diff --git a/app/controllers/admin/dfc_product_imports_controller.rb b/app/controllers/admin/dfc_product_imports_controller.rb
index 30964fa313..69e08280c0 100644
--- a/app/controllers/admin/dfc_product_imports_controller.rb
+++ b/app/controllers/admin/dfc_product_imports_controller.rb
@@ -88,14 +88,23 @@ module Admin
 
     # Reset stock for any variants that were removed from the catalog.
     #
-    # When variants are removed from the remote catalog, there not for sale
-    # anymore. We prevent them from being sold by reseting stock to zero.
+    # When variants are removed from the remote catalog, we can't place
+    # backorders for them anymore. If our copy of the product has limited
+    # stock then we need to set the stock to zero to prevent any more sales.
+    #
+    # But if our product is on-demand/backorderable then our stock level is
+    # a representation of remaining local stock. We then need to limit sales
+    # to this local stock and set on-demand to false.
+    #
     # We don't delete the variant because it may come back at a later time and
     # we don't want to lose the connection to previous orders.
     def reset_absent_variants(catalog)
       absent_variants(catalog).map do |variant|
-        variant.on_demand = false
-        variant.on_hand = 0
+        if variant.on_demand
+          variant.on_demand = false
+        else
+          variant.on_hand = 0
+        end
       end
     end
 
diff --git a/spec/system/admin/dfc_product_import_spec.rb b/spec/system/admin/dfc_product_import_spec.rb
index 83c784b570..a7d8b53c3f 100644
--- a/spec/system/admin/dfc_product_import_spec.rb
+++ b/spec/system/admin/dfc_product_import_spec.rb
@@ -106,7 +106,7 @@ RSpec.describe "DFC Product Import" do
       .and change { linked_variant.on_demand }.to(true)
       .and change { linked_variant.on_hand }.by(0)
       .and change { unlinked_variant.on_demand }.to(false)
-      .and change { unlinked_variant.on_hand }.to(0)
+      .and change { unlinked_variant.on_hand }.by(0)
 
     product = Spree::Product.last
     expect(product.variants[0].semantic_links).to be_present