Environmental protection: the steel coal the solid moat

Steel, coal price is the main logical drive cycle stocks continue to rise this year, and this logic is the most solid starting point is the change of the supply side. Do not look good, but the market also to whole cycle industry suspect steel cycle industries such as coal price and profit growth is unsustainable, does not recognise the supply side to reform the administrative intervention in the market. Markets that steel coal industry as a traditional industry, serious excess capacity, industry has no barriers, and losses for many years, the enterprise debt by more than 70% on average, compared to the new energy, new technology, new mode, the steel coal price can't see any hope of rising, so the industry valuation pressure to less than historical levels. But, since June, steel, coal prices had regained, close to previous high all the way to the new breakthrough, the market began to interpret the 'supply side reform as a political task, must be successful'. Some people looked at the results, can't stand the temptation of rose, reform benefit of steel coal supply side side buy shares, or keep scold, but not on the position, not the time, still be little. Why since June, the market brings the opportunity for the reform of the supply side view changed again, the discussion of the new period began to set off? This is because the central offering out of the supply side, the reform of environmental supervision. Recently, whether from the beijing-tianjin-hebei region, Yangtze river delta, the pearl river delta region, execution of environmental supervision, unprecedented in the past at the expense of environment, the illegal business is being banned large area, especially the existence of more than 10 years more than 5000 ten thousand tons DeTiaoGang problem basically is cleared, far above the market. Environmental cost calculating do not calculate cost, calculating do not calculate the cost of compliance management, really want to do the calculation, most business owners have to laugh. Every storm of environmental protection in the past, everyone thought is a gust of wind, policy makers, a few days to deal with even if in the past, as long as willing to find a way to not check can't cope with. But, this time is different, the central environmental protection inspection team leader just know who is the leader in before he left, moving into place the environmental officials accountability and corporate compliance with environmental protection. In the case of environmental law enforcement and strict in place, the market about the simple and crude iron and steel industry, it is time no barriers have changed. DeTiaoGang is no barriers in the past, the small coal mine is no barriers, but now as their heavy industry, steel, coal industry innovation and environmental protection law enforcement strength on the supply side, the industry scale, capital barriers and barriers to compliance management is becoming more and more important, this will be for the past few years through information environment, cut corners, steal rows leakage to rectify, the abnormal development of tax evasion, greatly improve the steel coal industry leading enterprise bargaining power for a long time. So on the supply side superposition of reform of environmental law enforcement market environment, coal steel plate stock profits and a secondary market valuations will greatly improve, far more than the average for the past ten years. Look to the future, the coal industry is just out of poverty, to industry, asset-liability ratio from 70% to 50%, the industry profit improvement will continue for several years, environmental protection will be ChengGangTie coal industry the most solid moat.