RIO DE JANEIRO – Vale SA is tapping into $5-billion in credit lines to boost its cash position as the coronavirus pandemic forces cutbacks at a time when the iron ore producer was working to recover from a dam collapse last year.

Vale asked banks to disburse the lines in two tranches, with $2-billion due in June 2022 and $3-billion due in December 2024, according to a statement filed to Brazil’s securities regulator. The company said the decision was made given the risk presented to its business by the pandemic, adding that it’s “prudent” to have more cash in hand “in the next few months.”

The global pandemic has prompted Vale to limit operations in Canada and Asia as governments struggle to contain the virus. Vale’s sales are expected to be reduced by 500 000 tons in the first quarter after the shutdown of a Malaysia terminal. The world’s largest iron ore miner is still recovering from a disastrous year in which the deadly dam disaster in January 2019 forced it to suspend operations accounting for about a fourth of its forecast output.

“Vale had been already beaten hard after two dam break disasters and is now trying to guarantee liquidity,” Adriano Pires, an analyst from consultancy firm CBIE, said by phone. “This is a liquidity crisis. From Vale to Petrobras to the bakery at the corner of my street, everyone will need to secure credit.”

The company’s shares rose 9% as of 10:18 a.m. in Sao Paulo, contributing most to the 6.5% advance of the benchmark Ibovespa gauge.

In Canada, the company’s copper concentrate output from its Voisey’s Bay project will be “reduced proportionally to the period of mine stoppage.” The halt at Voisey’s Bay will also affect an expansion project to convert the mine to underground operations, it said last week.

In Malaysia, the iron-ore producer is temporarily halting operations at a key terminal that serves as a conduit to China. The company has maintained its 2020 production and sales targets.

Vale also announced measures on Tuesday to support its suppliers during the crisis caused by the coronavirus. Those included advancing payments to small and medium-sized companies in Brazil before the invoices are due for services and materials delivered. The producer said it expects that more than 160 million reais ($31.5 million) will be disbursed with this moves.

Vale said it will provide financial support to construction companies and workers at projects being halted by the company.