US President Donald Trump will impose tariffs on Australian steel as import war rages

Hopes of Australia securing a crucial tariff exemption on aluminium and steel imports have failed as the White House confirmed they will be imposed on Tuesday.

Soon after taking office, President Donald Trump announced a raft of tariffs set for implementation against various countries including Canada, Mexico, China and Australia.

Prime Minister Anthony Albanese spoke directly to President Trump weeks ago in a bid to secure a tariff exemption but that request has been dismissed with Mr Trump confirming the US will follow through and will impose a 25 per cent tariff on Australian steel and aluminium imports.

White House Press Secretary Karoline Leavitt told the ABC that President Trump considered Australia’s situation and decided not to allow an exemption.

“He considered it, and considered against it. There will be no exemptions,” Ms Leavitt said.

“American-first steel. And if they want to be exempted, they should consider moving steel manufacturing here.

“His (President Trump) tariff policies are in place so American workers are not ripped off all over the world.”

Mr Albanese called President Trump for discussions on tariffs, defence and trade after which Mr Trump said he would give “great consideration to the idea of an exemption for Australia on tariffs.

But after lobbying from Australia’s Ambassador to the US Kevin Rudd, Treasurer Jim Chalmers and Foreign Minister Penny Wong the announcement was made to include Australia in the tariff expansion.

Australia is estimated to export around 10 per cent of steel and aluminium into the US and are the tenth largest contributor of goods to the industry.

Although Australia does hold a trade surplus with the US, one of few countries around the world and which Mr Trump acknowledged was encouraging for trade relations, the idea of singling out certain countries for exemptions may be a lesson learned from Trump’s last administration.

Mr Albanese said on Monday the government would “continue to engage constructively … It is in Australia’s interest, but it’s also in the economic interests of the United States for Australia to be exempted.”

The tariff war continues to rage after Mr Trump doubled the steel and aluminium tariff rate for Canada to 50 per cent with the Canadians returning serve quickly and placed a surcharge on electricity exported to the US which Mr Trump called and “abusive threat”.

Australia’s former ambassador to the US Arthur Sinodinos also predicted the chance of an exemption this time was low.

“The Americans are very serious about the tariffs - both on revenue grounds and also to encourage more protection of American industry and encourage growth and investment,” Mr Sinodinos told AAP on Tuesday.

Australian Constructors Association chief executive Jon Davies said the looming tariffs meant uncertainty for the sector, after it was hit with material price rises after COVID and the war in Ukraine.

He said costs associated with steel products could rise because of the tariffs, which would impact construction prices.

“Any additional hit to the construction industry at this time will be extremely problematic,” he told AAP on Tuesday.

“It has no contingencies left to weather any significant impacts or downturns.”

with AAP.