Trade Minister urges steel and aluminium exporters to target Asia as US tariffs loom
Australia is actively exploring alternative markets in Asia as it braces for the impact of potential tariffs on its steel and aluminium exports imposed by US President Donald Trump. With hopes of securing an exemption from these tariffs fading, Trade Minister Don Farrell has encouraged exporters to focus on regions such as Japan, South Korea, India, and Southeast Asia.
Each year, Australia exports approximately A$1 billion worth of steel and aluminium to the United States, making it a significant destination for Australian exports. However, if the tariffs come into effect, expected on March 12, the government is already preparing for the possible consequences. Farrell has met with industry leaders to discuss diversifying Australia’s export markets, with assistance from the Australian Trade and Investment Commission and the Department of Foreign Affairs and Trade.
The US remains Australia’s largest market for steel and third-largest for aluminium, but Farrell remains optimistic, taking a “calm, persistent” approach to advocate for Australia’s interests in Washington. Meanwhile, Australia is also looking to strengthen economic ties with Southeast Asia and India through various initiatives to expand trade opportunities.
While South Korea and Japan are already major importers of Australian aluminium, the US purchases about 20% of Australia’s steel exports. Other emerging markets include Bangladesh, India, and Vietnam. Australia’s reliance on the US market makes the proposed tariffs a contentious issue, especially given the political implications for Prime Minister Anthony Albanese, who faces an election due by May.
Although the tariffs are unlikely to severely harm the Australian economy, there are concerns about the potential for other countries to flood the market with cheaper metals, prompting the government to consider tightening anti-dumping measures.
Efforts to secure an exemption have not yet succeeded. The Albanese government is under pressure from opposition leader Peter Dutton, who has called for more direct action with the US to secure an exemption, pointing to former Prime Minister Malcolm Turnbull’s successful negotiation in 2018.
Despite efforts from key Australian officials, including Ambassador Kevin Rudd, it appears that the likelihood of an exemption is low. The Australian Steel Institute and the Aluminium Council are continuing to assess the impact of the tariffs while collaborating with the government on potential strategies.
