Australia ‘deeply concerned’ over new US tariff hit: Trade Minister Don Farrell

A new round of tariffs could be unleashed on April 2, but Trade Minister Don Farrell has vowed not to respond with retaliatory actions on the US.

Trade Minister Don Farrell told The Australian’s Global Food Forum that he was concerned about the prospect of a new wave of tariffs. Picture: Luis Enrique Ascui

Trade Minister Don Farrell said he was “deeply concerned” over the prospect of a new wave of food and pharmaceutical tariffs hitting Australian exporters, but vowed not to respond with retaliatory tariffs on the US.

Senator Farrell spoke with US Secretary of Commerce Howard Lutnick on Friday morning when he conveyed Australia’s disappointment on failing to win an exemption on steel and aluminium exports while also discussing the threat of additional tariffs from April 2.

“Deeply concerned because if you take what has been said by President Trump and the Americans, they are now looking at this reciprocal tariff arrangement,” Senator Farrell told The Australian and Visy Group’s 13th annual Global Food Forum in Melbourne on Friday.

“Our argument is the US has a trade deficit with Australia as far as we are concerned. We now need to prosecute this argument.”

Asked if he is seeking an exemption from reciprocal tariffs, Senator Farrell said he is seeking “the application of our fair trade agreements” with the US. That entails Australia not imposing tariffs on them “and they don’t charge tariffs on us”.

A further call with US Trade Representative Jamieson Greer is scheduled on Tuesday Australian time.

“Will it be successful? Well the point has been made Trump mark two is not the same as Trump mark one. So it’s a more difficult conversation,” Senator Farrell said.

Former Labor minister Bill Shorten said on Friday that Australia should “reciprocate dollar for dollar” if US President Donald Trump keeps slapping trade tariffs on Australian goods, declaring that the nation “cannot be pushed around”.

However, the trade minister said it was not the favoured approach.

“Some people have said, ‘Let’s retaliate against the United States, let’s start proposing tariffs now’,” Senator Farrell told the Forum.

“As tempting as that might be … I don’t think it’s the way to resolve these outstanding issues. And I think a sensible collective approach, the way that we connected with China, is the way we need to deal with these issues. And certainly that’s the policy to adopt.”

While an initial attempt to use Australia’s vast reserves of critical minerals as a bargaining chip was rejected by the US administration, Australia will keep pushing for a mining deal to remain on the table.

“We don’t give up. There were plenty of times in the last three years when we didn’t look like we were making progress with China and we could have thrown up our hands and said we are wasting our time. Our arguments are not having any impact and we’re not going to get the removal of these tariffs. But we did get it with barley. So we shouldn’t panic in this situation.”

The failure to win an exemption of steel and aluminium tariffs “was a bad result and there’s no getting away from that”, Senator Farrell said.

“We’ve got to keep talking to them. We need to find what the solution is here.”

Ambassador Kevin Rudd laid out the government’s critical minerals plan to Mr Lutnick in multiple meetings ahead of Mr Trump’s tariff decision on Wednesday, and was encouraged by the response. It proposed a guaranteed supply chain of processed minerals and investment funds for new projects.

US President Donald Trump did not spare Australia from steel and aluminium tariffs. Picture: AFP

Senator Farrell earlier pledged to protect Australia’s $75bn food export industry including beef, wine and agriculture supplies to the US amid fears an April 2 reciprocal tariffs announcement could deepen the trade spat with meat and pharmaceuticals in the firing line.

“Most of the beef that we sell into the United States goes into McDonald’s hamburgers – Mr Trump’s favourite food I’m told,” Senator Farrell said.

The minister also noted it was not entirely clear what the relationship between Mr Lutnick and Mr Greer was under the new Trump administration.

“In the Biden government, you had Gina Raimondo as Commerce Secretary and Katherine Tai working independently. There was the suggestion at the start of the Trump administration that Mr Lutnick would have a greater role in this trade space. Whether Mr Greer or Mr Lutnick, we’ll keep talking.”

Senator Farrell said “part of my job will be to convince them (the US) that this is not the right way to go”. “The path … is free and fair trade,” he said.