huthi rebels who drove them out and continue to control swathes of northern Yemen.

The conflict intensified in March 2015, when the Saudi-led coalition joined the government's fight against the rebels.

Tehran on Monday rejected as "ridiculous and baseless" accusations by Saudi Arabia that Iran is providing military support to the rebels and blocking peace efforts in Yemen.

Saudi Arabia's top diplomat had accused Tehran of smuggling arms to the Huthis and to their allies.

In a statement on Wednesday Iran "vigorously condemned" the attack on the market.

"By killing innocent Yemenis and by committing such violent acts Saudi Arabia is looking to compensate for its political failures and failures on the ground," foreign ministry spokesman Bahram Ghassemi said.

Multiple rounds of UN-sponsored talks have failed to broker a political settlement between the Saudi-backed Hadi government and the rebels.

The war has left more than 8,600 people dead since the Saudi-led coalition intervened in 2015.

A cholera outbreak in the impoverished country has claimed more than 2,100 lives since April, as hospitals struggle to secure supplies amid the air and sea blockade.

The United Nations has warned Yemen now stands on the brink of famine.

The UN Human Rights Council in September agreed to send a group of experts to investigate alleged violations and abuses in Yemen, overcoming strong resistance by Riyadh's representative.

Source:AFP