Australia will not retaliate despite Donald Trump’s “wrong” tariff hike decision on steel imports.

Trump plans to increase tariffs on foreign steel from 25 to 50 per cent to “further secure the steel industry in the United States”.

The move could impact 100,000 Australian jobs, with the sector exporting more than $414 million worth of products to the US in 2024.

Trade Minister Don Farrell is calling on the Trump administration to reverse the decision and drop all tariffs on Australian steel and aluminium.

“This will simply push up the price for consumers in the United States and do nothing for the prosperity of both of our nations,” he told reporters on Saturday.

Farrell said the government would work with the US but reiterate the view that tariffs were “the wrong course of action” and “don’t do what President Trump claims they will do”.

“We don’t believe that retaliation is the right way to go here,” he said.

“We’re going to cooly and calmly argue our case for the removal of these tariffs.”

Opposition trade spokesman Kevin Hogan said Trump’s call was concerning for Australian jobs.

“The Albanese government needs to double its efforts to protect our steel industry and local jobs for our steel workers,” he said.

“This is why it is imperative that the Australian prime minister personally meets with President Trump … to develop a personal rapport with the United States president and protect Australian industries.”

The industry’s peak body says it will continue to work with the federal government to push for an exemption from the Trump administration.

“The subsequent disruptions to global steel trade could see Australia become a dumping ground for imported steel,” Australian Steel Institute chief executive Mark Cain said.

“And it could exacerbate the surge in imported low-priced steel that is damaging the industry.”

It took Australia nine months of lobbying before it secured a tariff exemption during Trump’s first administration.

The US imported 289 product categories in 2024, costing $US147 billion ($229 billion), with nearly two-thirds of those aluminium and one-third steel, according to Census Bureau data from the US International Trade Commission.

The 25 per cent tariffs on steel and aluminium were among the earliest implemented following Trump’s return to the White House in January and came into effect in March.

The latest tariff hike comes after a US federal court blocked the president’s Liberation Day taxes on imported goods from going into effect.

Goods from Australia are subject to a 10 per cent baseline tariff, while all steel and aluminium imports to the US face 25 per cent tariffs before Trump’s latest announcement.

The New York-based Court of International Trade found the US president had overstepped his authority by imposing the tariffs.

The administration has launched an appeal, decrying “unelected judges” should not decide how to address a “national emergency”.

EU threat

The European Union has spoken out against US President Donald Trump’s latest tariff announcement on steel imports and has threatened countermeasures.

“We strongly regret the announced increase of US tariffs on steel imports from 25 per cent to 50 per cent,” said a spokesman for the European Commission in Brussels, which is responsible for EU trade policy.

“This decision adds further uncertainty to the global economy and increases costs for consumers and businesses on both sides of the Atlantic.”

The EU is ready to take countermeasures, the statement continued.

This could also happen earlier than July 14.

As things currently stand, EU counter-tariffs already planned due to Trump’s initial tariff decisions would automatically come into force on this date.

The bloc had wanted the measures to come into force on April 14, but held back after Trump granted many countries and the EU a 90-day pause from certain tariffs.

This window of opportunity had been intended to be used for negotiations.

The EU has repeatedly emphasised that it will introduce decisive measures against US tariffs if the talks fail.

Early last week, European Union Commission President Ursula von der Leyen expressed some optimism about sorting out the trade dispute, following a phone call with Trump.

But now it appears all bets could be off.

He added that tariffs were his absolute favourite word.

Trump’s administration has justified the existing steel tariffs as a measure to protect national security.

He has already announced, threatened or implemented numerous other tariffs.

In addition to a new penalty tariff of 10 per cent of the value of goods on almost all imports, he has announced specific, higher tariffs on imports, including from major trading partners such as China and the European Union.

New German Chancellor Friedrich Merz will meet US President Donald Trump at the White House in Washington on Thursday.

This is the first meeting between the two since Merz took office on May 6.

Before that, they had only briefly encountered each other many years ago in New York.

The trade dispute between the United States and the European Union is likely to be a hot button issue.

Unlike the EU, Australia will not retaliate against Trump’s “wrong” tariff hike decision on steel imports.

Trade Minister Don Farrell is calling on the Trump administration to reverse the decision and drop all tariffs on Australian steel and aluminium.

“We don’t believe that retaliation is the right way to go here,” he said.

“We’re going to cooly and calmly argue our case for the removal of these tariffs.”

—AAP