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The U.S. has blocked the import of goods made by Chinese laser printer maker Ninestar, majority owner of U.S.-based Lexmark International, over the company’s alleged use of forced labor tied to China’s Xinjiang region.

Goods from Ninestar and eight Zhuhai, China-based subsidiaries will be restricted from entering the U.S. as of Monday because of the “companies’ participation in business practices that target members of persecuted groups” including Uyghurs, the U.S. Department of Homeland Security said.

“The use of forced labor offends our values and undercuts American businesses and workers,” Homeland Security Undersecretary Robert Silvers said Friday. “Forced labor is now a top-tier compliance issue, and businesses must know their supply chains.”

A representative for Ninestar didn’t respond to a request for comment.

The U.S. has engaged in an enforcement push to try to eradicate forced labor-linked goods from company supply chains through the Uyghur Forced Labor Prevention Act, a law that came into force last year. The Ninestar ban, announced Friday, shows government willingness to target a global company with substantial U.S. ties.

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The ban is on Lexmark and other NineStar brands.   It is unlikely it applies to relabelled Toshiba, Sharp and Xerox product.  The consumables are usually "chipped" to work exclusively with that brand.

Should the charges of forced labour and child labour be true, it is quite possible the above three OEMs may have to reconsider their relationship with Lexmark rather than risk reputational damage.

The ban does not apply to Canada nor Mexico. Where Lexmark product (in containers) are usually shipped into the US west coast and then into Lexmark distribution centres and then trans-shipped into these two countries there could be further problems.

Lexmark is a big supplier to the US gov't, the DND, school boards and hospitals so a sudden halt in supply is going to lead to another sh!tstorm.  Lexmark is big in financial services and banks.

Lexmark may not even be able to import toner and parts.

Whatever happens it will likely not resolve quickly.

The sh!t is going to fly starting Monday AM.

Last edited by SalesServiceGuy

HI all, I’m with Lexmark and want to clarify with some facts here:

First and foremost, Lexmark is not connected to these allegations and is not part of the order.

Lexmark operates as an independent company under a National Security Agreement in place with the U.S. Departments of Defense (DOD) and Homeland Security (DHS). Lexmark investors, including Ninestar, have no operational control over the company.

The allegations made against Ninestar are serious and do not reflect the standards Lexmark demands of our supply chain. We are stopping all shipments from Ninestar and its affected subsidiaries into the U.S. Only a small portion of Lexmark manufacturing comes from Ninestar and its subsidiaries so the transition should not disrupt our business.

The pain train keeps expanding for toner exports from China into the USA.

The DHS has already started to seize containers of printer chips from NineStar subsiduaries.  The collateral damage now includes select HP OEM toner cartridges and many toner remanufacturer cartridges,

On June 9th, the USA banned imports from China-based printer maker Ninestar Corp and their 8 subsidiaries.

Who is Ninestar? How are they involved in our industry?
Ninestar Corp is the largest company in the global aftermarket for cartridges and components.
Ninestar owns APEX/Geehy which has about 60-70% of the aftermarket cartridge chip market share and also owns 62% of Lexmark. APEX/Greehy makes all the chips for the new HP Jet Intelligence capable printer models produced over the last 5 years and 100% of the Lexmark machines produced in the last 7 years.

How will this affect Dealers?
Aftermarket toner providers will run out of stock as incoming replenishment containers have already been impounded.
Ninestar is the sole manufacturer of chips for some popular models. This will result in no new inventory arriving in the USA for the near future. HP SKUs for models produced in the last 5 years. (Ex. CF258A/X, W2020A/X series). We have about 10 months of inventory on hand.  A solution to this may be difficult since no other chip provider has launched this technology over the past year.  The likely solution for Remanufacturers will be to supply a used chip for the cartridge, which will not report page volumes/toner levels.  This is an unworkable solution for MPS providers.  Lexmark SKUs for machines produced in the last 7 years. (Ex. 58D1H00, 58D1U00, 58D1X00, 56F1H00, 56F1U00) We have about 4-6 months of inventory on hand.

What is our plan? What will happen to Gold Line toner?
The key difference with Gold Line over most other brands in the market is that we design and engineer our Bill of Materials (BOM).When Gold Line toner was created in 2017, we adopted a multiple contract manufacturer model and qualified several  vendors per SKU.

This model gives us the ability to move SKUs between assembly partners when we see quality issues or supply chain disruption (EG. During COVID) We will run out of stock on some SKUs as we transition to our other partners and wait 60-90 days for new inventory to be built and shipped. We anticipate 10% of our SKUs will experience stock outs as we work to transition SKUs to our other qualified Gold Line partners.

We are working tirelessly to develop solutions as we all adjust to the reality that the largest company in the global aftermarket for cartridges and components is no longer an option.

Last edited by SalesServiceGuy

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