China is a global manufacturing powerhouse, but far from being a manufacturing strongman. Take the humble ballpoint pen as an example, with import amounts exceeding $28 million in 2023, reaching an all-time high.
Former Chinese Premier Li Keqiang openly mentioned in 2016 that China relies on imports for ballpoint pen cores. Eight years have passed, and not only does China still depend on imported pen cores, but the import amount has also increased by 1.5 times. Industry insiders point out that both the ink for ballpoint pens and the machinery used to process pen cores need to be imported. Furthermore, suitable pen tip steel for imported ink has not yet been produced domestically.
According to China Customs data, the import amount of ballpoint pen cores in 2023 exceeded $28 million, 2.5 times higher than in 2017. Except for individual years, such as 2020 during the peak of the pandemic, the import amount has shown a year-on-year increasing trend.
Blogger Zhang Hang, who has long been focusing on Chinese manufacturing, stated in a Weibo post in June 2023 that even for a ballpoint pen core consisting of only seven parts, China still needs to import 170 million pieces annually from Japan. Until 2021, 80% of the core component, the ballpoint, still needed to be imported.
The average price of a ballpoint pen from Japan’s stationery giant, Pentel, is over 6 yuan, while China’s leading pen manufacturer, Deli, mainly offers pens for 1 yuan each. Pentel holds 13,000 patents, whereas Deli has only 406 patents (source: Tianyancha).
During a steel industry capacity forum in Taiyuan, Shanxi in January 2016, former Premier Li Keqiang mentioned that despite China’s severe overcapacity in steel production, the country still imported high-quality steel products and components such as mold steel and ballpoint pen balls.
Lin Xueping, a Chinese Ministry of Industry and Information Technology think tank expert focusing on Chinese manufacturing, pointed out in an article on WeChat’s “Knowledge Automation” account in April 2023, as well as in a discussion on the “Starsea Business Review” program in December 2023, that there are three reasons why China needs to import ballpoint pen cores.
Firstly, there are compatibility issues between domestic pen tip steel and imported ink. Ink and pen cores need substantial time to match well, as German WENDU ink and Japanese Mitsubishi pen cores have been harmonizing for decades. When importing ink and using domestically produced pen tip steel, steel mills often need to adjust ingredients. This endless improvement, coupled with minimal output, will only lead to further contraction, and eventually, the entire industry may abandon such efforts.
Zhang Hang indicated in the mentioned article that despite China producing 38 billion ballpoint pens annually, only 1,000 tons of ballpoint pen balls are needed. However, a steel plant’s daily output in one workshop ranges from 2,400 to 3,600 tons. Even the smallest 60-ton blast furnace incurs a cost of 600,000 yuan just to ignite it, and repetitive equipment restarts pose risks of damage, with each production line investment often exceeding one billion yuan.
Secondly, there are operational issues with imported machinery. Compared to Japanese pen tip steel, domestic pen tip steel has subtle compositional differences, requiring machine adjustments. These machines mainly come from Switzerland’s Mikron company, necessitating complex machine adjustments that heavily rely on experienced operators working in the field for many years.
Lastly, there are compatibility issues between the pen core ball and ink. Ink is imported from Japan or Germany, and getting the ball and ink to cooperate is quite troublesome.
According to an article from the well-known blogger “CogWorld,” companies producing multi-station pen head processing machines, such as Switzerland’s Mikron, process the majority of the world’s ballpoint pen heads using Mikron’s machines.
During the Shanghai Import Expo in November 2019, a combined machine tool from Swiss company Mikron could produce up to 160 stainless steel pen heads in just one minute.
Ballpoint pen cores consist of a ball and a socket, with the socket requiring more than ten processing steps, presenting a high technical threshold for processing machines.
Firstly, they are small in size and have relatively complex internal structures. The socket is only about 2mm in size, featuring concentric stepped rings evenly distributing five narrow ink channels.
Secondly, they demand extremely high precision in processing. The socket’s ink channels must have a precision of 1 micron, and the bowl at the top of the socket for the ball should have a precision requirement of 2 microns. The surface roughness threshold needs to reach 0.4 microns.
Machinery is the “mother machine” for manufacturing machines, the core sector in the equipment manufacturing industry, and the cornerstone of modern industries. However, high-end machinery in China, such as machines for processing ballpoint pen cores, still significantly lag behind their foreign counterparts.
According to QYResearch, an international information consulting firm specializing in industrial data, in a July report on the advanced CNC machinery market, the core global manufacturers are Yamazaki Mazak (Japan), Trumpf (Germany), DMG Mori Seiki (a joint venture between Germany and Japan), Okuma Corporation (Japan), and JTEKT Corporation (Japan), collectively holding about 47% of the global CNC machinery market share, with no Chinese companies among them.
Regarding the domestic market share of Chinese machinery companies, the “China Business Review” reported on November 22 this year that China has been the world’s largest manufacturer and consumer of machinery for 15 consecutive years. Still, the localization rate for high-end CNC machinery is less than 10%.
Five-axis simultaneous machining technology represents the highest level of technology in the machinery field. Five-axis CNC machine tools are the sole means to process critical industrial products like aircraft engine turbines, discs, blades, and marine propellers.
Lin Xueping mentioned in a previous interview that China’s high-end five-axis machining centers have been facing supply disruptions. In reality, Chinese machinery companies can provide products of the same standard, but the market prefers not to use domestically made machinery. This is because the lifespan of domestic machinery is only one to two years, and the accuracy will quickly deteriorate. Moreover, the qualification rate of machinery cannot be guaranteed; for example, among producing one hundred machines, there may often be ten that are defective. Purchasing machinery becomes akin to playing the lottery, severely affecting production efficiency.
According to MIR Industrial Data, the market share of domestically produced five-axis CNC machine tools in 2021 was less than 20%. While the static accuracy of some domestically produced machine tools is close to international standards, discrepancies exist in terms of dynamic performance, accuracy retention, such as rapid accuracy decline, numerous component issues, poor environmental adaptability, and large fluctuations in accuracy due to temperature effects.