'Not over': Australia battling to fend off US tariffs

Australia believes it still has time to convince Donald Trump not to impose hefty tariffs on its steel and aluminium, despite his blanket refusal of exemptions.

News of the US president’s decision not to allow Australia relief from the 25 per cent levy has dented the federal government’s hopes, but the government still thinks a reprieve is possible.

“This is obviously deeply disappointing news, but we knew this was going to be a tough fight,” cabinet minister Mark Butler told ABC on Wednesday.

“The second Trump administration seems much more determined on this front than perhaps the first administration.

“But we don’t see this issue as being over, by any means.”

The tariffs on steel and aluminium sent to the US by all of its trading partners - “with no exceptions or exemptions” - are scheduled to take effect from 3pm Wednesday AEDT, the White House has confirmed.

Earlier, White House spokeswoman Karoline Leavitt told Australian media in Washington the hoped-for exemption was off the table.

“He considered it and considered against it. There will be no exemptions,” she told the outlets, including the ABC.

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

Australia’s reprieve hopes hinge on a historical precedent.

Mr Butler noted the previous federal government led by Liberal prime minister Malcolm Turnbull took nine months to get a tariff exemption during Mr Trump’s first term.

Australia also sends more goods to the US than the other way round, Mr Butler argued, adding that Australia’s $800 million worth of steel and aluminium exports to America each year underpins jobs in the US.

The coalition maintains Prime Minister Anthony Albanese should have travelled to the US to advocate in person on Australia’s behalf, like other leaders from Japan and India.

“This government just hasn’t done enough,” Deputy Opposition Leader Sussan Ley told Sky News.

But Japan’s trade minister on Tuesday confirmed he’d failed to secure an assurance on an exemption.

Former US ambassador to Australia, Jeff Bleich, said Australia’s leaders did “everything they could”.

“Australia did far more than any other country that I’m aware of, with respect to making compelling arguments to the Trump administration,” he told ABC radio on Wednesday.

“It was significant enough that the United States kept open that possibility until the very last minute.

“I can’t fault Australia for failing to make the right arguments or failing to be persistent.”

The arguments Mr Trump has used to refuse exemptions for other countries do not apply because of Australia’s trade surplus with the US, Mr Bleich added.

“It’s very difficult for me to see what real advantage there is to the United States in applying this tariff in this way at this time,” he said.

However, Australian Steel Association chief executive David Buchanan believes the tariffs will have a minimal effect on the domestic industry because some of the exports are used for internal processing in BlueScope Steel’s factory in Ohio.

“At this stage, there’s probably minimal impact on Australia and I would suggest that it’s not a huge impact for BlueScope,” he told ABC radio.

“Unfortunately, it’ll be passed onto the American consumer.”

Still, Australian Constructors Association chief executive Jon Davies said the tariffs mean uncertainty for the sector, which has weathered material price rises in the wake of COVID and the war in Ukraine.

Costs associated with steel products could rise, impacting 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.”