Vale has signed an MoU with Korean steel firm POSCO to jointly work on decarbonisation initiatives to reduce carbon emissions.

The companies are discussing how to use Vale's products, such as pellets and briquettes, to curb emissions.

POSCO and Vale have committed to achieving carbon neutrality by 2050.

"Steel and mining industry are already under transformation to develop low-carbon solutions, and we are happy to be with POSCO on this journey," Vale iron ore executive Marco Spinelli said during the virtual signing ceremony. Vale is well-equipped to meet the challenge given its portfolio and technologies, he said.

POSCO steel executive Hagdong Kim extolled the virtues of working with another company to meet these carbon aims.

"Instead of trying alone, if we work together, we will create more synergy."

POSCO has committed to reduce greenhouse gas emissions by 20% in 2030, and by 50% by 2040.

The agreement comes on the heels of the COP26 climate conference in Glasgow, where world leaders advanced several new initiatives to address the world's growing carbon emissions problems.

Steel production is responsible for around 8% of global carbon dioxide emissions, according to the World Steel Association.