Kiran Gems, recognized as the world’s largest producer of natural polished diamonds, is implementing a 10-day production pause to address an inventory imbalance in the Indian market. According to Dinesh Lakhani, global director speaking to Rapaport News, all cutting operations will cease from August 18 to 27.
The decision aims to align production levels with current demand-supply dynamics. Weak demand from China and variable conditions in the US have contributed to an oversupply of polished diamonds in India’s midstream sector. Consequently, manufacturers are scaling back production, while rough diamond sales by miners are being constrained.
Petra Diamonds recently deferred a planned tender of South African mined goods scheduled for August and September, while De Beers has enhanced flexibility in its July sight. August typically sees reduced activity due to India’s Independence Day on August 15 and other holidays, during which workers typically take around five days off.
Regarding compensation for the extended vacation, decisions are made locally at Kiran Gems’ manufacturing departments in Surat, separate from its Mumbai headquarters. Kiran Gems has already halved production year-on-year for July and August, focusing particularly on diamonds under 0.18 carats, which currently exhibit stronger market movement.
Despite ongoing demand, Lakhani acknowledged a decline compared to the previous year, attributing this trend to historical patterns of sluggish activity during these months. By adjusting production to match demand levels, the industry aims to achieve more balanced inventory levels in the coming months.
Kiran Gems, employing over 50,000 individuals across its Mumbai marketing office and Surat manufacturing facility, remains pivotal in the global diamond manufacturing landscape.
