Billions of dollars of unsold diamonds are piling up around the world because no one wants to buy jewels in the middle of a pandemic

• Diamond miners are reportedly stuck with billions of dollars worth of gems as the coronavirus pandemic has left very few people around the world wanting to buy the precious stones, Bloomberg reports.
• The five biggest diamond producers in the world are reportedly stuck with piles of inventories worth about $3.5 billion.
• London-based De Beers, the biggest name in the industry, held a sale in May and sold about $35 million of stones. At a similar sale last year, it brought in $416 million.
• Miners in the industry face "a double whammy of weak prices and a sharp decline in sales volumes on a scale reminiscent of the 2008-09 crisis," a Societe Generale analyst told Bloomberg.
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Diamond miners are reportedly stuck with billions of dollars worth of gems as the coronavirus pandemic has left very few people around the world wanting to buy the precious stones.

The five largest diamond producers have perhaps stockpiled "excess inventories" of about $3.5 billion and could touch $4.5 billion, or one-third of yearly production, by the end of 2020, according to Bloomberg, which cited specialist gem consultancy Gemdax.

Demand has plummeted, and De Beers, a name synonymous with the trade, has seen sales fall sharply. Bloomberg reports that at a May diamond sale it made around $35 million. At a similar event last year, it bought in over $400 million in sales, the report said.

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Owing to lockdown restrictions across the world, most jewelry stores have had to shut down, meaning that a key avenue of diamond sales has been shut. Bloomberg also reported that India's gemstones craftsmen are out of work as they stay home to avoid contracting the virus.

Smaller diamond producers have reduced their own prices. De Beers, a unit of mining group Anglo American, and its Russian competitor Alrosa have reportedly rejected price cuts and would rather allow buyers to pull out of previous contracts.

While miners have attempted to cut production, stockpiles keep growing as production isn't being fully halted.

What could be a challenge to dominant miners is that the smaller ones have been offering substantial discounts of as much as 25% in diamond trading centres like Antwerp in Belgium, Bloomberg said, citing sources.

Earlier this week, investing website Proactive reported that BlueRock Diamonds, a UK-listed diamond miner, sold around $700,000 worth of stones at an auction. It estimated thay was around 15% less than it would have gotten for the same amount of diamonds prior to the pandemic, the report said.

Diamond miners are faced with "a double whammy of weak prices and a sharp decline in sales volumes on a scale reminiscent of the 2008-09 crisis," a Societe Generale analyst Sergey Donskoy told Bloomberg.

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