Queensland’s resources sector is facing a slump in executive confidence as rising costs and regulatory burdens cloud the outlook, the state’s industry body said Tuesday.

According to the Queensland Resources Council’s (QRC’s) latest 'State of the Sector' report, nearly half of company CEOs are less confident about the next 12 months. Top concerns include royalties and taxation reform, growing operational expenses, and delays in project approvals.

“We must rebuild confidence after a decade of uncertainty and changing goal posts by the previous government,” QRC CEO Janette Hewson said in a statement. She added that “increased production costs, as well as the continuing impact of coal royalties are creating difficulties for producers".

The fifty-third edition of the 'State of the Sector' report offers a snapshot of sentiment across Queensland’s mining and energy companies, which collectively contributed A$120.2-billion to the state’s economy last year. The report spans companies operating across coal, gas, metals and critical minerals.

“Nearly half of member company CEOs are less confident about the next 12 months for the sector in Queensland on the back of falling demand for commodities, and the rising cost of production with only 35% considering expanding their operations,” Hewson said.

Despite short-term concerns, the outlook over a three-to-five-year horizon appears more optimistic, with most CEOs expecting demand growth to resume, underpinned by global decarbonisation trends.

“The longer-term outlook is more positive with a majority of CEOs expecting demand to increase over the next three to five years highlighting the ongoing potential of the resources sector to continue supporting jobs and Queensland’s economic prosperity,” she said.

QRC welcomed signs of reform from the state’s new government, including a pledge to accelerate approvals through a dedicated Resources Cabinet Committee. The industry has long criticised permitting delays for holding back investment.

“The Resources Cabinet Committee is a vital step forward. This week, QRC presented its recommendations to the Committee advocating for the removal of duplication and over-regulation to accelerate resources projects development,” Hewson said.

She cited geopolitical developments, including a recent pledge by US President Donald Trump to boost America’s coal exports, as a warning to Queensland to stay competitive.

“As we saw with President Trump’s announcement that the US will pursue a greater share of the global coal export market, it’s crucial that Queensland streamlines approvals to keep our state competitive,” she said.

The report also highlighted a growing focus on sustainability. About 75% of companies surveyed expect to invest in emissions reductions over the next year.

“This investment demonstrates the resources sector’s progress in reducing emissions and builds on the industry’s reputation in sustainable and responsible resource production,” said Hewson.

“The global energy transition is seen by member company CEOs as good news for the Queensland resources sector, driving increased demand for our coal, gas and critical minerals required to ensure a reliable and sustainable energy supply and to develop the renewable technology to support the transition,” she added.