US steel and aluminium tariffs threaten Australian industry, MCA warns

With hopes of a reprieve from President Donald Trump’s proposed steel and aluminium tariffs having run into a major roadblock, the Minerals Council of Australia (MCA) says the move is set to have significant implications for the Australian industry.

The US president signed executive orders earlier this week that will see 25% taxes placed from 12 March on all imports of steel and aluminium into the US.

Prime Minister Anthony Albanese’s recent phone conversation with his US counterpart seems to have had little effect, with reports overnight that one of President Trump’s senior advisers has played down any hope of Australia receiving special dispensation in the matter and accused Australia of “killing the aluminium market.”

Critical sectors

MCA chief executive Tania Constable has been pleading the local industry’s case with the Department of Foreign Affairs and Trade, as well as Australian agencies in Washington.

Ms Constable said steel and aluminium are not just key to industrial production but critical to defence, technology and advanced manufacturing.

“Aluminium production, in particular, plays a vital role in securing minerals like gallium and germanium, which are essential to power modern technologies.”

“Action is needed now to ensure that trade restrictions do not expand to critical minerals and other resources that are vital to Australia’s economic future and global supply chains.”

Policy change needed

Ms Constable said the US move had highlighted the importance of the Australian government taking immediate and decisive action to put in place the policies needed to secure the future of some of the nation’s most important industries.

“While our competitors are cutting costs and attracting investment, Australian industry is being weighed down by policies that make it harder to invest, expand and compete,” she said.

“Australia has long been a reliable and trusted supplier of these materials to the world and our strong trade and defence relationship with the United States has underpinned decades of economic and strategic cooperation.”

“It is vital that this partnership continues, ensuring stable supply chains and mutual benefit for both nations.”

UK dissatisfaction

Australia is not the only nation upset by the new tariff proposal, with UK Steel director general Gareth Stace accusing Mr Trump of “taking a sledgehammer to free trade” in a move that has huge ramifications for the steel sector in the UK and across the world.

The new tariffs are expected to cancel out previous quota arrangements and exemptions, including for the UK and EU.

Product-specific exemptions for steel not made in the US have also been scrapped and the tariffs now extend to derivative products, with only steel “melted and poured” in the US but processed elsewhere remaining exempt.

Stronger action

“UK steel poses no threat to US national security,” Mr Stace said, urging the UK government to take stronger action on these issues.

“Our high-quality products serve key US industries, many of which cannot source these domestically.”

“This is a moment where our countries should work together to tackle global steel overproduction, not be at loggerheads.”