Leather Chemical Industry: Energy Saving And Emission Reduction Are Both Challenges And Opportunities.

From the perspective of the total energy consumption in China, apart from the industrial energy consumption of various production industries, the proportion of pportation energy consumption and building energy consumption accounts for 7.40% and 47.24% respectively.

The most important thing in the implementation of the "pportation energy efficiency" is the liberalization of the oil price. Considering that if the price liberalization of the finished product may bring about an increase in the consumption expenditure of the residents, the government can simultaneously implement policy subsidies for public goods, such as public pport.

Therefore, the subsidy policy status of public goods is one of the important prerequisites for the liberalization of oil products prices.

Correspondingly, taking into account the sources of subsidy funds and drawing lessons from foreign experience, the policy of resource tax collection will be another important prerequisite for the liberalization of China's oil products prices.

Reviewing the collection policy of domestic resource tax and the subsidy policy of public goods, the two preconditions of China's liberalization of refined oil prices have come into being.

The implementation of "building energy efficiency" should break through the policy bottleneck data and show that wall insulation is the top priority of building energy efficiency.

At present, polyurethane and polystyrene are the two best choice for thermal insulation materials.

In order to reflect the dynamic cost performance, the policy will be an important driving force for the application of polyurethane materials.

It is worth mentioning that since 2005, China has entered the third stage of the promulgation and implementation of the substantive building energy efficiency policy.

At the same time, the proportion of the implementation of energy saving standards in the design stage of the urban construction projects and the implementation of energy conservation standards in the corresponding construction stages have increased markedly since 2005.

As the main raw material of polyurethane foam insulation material, MDI has increased more market expansion space for related enterprises due to high level technical barriers.

Buying "Yantai Wanhua" and increasing the "Sinopec" from the business structure, if the price of oil products is liberalized, Sinopec (60028) will be significantly benefited.

But it is worth noting that accompanied by the liberalization of China's oil prices will be a package of supporting policies, such as the relevant fiscal subsidy policy in recent years will be abolished, and it is possible to levy related resources tax.

On the whole, Sinopec's (600028) future performance is expected to continue to grow after the positive and negative factors are offset, but the growth rate is limited, giving the "overweight" rating.

In terms of building energy efficiency, as the only listed company that has the advantage of technology monopoly in China to produce MDI, Yantai Wanhua (600309) is expected to give a "buy" rating in the future.

Oil prices are approaching us $140.

In a sense, the energy crisis is an indisputable fact.

"How to resolve the energy crisis?"

It has been raised to the important agenda of governments.

Obviously, the development of alternative energy (new energy) is one of the important channels to resolve the energy crisis.

We can easily list listed companies related to new energy. Indeed, the two tier market performance of new energy listed companies is eye-catching.

In fact, "energy conservation and emission reduction" is another important channel to resolve the energy crisis.

It should be said that "energy saving and emission reduction" is also a very familiar term for investors. But if we want to list the listed companies related to "energy saving and emission reduction", or what kind of investment opportunities will "energy saving and emission reduction" bring to investors?

This may not be an easy task.

From this perspective, this paper points out the solution to "energy saving and emission reduction energy crisis" from the perspective of chemical investment.

The implementation of the "pportation energy efficiency" should pry up the price lever. The most important thing is the liberalization of the price of refined oil. The "big" energy consumption and low energy efficiency can be summarized as the two major characteristics of China's energy consumption.

Therefore, the core of energy conservation and emission reduction is to improve energy efficiency.

From the perspective of the total energy consumption in China, apart from the industrial energy consumption of various production industries, the proportion of pportation energy consumption and building energy consumption accounts for 7.40% and 47.24% respectively.

In a sense, the price of low refined oil actually encourages consumption, which is a departure from the typical pattern of energy conservation and emission reduction.

Therefore, the implementation of "energy saving" should first pry the price lever, and the most important thing is the liberalization of the price of refined oil.

In fact, the marketization reform trend of refined oil prices is a common knowledge of the society.

But for our investors, what is important is the "time" process of oil price liberalization.

At present, the general view of the market is that the price of refined oil can not be released at present. The main reasons lie in two points: the difference between domestic and international refined oil prices is big, and the CPI of our country is high.

In other words, the general view of the market is: "when the price difference between domestic and international finished products is narrowed" and "or after China's CPI decline", the price of refined oil will be released again, thereby reducing the impact on the whole macro-economy and achieving a smooth pition.

Theoretically, this is an ideal choice, but not necessarily in practice.

The judgment of "narrowing the price difference between finished products at home and abroad".

Data show that the OPEC global oil remaining proved reserves account for 75.20%.

The characteristics of resource monopolization under the background of the constant strengthening of OPEC power determine that crude oil prices will not be significantly reduced in the future.

In other words, the premise of falling crude oil prices is that the international crude oil giants have seen profits rise or fall when crude oil prices rise.

However, the possibility of such a phenomenon should be small. Thus, the possibility of reducing the oil price difference between the domestic and international markets should not be large after passively waiting for the oil price to drop.

As for the "oil price liberalization may impact on domestic CPI formation" view.

From the definition of CPI, the statistics of domestic CPI have aroused widespread concern and controversy in the society.

There is a market view, because domestic prices rise significantly, but domestic CPI statistics do not contain housing prices, so CPI can hardly reflect residents' consumption expenditure.

Referring to the practice of CPI in the mature market of foreign countries, the United States and China are very similar - there are 8 major categories. Neither the United States nor China has included the price of housing in the statistical category, but the "virtual rent" has been included in the statistical category.

But what we notice is that the statistical weights of the "virtual rent" between the US and China are quite different.

Data show that the weight of living class (including household equipment) in China's CPI statistics is 19.2%, while the figure in the United States is as high as 42.1%.

The main reason for the difference is that the weight of the US residence class contains a "virtual rent" of up to 21.2% of the weight. (CPI) in China, although there are "virtual rents" in the residential category, the weights are not limited.

From this perspective, if the "virtual rent" weight is added to the CPI structure of China, if the price of the finished oil is liberalized and the price of the house falls to a certain extent, CPI will not necessarily increase, and it may decrease.

On the other hand, if the price liberalization of oil products may increase the consumption expenditure of the residents, the government can also implement policy subsidies for public goods, such as public pport.

Therefore, the subsidy policy status of public goods is one of the important prerequisites for the liberalization of oil products prices.

Correspondingly, taking into account the sources of subsidy funds and drawing lessons from foreign experience, the policy of resource tax collection will be another important prerequisite for the liberalization of China's oil products prices.

Reviewing the relevant policies in China, China has introduced policies to levy special income on oil enterprises since 2006.

Although there is still a certain gap between the content and scope of the levy and the western developed countries, China has made an important step from the perspective of resource tax collection policy.

Moreover, the current government is actively considering the implementation of the new resource tax and mineral subsidy policy. The proposed resource tax levy will be changed from volume to ad valorem, and the tax rate will be increased from 5% to 10%, while the rate of mineral subsidy will be increased from 1% to 5%.

In general, China's resource tax collection policy system is gradually forming, and gradually with the international standards.

At the same time, we noticed that the four ministries and commissions jointly issued the "opinions on preferential economic policies for urban public pport" issued by the state ministries and commissions in December 2006 have elaborated on the subsidy of public pport from the perspective of central subsidies, local subsidies and special subsidies, and have set up an important framework for constructing our public goods subsidy policy system.

In a sense, the two preconditions of China's liberalization of refined oil prices have come into being.

From the perspective of the business structure of Sinopec (600028) and PetroChina (601857), it is clear that if the price of finished oil is liberalized, Sinopec (60028) will have obvious benefits.

But it is worth noting that if China's oil prices are liberalized, this policy will be a package of supporting policies.

Or, if the price of finished oil is liberalized, the relevant financial subsidy policy of Sinopec (600028) will be abolished in recent years, and the related resources tax will be added.

From this point of view, if the price of oil is released, Sinopec (600028) will be the biggest beneficiary, but its benefit will be largely offset by the cancellation of fiscal subsidy policy and the Levy of resources tax.

However, overall, Sinopec (600028) is expected to continue to grow in the future, considering Sinopec (600028) in 2008, 2009 and 2010 EPS respectively 0.67 yuan, 0.71 yuan and 0.78 yuan, to Sinopec (600028) to give "overweight" rating.

The implementation of "building energy efficiency" should break through the bottleneck of policy. From the proportion of building energy consumption, the insulation of building walls (including roof and ground) is the most important part of "building energy efficiency". Data show that the heat consumption of building walls in China (including roof and ground) has reached 40.5%.

Polyurethane and polystyrene are the two most widely used foam materials for building wall insulation materials.

According to the current market situation of related products, the former is weaker than the latter in terms of static price performance ratio, but the former is obviously better than the latter in terms of dynamic cost performance.

It is precisely because of the difference between static cost performance and dynamic cost performance that the popularization process of domestic polyurethane materials is relatively slow.

In this sense, policy driven will be an important driving force for the popularization and application of polyurethane wall insulation materials.

It is worth mentioning that since the promulgation of the first regulations on building energy efficiency in 1986, the Chinese government has entered the third stage of the promulgation and implementation of the substantive energy conservation policy in 2005.

From the energy saving standard, it has increased from the original 30% to the current 50% and 65% of the important urban areas. From the scope of energy conservation, the energy saving of public buildings has been increased on the basis of civil building energy saving, and relevant policies have been promulgated on the basis of energy-saving materials for specific polyurethane energy-saving materials.

At the same time, the implementation of relevant policies for building energy efficiency in China has been significantly strengthened.

The implementation of energy saving standards in the design stage of urban construction projects in China has increased from 57.7% in 2005 to 97% in 2007, and the corresponding implementation stage has increased from 20.8% in 2005 to 71% in 2007.

In the context of global oil prices, the building energy efficiency market is ushering in great development opportunities. As the main raw material of polyurethane foam insulation materials, MDI has increased the market expansion space for the related enterprises due to the high level of technical barriers.

Simply measuring, the existing domestic building area is 40 billion square meters, and the annual construction of 2 billion square meters.

On this basis, according to the estimated MDI capacity of 2 kilograms per square meter, the limit demand of MDI will be measured by 100 million tons (and the current MDI capacity of the world is also millions of tons), and the corresponding market value will be measured by trillions of dollars.

In a sense, the price of MDI will rise sometimes.

At present, Yantai Wanhua (600309) is the only listed company in China that has the advantage of technology monopoly and can produce MDI.

If the market capacity of Yantai Wanhua (600309) reaches 5%, the company's performance can be doubled 10 times in China.

The future performance of Yantai Wanhua (600309) is worth looking forward to.