一．The total consumption scale and import and export calculation of the tool market in 2021

According to the survey and analysis of statistical data of member units, customs data, statistical data of tool raw materials, and data of tool gathering areas, the Tool Branch of China Machine Tool Industry Association has calculated the total consumption scale and import and export volume of my country's tool market in 2021.

1. The total consumption scale of my country's tool market in 2021

The total consumption scale of my country's tool market has increased from 42.1 billion yuan in 2020 to 47.7 billion yuan in 2021, a year-on-year increase of 13.3% (Figure 1), a new high. Among them: domestic knives are about 33.9 billion yuan, accounting for 71%, a year-on-year increase of 17%; imported knives (including foreign brands produced and sold in China) are 13.8 billion yuan, accounting for 29%, a year-on-year increase of 5.3%. Domestic knives have grown significantly in the Chinese market, and their proportion has increased by 2 percentage points compared with 2020. After two consecutive years of decline, imported knives grew at a low speed, and the proportion decreased by 2 percentage points compared with 2020.

Figure 1 Changes in the scale of China's tool market from 2005 to 2021

Domestic tool production and sales (domestic sales + export): 45.3 billion in 2018 (27.3 billion + 18.4 billion); 44.1 billion in 2019 (25.7 billion + 18.4 billion), a year-on-year decrease of 2.6%; 2020 (29 billion + 18 billion) ) was 47 billion, a year-on-year increase of 6.6%; in 2021 (33.9 billion + 22.5 billion) to 56.4 billion, an increase of 20%.

2. Scale of imported knives (foreign brands) in 2021

The total size of my country's tool imports (including foreign brands produced and sold in China) will increase from 13.1 billion yuan in 2020 to 13.8 billion yuan in 2021, a year-on-year increase of 5.3% (Figure 2).

There is a certain difference between import data and customs data (including year-on-year growth), because the statistical caliber is not completely consistent, and foreign brands are produced and sold in China.

Figure 2 Changes in my country's tool imports from 2005 to 2021

3. National tool export scale in 2021

my country's tool exports will increase from 18 billion yuan in 2020 to 22.5 billion in 2021, an increase of 25.45%.

二、The development of cutting tools in my country in recent years

Based on statistical data and survey analysis, the following introduces the development of knife varieties with relatively large production and sales in my country in recent years (2018 to 2021).

1. Domestic knives have made significant progress

According to the calculation of the Tool Branch, the market share of domestic tools in China will increase from 65% in 2018 to 71% in 2021. The export value of cutting tools remained basically stable from 2018 to 2020, with a 25.45% increase in 2021.

2. Carbide tools are growing rapidly

With the progress of my country's manufacturing industry, the demand for cemented carbide tools continues to grow. At the same time, in recent years, my country's cemented carbide tool industry has made significant progress in materials, coatings, process equipment, etc., which has driven the rapid expansion of production capacity and attracted capital attention to accelerate the process of production expansion.

Among the cemented carbide cutting tools, there are two types of cutting tools with large production and sales volume and rapid development: one is solid carbide round shank tools (hereinafter referred to as solid carbide cutting tools), mainly milling cutters and drills; the other is CNC inserts.

（1）The ups and downs of the whole hard tool

The main user fields of solid hard cutting tools are: 3C represented by mobile phones, molds, transportation, aerospace, etc. my country is a big country in the production of mobile phones, and the amount of hard cutting tools is huge, which is one of the main reasons why international tool giants speed up the acquisition of hard cutting tool companies in my country.

The 3C industry represented by mobile phones is highly cyclical and the product design is updated quickly, which makes the demand for such tools fluctuate greatly. Rapid growth in 2017 and 2018, sharp decline in 2019, rapid rebound in 2020, rapid growth in the first half of 2021, and slowdown in the second half.

The raw material of this type of tool is carbide bar, and the market demand can be seen from the output of the bar. National annual output of bars: 11,000 tons in 2018; 8,321 tons in 2019, a sharp drop; 11,000 tons in 2020; 14,600 tons in 2021.

The entry threshold for solid hard tools is low, and the main processing equipment is CNC tool grinders. The rapidly growing market demand has made the production capacity of such tools expand rapidly, and a large number of small and medium-sized enterprises have begun to produce such tools. Therefore, the price competition is fierce, and some companies have poor profitability.

The high-end user areas, such as aerospace, are still dominated by imported brands.

(2) CNC blades continue to grow

CNC inserts are products with high added value, and are also the tool variety with the largest import volume. In recent years, the production and sales of CNC blades in my country have continued to grow, even in 2019 when the entire industry is adjusted.

According to the survey, the production and sales volume of CNC blades in my country was 235 million in 2018, 250 million in 2019, 300 million in 2020, and 450 million in 2021. From 2021 to 2022, capacity expansion will further accelerate.

Carbide cutting tools (mainly blades) are the most imported cutting tools in my country, accounting for about 40%. According to customs data, in 2021, my country will import 638t of carbide-coated tools (mainly blades) and 680t of cemented carbide non-coated tools (including some blades). Based on this, it is estimated that the number of imported blades will be more than 100 million. In 2021, the average unit price of imported carbide-coated tools (mainly blades) will be 4,251.36 yuan/kg, while the average unit price of exported carbide-coated tools (mainly blades) will be 1,116.79 yuan/kg.

According to the 2021 annual report of the Tool Branch, the average unit price of CNC blades in the industry is less than 7 yuan per piece.

my country's CNC blades are cheap and high-quality, and have made great contributions to improving the efficiency of the manufacturing industry. Due to its high added value, at present, most blade manufacturers have better profitability. However, from granulation, pressing, sintering, grinding to coating, the product has a long process chain and large equipment investment, which is a capital-intensive product. Moderate capacity expansion can promote competition and facilitate the high-quality development of the industry; however, excessive expansion is not conducive to the sustainable and healthy development of the industry.

The gap between this type of products and the international advanced level is mainly due to original solutions and supporting capabilities, service and quality stability, which is also one of the main reasons for the huge price difference between domestic and foreign blade products.

3. The high-speed steel tool market is basically stable

From 2018 to 2020, my country's high-speed steel production has remained basically stable, with a slight increase in 2021. In terms of high-speed steel cutting tools, there are not many new companies entering the industry in recent years, the industrial structure has not changed much, and the profitability of leading companies is stable.

The most advantageous varieties of high-speed steel tools are mainly taps, broaches and medium-modulus gear tools, among which the production and sales of taps are the largest. In 2021, my country will import 1.07 billion taps and export 780 million yuan (including a small amount of alloy taps), with a 10-fold difference in the unit price of import and export. High-end taps have great market potential, which is one of the reasons why some companies have newly entered the field of tap products.

In terms of variety changes, the small and medium-sized high-speed steel drills and milling cutters were partly replaced by solid-hardened tools, and the medium-large-sized drills, milling cutters and gear cutters were partly replaced by indexable carbide tools.

The development of high-speed steel cutting tools in recent years is mainly reflected in the progress of raw materials, the progress of process equipment and the optimization of subdivision fields.

40% of the total production capacity of cutting tools in my country is exported, among which the export volume of drill bits is the largest, accounting for nearly 40%. In 2021, my country's drill bit exports will be 8.6 billion yuan, mainly high-speed steel (including alloy high-speed steel) drill bits. my country is the main producer of such tools, and the main export enterprises have stable profits.