Count the diamond industry among those devastated by the COVID-19 outbreak.

Bloomberg reported that because of restrictions on travel and in person meetings, diamonds and gems worth billions of dollars have remained in storage for months. DeBeers and Alrosa are among the companies trying to figure out how to move some of the stockpile without undermining the nascent recovery.

Because of the pandemic, jewelry stores closed their doors, India’s cutting and polishing artisans were forced to stay home and De Beers had to cancel its March sale because buyers couldn’t travel to view the merchandise.

Alrosa said its diamond inventories could rise to 30 million carats by the end of the year

De Beers and Alrosa have moved to defend their market. The miners refused to cut prices, instead allowing buyers unprecedented freedom to renege on contracts to buy stones. They’ve also reduced production in an effort to control stock levels. Yet the diamonds keep piling up.

The five biggest producers are probably sitting on excess inventories worth about $3.5-billion, according to Gemdax, a specialist advisory firm. The figure could reach $4.5-billion by the end of the year, or about one-third of annual rough-diamond production.

“They’ve tried to restrict rough-diamond supply to protect the market and protect value,” said Gemdax partner Anish Aggarwal. “The question will be, how does this destocking occur? Can miners destock and keep protecting the market?”

While De Beers and Alrosa have stood firm on pricing – even refusing approaches from customers offering to buy at special terms – smaller diamond producers have dropped their own prices, according to people familiar with the matter.

Junior miners, some of which were fighting for survival even before the pandemic, have been offering steep discounts of as much as 25 percent in trading centers such as Antwerp, the people said. That could make it tough for the large companies to convince big buyers to come to the table.

Diamond miners face “a double whammy of weak prices and a sharp decline in sales volumes on a scale reminiscent of the 2008-09 crisis,” Societe Generale analyst Sergey Donskoy said this week.

Managing supply has been a constant headache for the diamond industry ever since De Beers ended its monopoly. The company spent the early 2000s running down about $5 billion in stock, and industry inventories ballooned during the global financial crisis and again in 2013. Each time, selling down the stockpiles has caused buildups of polished diamonds, putting huge pressure on the cutters, traders and manufacturers that buy from them.

There are some signs of recovery. Chinese retailers are open again and India has allowed manufacturing to restart in the key Surat polishing hub, albeit at only 50 percent of capacity. The main Indian trading offices are allowed 10 percent of employees on site.

Still, manufacturers bought heavily in the first two months of the year in anticipation of a recovery in the market. With cutting centers shut for the past two months, that inventory is expected to last until July or August. That’s left little need to buy now.

“At this stage it’s hard to speculate on what the recovery curve will look like,” said Aggarwal. “What we’re not expecting is an immediate jump back in consumer demand.”