It tells:
(i) You are capable of great things. One should not forget that a hand (of God) is guiding as He always guides us according to our will.
(ii) Sometimes the pencil has to stop writing and use a sharpener. That way it becomes sharp after suffering a little. So one must learn to bear pains, because they make one a better person.
(iii) What really matters is a pencil is not its wooden exterior but the graphite inside it. So always pay attention to what is happening inside.