Qld walking on sunshine - 2022 set to be bumper resources year
12 April 2022
The Queensland Resources Council’s (QRC) latest CEO sentiment survey results are in – and the news is good for every Queenslander.
QRC Chief Executive Ian Macfarlane said all signs point to a bumper year for Queensland’s resources sector – and the Queensland budget.
“Our resources portfolio is positioned for a very strong 2022, with most commodities enjoying strong domestic and international demand,” Mr Macfarlane said.
“70 percent of resources CEOs are feeling much more confident about their company’s growth prospects over the next 12 months; 95 percent agree Queensland’s resources sector has a strong, long-term future; and 35 percent say they’re likely to increase employment at their operations over the next 12 months.
“No CEOs expect to be cutting jobs.”
Mr Macfarlane said Queensland has experienced record or recent-record prices over the past six months for metallurgical coal, thermal coal, LNG, copper and aluminium, which account for around 90 percent – or $60 billion – of the total value of state resources exports.
Mr Macfarlane said every Queenslander benefits from the mining and energy sector’s prosperity because the royalty taxes paid by resources companies to the State Government automatically go up as commodity prices increase.
“The stronger our sector performs, the more royalty taxes are generated for the State Government, which go directly into the budget to fund essential government services and infrastructure such as healthcare, education, transport and law and order.
“Resources royalties generated this financial year in Queensland are expected to reach around $6 billion, which is double the amount paid last year and demonstrates why the resources sector is so important to our economy and to jobs.
“These royalties are part of our sector’s overall $84.3 billion contribution to the state economy last financial year, which is helping enormously with Queensland’s economic recovery from Covid.”
Mr Macfarlane said Queensland’s position as a global-scale exporter of a diverse range of commodities – such as metallurgical coal, LNG, thermal coal, copper, silver, lead, zinc, gold, aluminium and bauxite – gives it a major advantage over other resources regions.
The QRC’s CEO sentiment survey also revealed the biggest worry for resources leaders right now is a major skilled worker shortage, with the situation expected to worsen now companies based in Western Australia – no longer restricted by border closures – are recruiting in eastern states.
The impact of Covid-related public health measures on their workforce – such as employees being unavailable at short notice and a lack of alternative options – jumped from eighth to number two on the list of CEO concerns, followed by worry about the impact of Queensland’s uncertain and/or poor regulatory environment on the sector.
Other key points:
- 95% of CEOs expect demand for their commodities to increase over the next 12 months, and 80% expect demand to increase over the next three years. Only 20% of CEOs expect price volatility to increase further over the year.
- QRC member CEOs almost universally agreed on growth, but the road to getting there varied. Half of CEOs looked to organic growth – exploration, development and capital investments – as the major growth driver for their business, while 15% expected productivity gains and a further 15% saw mergers and acquisitions as the key to growth.
- More than half (55%) of CEOs said they are likely or very likely to consider Queensland expansion opportunities in the next 12 months, with only one in 10 CEOs saying they are unlikely to consider expansion over this period.
- Increasing job opportunities will benefit more than just the resources sector. The QRC’s 2020-21 economic contribution data highlighted the number of jobs supported by the resources sector is around six times the number of direct jobs, which is great news for every Queenslander.