While the Case Studies Database on this site focusses on the period up to December 2024, the Economic Statecraft and Weaponised Trade project has a broader focus. This post by Dr Chris Khatouki provides an overview of the Australia-US tariff situation as at November 2025, as the end of the first year of the second Trump admnistration draws towards a close. See also Part II of this series on non-trariff measures.

Context:

Baseline Tariffs

Effective 9 April 2025, the U.S. government under the Trump administration imposed a 10 percent baseline tariff on all global imports under the authority of the 1977 Emergency Economic Powers Act (IEEPA). From 29 August 2025, the U.S. also suspended a de minimis exemption on the baseline tariff for low-value goods.

This applies to most goods originating from Australia, including Australia’s external territories such as the Heard and McDonald Islands. However, Norfolk Island is currently subject to a 29% tariff, 19% higher than the rest of Australia.

Steel, Aluminium, Copper and Automobiles

Under the first Trump administration, in March 2018, the U.S. announced blanket tariffs of 25% on all steel and 10% on aluminium imports on national security grounds under Section 232 of the 1962 Trade Expansion Act. After sustained high-level diplomacy, Australia was granted an exemption from the tariffs at the time.

However, in March 2025, under the second Trump administration, the U.S. terminated all prior exemption agreements. Australian steel and aluminium exports are now subject to a 50% tariff, which has been expanded to include certain derivative products. Automobiles, light trucks, and certain automotive parts are subject to a 25% tariff. Furthermore, some copper and copper-containing products are also subject to a 50% tariff.

Washing Machines and Solar Panels

In January 2018, the first Trump administration announced it would impose “safeguard” tariffs under Section 201 of the 1972 Trade Act at 30% on solar cells and module imports. Imports of large residential washing machines were also targeted under a 20-50% tariff depending on quota tiers. Australia was not excluded from these measures, despite the existing carve out deal for steel and aluminium. The proclamation was extended to the 7 February 2023 under the Biden administration, however, it has not been renewed at the time of writing.

Despite Australia not being a major exporter to the U.S. of these products, the decision to not provide an exemption indicated that Australia’s status as an FTA partner, and close security ally, may not protect it from U.S. protectionist measures going forward.

Wood and Derivative Products

From October 14 2025, softwood timber and lumber imports into the U.S. became subject to a 10% tariff rate. Kitchen cabinets and vanities are subject to 25% tariffs, which will rise to 50% on 1 January 2026. A 25% tariff on upholstered wooden furniture will also increase to 30% unless new trade agreements are reached. These measures are made under the authority of Section 232 of the 1962 Trade Expansion Act.

Impacts:

Australian steel and aluminium exports to the US represent less than 0.2% of the total value of Australian exports as of 2024. In 2024, Australia’s wood and wood products were at a deficit with the U.S. worth AUD 84.2 million, with exports to the US accounting for just 0.5% of total  Australian wood and wood product exports by value. Furthermore, less than 1% of total Australian copper exports are destined for the U.S.. This means that there are no substantial direct impacts from the existing tariff regime on Australia.

In fact, some analysis seems to suggest that U.S. global tariffs may have a moderate long-term net benefit to the Australian economy. Given that Australia is at the bottom of the global tariff scale imposed by the U.S., Australian business may see an increase of sales to key markets, such as China, capturing lost demand from declining U.S. trade. This also includes the ability for Australia to strengthen its position in critical minerals and copper supply chains.

Nevertheless, recent economic modelling by the International Monetary Fund (IMF) highlights a significant slowdown in overall global economic growth from the current U.S. tariff regime, which will hit major economies including Australia.

Responses:

The US government has defended the baseline 10 percent tariff on Australia, despite pre-existing agreements under the US–Australia Free Trade Agreement (AUSFTA). US Trade Representative (USTR) Jamieson Greer claimed the tariffs were a response to Australia banning US beef and pork exports and said the U.S. “should be running up the score on it”. President Trump also appeared to reaffirm this reasoning, singling out alleged Australian restrictions on U.S. beef: “Australia bans – and they’re wonderful people, and wonderful everything – but they ban American beef.”

Then federal Industry Minister, Ed Husic, described the tariffs on aluminium and steel as a “dog act after over a century of friendship”. Prime Minister Anthony Albanese used less confrontational language, describing the measures as “not a friendly act” and “a form of economic self-harm”. He indicated that Australia may use dispute-resolution powers under the AUSFTA in response to the 10 percent baseline tariffs on Australian exports. This followed previous considerations of taking the U.S. to the World Trade Organisation for arbitration.  

However, at the time of writing, Australia has not imposed or announced any reciprocal measures, arguing that doing so would trigger a “race to the bottom”. In July 2025, Australia officially lifted biosecurity import controls on US beef after a review determined that U.S. safety standards had improved. The federal government maintains that this decision on beef imports was made independently from tariff pressures.

The Australian federal government has also pursued measures to support domestic industries. In April 2025, it announced AUD 1 billion in zero interest loans to help export-focused companies access alternative markets. In September 2025, a AUD 50 million dollar fund was established to assist Australian exporters in entering new markets under a new Accessing New Markets Initiative (ANMI). The government also stated that it was brining Australian businesses to the “front of the queue” for approximately 31,000 Australian government procurement contracts.

Furthermore, the government is working to strengthen anti-dumping rules to prevent tariff-affected foreign steel, aluminium, and related products from undercutting local industries. It has also sought to reduce reliance on traditional export channels and increase value-added production. This is evident in the United States‑Australia Framework for Securing Supply in the Mining and Processing of Critical Minerals and Rare Earths, signed on 21 October 2025.

Reference List (Part 1):

ABC News, “Labour frontbencher calls US tariffs a ‘dog act’”. March 12. Available at: https://www.abc.net.au/news/2025-03-12/labor-frontbencher-calls-us-tariffs-a-%E2%80%98dog-act%E2%80%99/105043406

Albanese, A. 2025. “Press Conference – Sydney”. Office of Prime Minister and Cabinet. March 12. Available at: https://www.pm.gov.au/media/press-conference-sydney-23

Albanese, A. 2025. “Statement on United States tariffs”. Office of Prime Minister and Cabinet. March 12. Available at: https://www.pm.gov.au/media/statement-united-states-tariffs

Albanese, A. 2025. “Statements on USA tariffs”. Australian Labor Party Canberra. April 3. Available at: https://alp.org.au/news/statement-on-usa-tariffs/

Barich, A. 2025. “Australia eyes stronger aluminium, steel antidumping rules against US tariffs”. S&P Global. April 7. Available at: https://www.spglobal.com/commodity-insights/en/news-research/latest-news/metals/040725-australia-eyes-stronger-aluminum-steel-antidumping-rules-against-us-tariffs

Brann, M. 2025. “Agriculture department confirms US beef not banned in Australia” ABC News. April 6. Available at: https://www.abc.net.au/news/2025-04-06/trump-claims-australia-bans-american-beef-imports-incorrect/105139686

Cameron, A. 2025. “Monday Briefing: New Commonwealth Procurement Rules”. The Mandarin. October 27. Available at: https://www.themandarin.com.au/301684-monday-briefing-new-commonwealth-procurement-rules/

Commonwealth of Australia. 2025. “$50 million to help Australian exporters access new export markets”. 17 September 2025. Available at: https://export.business.gov.au/news-and-events/news-and-updates/50-million-to-help-australian-exporters-access-new-export-markets

Department of Foreign Affairs and Trade. 2025. “Latest on US tariffs: What has changed”, Commonwealth of Australia. Available at: https://www.dfat.gov.au/trade/trade-and-investment/latest-us-tariffs

Department of Industry, Science and Resources. 2025. “United States-Australia Framework for Securing of Supply in the Mining and Processing of Critical Minerals and Rare Earths”. Commonwealth of Australia. October 21. Available at: https://www.industry.gov.au/publications/united-states-australia-framework-securing-supply-mining-and-processing-critical-minerals-and-rare-earths

Dziedzic, S. 2025. “Labor prepares to challenge Trump administration at World Trade Organization over tariffs”. ABC News. April 2. Available at: https://www.abc.net.au/news/2025-04-02/government-could-challenge-trump-at-world-trade-organisation-/105127142

Evans, J. “Albanese threatens to use ‘dispute resolution’ powers against sweeping US tariffs, ABC News. April 3. Available at: https://www.abc.net.au/news/2025-04-03/election-2025-albanese-responds-trump-tariffs-beef/105130768

Evans, J. 2025. “Australia lifts biosecurity import restrictions on US beef”. ABC News. July 24. Available at: https://www.abc.net.au/news/2025-07-24/beef-biosecurity-import-restrictions-administration-tariff/105563752

Forest & Wood Products Australia. 2025. “Wood & Wood Products Trade with USA”. April 13.  Available at: https://fwpa.com.au/news/tariffs-in-context-australias-wood-wood-products-trade-with-usa/

Hordern, N., Gadsby, P., Murphy, C., Huynh, P., Gronsbell-Luntz, J, 2025. “Australia set for moderate long-term benefit from the trade war”. EY Oceania. October 7. Available at: https://www.ey.com/en_au/insights/economics/australia-set-for-moderate-long-term-benefit-from-the-trade-war

International Monetary Fund. 2025. “World Economic Outlook: Global Economy in Flux, Prospects Remain Dim”. October 22. Available at: https://www.imf.org/en/publications/weo/issues/2025/10/14/world-economic-outlook-october-2025

Li, Y. 2025. “Donald Trump’s trade chief Jamieson Greer doubles down on US tariffs on Australia”. ABC News. April 9. https://www.abc.net.au/news/2025-04-09/us-trade-presentative-defends-trumps-tariff-on-australia/105154814

Lyons, K. and Evershed, N. 2025. “‘‘Nowhere on Earth is safe’: Trump imposes tariffs on uninhabited islands near Antarctica”. The Guardian. Available at: https://www.theguardian.com/us-news/2025/apr/03/donald-trump-tariffs-antarctica-uninhabited-heard-mcdonald-islands

Norman, J. 2018. “Donald Trump, Malcolm Turnbull hit on deal to exclude Australia from new US tariffs, ABC News. March 10. Available at: https://www.abc.net.au/news/2018-03-10/malcolm-turnbull-donald-trump-working-tariff-exemption-agreement/9534984

The White House. 2024. “A Proclamation To Further Facilitate Positive Adjustment to Competition From Imports of Certain Crystalline Silicon Photovoltaic Cells (Whether or Not Partially or Fully Assembled Into Other Products)”. June 21. Available at: https://bidenwhitehouse.archives.gov/briefing-room/presidential-actions/2024/06/21/a-proclamation-to-further-facilitate-positive-adjustment-to-competition-from-imports-of-certain-crystalline-silicon-photovoltaic-cells-whether-or-not-partially-or-fully-assembled-into-other-products/

The White House. 2025. Fact Sheet: President Donald J. Trump Declares National Emergency to Increase our Competitive Edge, Protect our Sovereignty, and Strengthen our National and Economic Security. April 2. Available at: https://www.whitehouse.gov/fact-sheets/2025/04/fact-sheet-president-donald-j-trump-declares-national-emergency-to-increase-our-competitive-edge-protect-our-sovereignty-and-strengthen-our-national-and-economic-security/

The White House. 2025. Presidential Actions: Suspending Duty-Free De Minimis Treatment For All Countries. July 30. Available at: https://www.whitehouse.gov/presidential-actions/2025/07/suspending-duty-free-de-minimis-treatment-for-all-countries/

Trump, D.J. 2018. “Proclamation 9711 of March 22, 2018: Adjusting Imports of Steel into the United States”. Federal Register, National Archives and Records Administration. Available at: https://www.federalregister.gov/documents/2018/03/28/2018-06425/adjusting-imports-of-steel-into-the-united-states

Trump, D.J. 2025. “Proclamation 10976 of September 29, 2025: Adjusting Imports of Timber, Lumber, and Their Derivative Products Into the United States”. National Archives and Records Administration. Available at: https://www.federalregister.gov/documents/2025/10/06/2025-19482/adjusting-imports-of-timber-lumber-and-their-derivative-products-into-the-united-states

United States Trade Representative. 2018. “President Trump Approves Relief for U.S. Washing Machine and Solar Cell Manufacturers”, Executive Office of the President, January 22. Available at: https://ustr.gov/about-us/policy-offices/press-office/press-releases/2018/january/president-trump-approves-relief-us

Weaver, M. 2018. “Special Topic: Section 232 and 301 Trade Actions in 2018”. United States International Trade Commission. Available at: https://www.usitc.gov/research_and_analysis/trade_shifts_2018/special_topic.htm

Webb, M. 2025. “Trump’s copper tariff creates export opportunity for Australia”. Mining Weekly. July 10. Available at: https://www.miningweekly.com/article/trumps-copper-tariff-creates-export-opportunity-for-australia-2025-07-10