The imposition of tariffs on Australian exports to the US is a deeply concerning move that will hurt Australian exporters and drive up costs for American consumers.
President Trump's decision is a stark reminder of the disruptive consequences that can arise from trade volatility and economic uncertainty.
And while details remain unclear, this development further reinforces the need for Australia to get the economic fundamentals right to protect and enhance our global competitiveness; to better position ourselves in times of economic uncertainty. It also underscores the need for Australia to accelerate free trade deals and secure supply chain partnerships with like-minded economies.
Australia has long been a reliable and trusted global supplier of minerals and critical materials, with our enduring trade and defence partnership with the United States forming the backbone of decades of economic and strategic collaboration.
These trade tariffs undermine this crucial alliance, destabilising supply chains and increasing costs to consumers. It is a race to the bottom.
While the baseline tariff on Australian exports is across the board, certain minerals may be exempt, with further clarification from the Trump Administration required.
The tariff edict states that copper, pharmaceuticals, semiconductors, bullion, and lumber articles will be exempt, as well as "energy and other certain minerals that are not available in the United States", which is likely to include a range of critical minerals and uranium.
This is particularly important for Australian gold, with exports to the US hitting $4.6 billion in January 2025, over 85 per cent of total gold exports.
The MCA also notes the Federal Government's announcement to establish a critical minerals strategic reserve, in response to the tariff imposition.
While the details remain unclear, this proposal presents significant risk for investors and miners alike.
The purpose of a strategic reserve is to manage supply security and price stability for those that use critical minerals. Investors in mining, processing and manufacturing, take decisions based on commercial and economic signals.
Adding this domestic political risk to the numerous hurdles that miners already face in getting projects off the ground or maintaining the viability of their operations, will only decrease Australia's competitiveness and undermine the very investment we need to meet the world's demand for our critical minerals.
Without the ability to process them, stockpiling raw materials serves no benefit.
