Will Trump go easy on Australian & Japanese aluminium and steel? Tariff talks heat up!

The newly re-elected President of the United States of America, Donald Trump, on February 10, 2025, signed executive orders to enforce a 25 per cent tariff on aluminium and steel imports starting March 12, 2025, under Section 232 of the Trade Expansion Act of 1962, escalating a long-anticipated trade war despite warnings from Europe and China.

The orders eliminate specific exemptions from the duties, broaden their coverage to include more products and increase the tariffs on applicable aluminium goods from 10 per cent to 25 per cent. President Trump implemented Section 232 duties on steel and aluminium products in 2018, during his first term in office. The European Union promptly pledged to respond with decisive and proportionate countermeasures.

Australian media reported that US President Donald Trump is considering a tariff exemption for Australian steel and aluminium exports following a call with Australian Prime Minister Anthony Albanese. But if the exemption is not granted, what does the US tariff mean for the Australian mining industry?

The tariffs imposed by the Trump administration will affect every country exporting steel and aluminium to the U.S., including Australia. Tania Constable, CEO of the Minerals Council of Australia, stated that these tariffs could profoundly affect the Australian industry.

“Steel and aluminium are not just key to industrial production but are critical to defence, technology, and advanced manufacturing supply chains,” Constable.

“These proposed tariffs set a concerning precedent. Action is needed to ensure that trade restrictions do not expand to critical minerals and other resources vital to Australia’s economic future and global supply chains.”
 

As he signed the order, Trump initially asserted that his tariffs would have "no exceptions and no exemptions." However, he later clarified that he was giving "great consideration" to whether Australia should be included.

Source: US Department of Commerce

In 2024, Australia exported 223,000 tonnes of steel and 83,000 tonnes of aluminium to the United States. Australia's industry minister said on February 12, 2025, the nation's plan to boost "green" aluminium exports would not be derailed by the threat of U.S. tariffs, saying American customers would only end up paying more for a product in global demand.

On February 12, 2025, Japan's Industry Minister, Yoji Muto, announced that the country has formally requested an exemption from U.S. steel and aluminium tariffs. Chief Cabinet Secretary Yoshimasa Hayashi confirmed that the request was submitted through the Japanese Embassy in the United States.

Japan's Prime Minister Shigeru Ishiba, who met with Trump a few days ago, stated in parliament, "We will take necessary measures, including lobbying the United States for an exemption, while closely monitoring any possible impact on the Japanese economy."

            United States imports from Japan: Aluminium bars, rods, & profiles (value in USD Millions)

Source: United Nations COMTRADE database on international trade

Under Joe Biden's administration, several U.S. trading partners, including Japan, were granted duty-free quotas. Starting in April 2022, Japan's annual quota was set at 1.25 million tonnes, and any shipments exceeding this limit were subject to tariffs.