Donald Trump’s administration has accused Australia of disregarding its past commitments on exports, in a fresh development as he threatens to hit the country with 25 per cent tariffs on aluminium and steel. 

In an executive order signed by the US President in the Oval Office, Mr Trump did not exempt Australia from the forthcoming tariffs – at least, not yet – despite saying the U.S. would give a possible exemption ‘great consideration’. 

But a proclamation attached to this order suggests it is premature to suggest Australia had been given an exemption from the new rules, due to come into effect on March 12, arguing American imports from Australia were much higher compared with his first term in the White House.

‘The volume of US imports of primary aluminum from Australia has also surged and in 2024 was approximately 103 percent higher than the average volume for 2015 through 2017,’ it said.

‘Australia has disregarded its verbal commitment to voluntarily restrain its aluminum exports to a reasonable level.’ 

President Trump had earlier hinted Australia could be granted an exemption, similar to a 2018 carve-out, after he spoke by phone with Prime Minister Anthony Albanese earlier on Tuesday.

‘I told him that that’s something that we’ll give great consideration to,’ Mr Trump said.

Mr Trump also called Mr Albanese a ‘very fine man’, and said that Australia’s trade surplus with United States put the country in a good position.

Donald Trump has accused Australia of disregarding his position on 25 per cent tariffs on aluminium and steel

‘We have a surplus with Australia. One of the few. And the reason is they buy a lot of airplanes,’ the President said. 

‘They’re rather far away and they need lots of airplanes. We actually have a surplus.’

Mr Albanese told reporters in Canberra on Tuesday he had made the case for Australia to get an exemption, based on the United States having a trade surplus with Australia. 

‘I presented Australia’s case for an exemption and we agreed on wording to say publicly which is that the US President agreed that an exemption was under consideration in the interests of both of our countries,’ the Prime Minister said.

‘We’ll continue to engage quite clearly, constructively.’

President Trump signed the ‘Adjusting Imports of Steel into The United States’ presidential action on Tuesday, Australian time.

In 2018, Australia was granted an exemption from 25 per cent American tariffs on steel and 10 per cent import taxes on aluminum after then prime minister Malcolm Turnbull pointed out the US had trade surpluses with Australia – where Aussies bought more goods and services from Americans than they bought from us.

But Mr Trump has unveiled new proclamations that extended his Section 232 tariffs of 2018, that were designed to protect American steel and aluminum manufacturers on national security grounds.

Mr Turnbull on Monday night told the ABC’s 7.30 he was able to secure this exemption by standing up to Mr Trump, during his first term, rather than being obsequious.

President Trump had earlier hinted Australia could be granted an exemption after he spoke by phone with Prime Minister Anthony Albanese (pictured right with fiancée Jodie Haydon) earlier on Tuesday

President Trump had earlier hinted Australia could be granted an exemption after he spoke by phone with Prime Minister Anthony Albanese (pictured right with fiancée Jodie Haydon) earlier on Tuesday 

‘If we want to be respected, we have to stand up,’ he told host Sarah Ferguson.

‘And there is a tendency, particularly in parts of the media in Australia, to sort of encourage Australian leaders to be sycophantic to the Americans. I mean, it’s exactly the 180-degree reverse of what we should be doing.

‘If we’ve got to win their respect, you win their respect by being true to yourself.’

New South Wales Premier Chris Minns, whose state produces steel and aluminium, said Australia deserved an exemption from the tariffs, by virtue of the Americans having a trade surplus with Australia.

‘The simple truth of the matter is, Mr Speaker, that America has a trade surplus with Australia,’ he told Parliament on Tuesday.

‘We import far more from the United States than we export. That’s a key part of American foreign policy and their decisions as it relates to tariffs and quotas going forward.

‘What that means, in simple terms, Mr Speaker, is Australia shouldn’t have tariffs applied to their steel and aluminium.’

NSW is home to the BlueScope steelmaking plant at Port Kembla in Wollongong and the Tomago Aluminium smelter in Newcastle.

New South Wales Premier Chris Minns, whose state produces steel and aluminium, said Australia deserved an exemption from the tariffs, by virtue of the Americans having a trade surplus with Australia

New South Wales Premier Chris Minns, whose state produces steel and aluminium, said Australia deserved an exemption from the tariffs, by virtue of the Americans having a trade surplus with Australia

The United States has had a free-trade agreement with Australia since 2005, guaranteeing tariff-free access into each other’s markets, which tariffs on steel and aluminium could potentially breach.

AMP chief economist Shane Oliver predicted the Trump Administration’s trade war could last another six to nine months.

‘This poses an ongoing threat to shares, but their relative resilience so far – with US, global and Australian shares around record highs – risks emboldening Trump to do even more,’ he said. 

Dr Oliver said that even if tariffs were imposed on Australian steel and aluminium,  the economic effects would be minimal with exports of both metals to the US marking up just 0.03 per cent of Australian gross domestic product.

Trade tariffs are more likely to weaken the Australian dollar, as the US dollar gets a boost, which in turn feeds domestic inflation.

A trade war could also weaken economic activity, making a rate cut on February 18 from the Reserve Bank even more likely. 

 ‘The RBA is expected to start cutting interest rates next week and trade war uncertainty adds to the case to cut,’ Dr Oliver said.

The US had a $US17.7billion goods trade surplus with Australia in 2023 which would now be worth $A28.2billion at the existing exchange rate under 63 US cents.

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