Donald Trump has rejected Australia’s plea for an exemption from US tariffs on steel and aluminium imports, which were scheduled to begin on Wednesday.
“He considered it and considered against it. There will be no exemptions,” the White House press secretary, Karoline Leavitt, told Australian media in Washington overnight.
“American-first steel. And if they want to be exempted, they should consider moving steel manufacturing here.”
The global 25% tariff regime was due to come into effect at midnight US time.
Trump had said he would give “great consideration” to an exemption for Australian metals after a phone call with the prime minister, Anthony Albanese. Australian officials have lobbied Washington in the weeks since Trump announced the new tariff regime in an attempt to secure a carve-out.
A spokesperson for the Australian government said on Wednesday morning that it had “been working hard at all levels to secure an exemption”.
“We remain in discussion with the United States administration, and will have more to say.”
The levies are part of a broader suite of tariffs Trump has vowed to pursue to level what he regards as an unfair global trading regime.
He said this week the tariffs would enrich the US: “We’re going to take in hundreds of billions of dollars in tariffs, and we’re going to become so rich, you’re not going to know where to spend all that money.”
Overnight Trump threatened to raise the tariffs on Canadian steel and aluminium to 50% from 25%. There are also forecast tariffs on pharmaceuticals and agricultural products that could have an even greater impact on Australian exporters.
A senior Australian cabinet minister, Mark Butler, said Trump’s tariff decision would damage Australia’s relationship with its closest security ally.
“This is a disappointing decision,” he told ABC television. “It’s a bad economic decision. It’s bad for our relationship.
“It’s bad for the US, ultimately, because we think that the exports we send to them – which are significantly less than the exports they send to us – are good for the US economy. They’re good for US industry. They’re particularly good for defence, which is an important area of cooperation.
“We think this is a bad decision that’s disappointing, and we’ll continue to press the case for it.”
Butler said Australia’s campaign for a unique carve-out from the comprehensive tariff regime was “not over by any means”.
“We’ve only been going at this for almost seven weeks that President Trump has been back in office,” he said.
“We intend to continue to press the case at the highest level, particularly ambassador [Kevin] Rudd has been relentless in this, meeting with officials almost constantly to press the … case.”
The housing minister, Clare O’Neil, told Channel 7 that Australia was still in discussion with the US, “so I’m not going to accept this as the situation yet”.
“We still have a little bit of time and lots of discussions continuing to happen,” she said.
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“We’re in a world where Canada and Mexico, the two largest trading partners of the US, will have tariffs imposed. In Canada, perhaps even at 50%. I think to put it mildly, we’re operating in a new context here.
“It is obviously in Australia’s best interests for these tariffs not to be imposed. We are doing everything we can and fighting with every single tool that we have available in order to get ourselves in the best possible position.
“We’re still continuing those negotiations and discussion. That will continue until the very last moment.”
In Trump’s first term as president, Australia won an exemption from steel and aluminium tariffs, arguing than it was an ally with which the US had a trade surplus (the US exported more goods to Australia than it imported from Australia).
But Malcolm Turnbull, the former prime minister who secured the 2018 exemption has since argued that the chances of a second reprieve were low because Trump regretted concessions granted in his first term.
The “surplus” argument was also undermined by the fact that in January 2025, for the first time since the US census bureau published records, Australia recorded a trade surplus with the US. This was driven, almost wholly, by a run on gold in the US. Australia shipped a record amount of gold to the US in January – worth US$2.9bn – according to Australian Bureau of Statistics figures, the highest figure in records dating back to 1995.
Investors in the US, fearful of the impact of an uncertain and potentially punitive tariff regime, have taken refuge in the safe-haven asset, driving prices to new records last month.
Rhetoric from the White House hardened . Trump’s trade adviser, Peter Navarro, accused Australia of dumping subsidised, below-cost aluminium into the US market, comparing Australia to Russia and China in exploiting the US.
Australia’s fight for tariff relief exists within a chaotic and deepening trade war globally.
US stocks had their worst day of the year on Monday amid fears of a recession.
Asked if he was expecting a recession this year on the back of his rollout of a global tariff regime, Trump replied: “I hate to predict things like that. There is a period of transition because what we’re doing is very big.”
Trump’s trade war with Canada has intensified. The president announced he would double the rate on Canada to 50% when the tariffs start at midnight, Wednesday morning.
He said the impost was in retaliation for Ontario, Canada’s most populous province, imposing a 25% surcharge on electricity exported to the US.
Trump then backtracked on the extra tariff when Ontario suspended its electricity surcharge.