The two companies said they were working towards feasibility studies for an iron ore briquetting plant in Brazil and for plants "to produce metallic products with low carbon footprint, using Tecnored, HYL [a low carbon iron ore direct-reduction technology developed by Ternium in Mexico] and other technologies for iron reduction".
Vale said the use of briquettes "would support the continued adoption of blast furnaces in its transition to a less carbon-intensive process, since it could bypass the sintering process, which represents around 10% of steelmaking emissions, or be used as direct charge since it could replace lumps and pellets in blast furnaces and direct reduction furnaces".
Vale is aiming to reduce Scope 1 and 2 emissions by a third by 2030, and has targeted a 15% reduction in Scope 3 emissions by 2035.
Earlier this year Vale invested US$6 million in Boston Metal, a US-based start-up founded by professors from MIT to develop steel decarbonisation technologies.
Vale is not alone among the mining majors in its quest to reduce emissions from the steelmaking process.
Rio Tinto has signed MOUs with three of Asia's largest steel producers: South Korea's Posco, China Baowu Steel Group - the world's top steel producer - and Japan's Nippon Steel Corporation.
BHP signed a five-year MOU with China's Baowu in November along similar lines to Rio's partnerships.