US President Donald Trump has refused to exempt Australia from tariffs on steel and aluminium coming into effect on Thursday (AEDT).

The White House confirmed Trump had decided that Australia would be hit with the 25 per cent tax on foreign imports to the US.

“He considered it, and considered against it. There will be no exemptions,” said White House spokeswoman Karoline Leavitt on Wednesday morning (AEDT).

Leavitt said the reason was to protect the US industry.

“American-first steel. And if they want to be exempted, they should consider moving steel manufacturing here,” she said.

Cabinet minister Clare O’Neil said there was still time.

“We’re still in a discussion with the US government about this,” she told the Seven Network.

“I’m not going to accept this as the situation yet.

“We still have a little bit of time and lots of discussions [are] continuing to happen.”

The tariffs, which apply to all steel and aluminium imports into the US, will take effect on Wednesday US time (Thursday AEDT).

Australia had argued it should get an exemption because it imports more from the US than it exports.

Ex-Liberal prime minister Malcolm Turnbull warned the chance of an exemption — like the one Australia enjoyed in Trump’s first term as president — was low because the administration had regrets over concessions granted in its first term.

Trump doubles tariffs

Meanwhile, Trump has ratcheted up his trade war with Canada by ordering a doubling of steel and aluminium tariffs to 50 per cent.

Trump said he was retaliating against the Canadian province of Ontario’s decision to slap 25 per cent tariffs on power delivered to states in northern US.

Canada’s move infuriated Trump, who vowed punishment with a financial price “so big that it will be read about in History Books for many years to come”.

“Can you imagine Canada stooping so low as to use ELECTRICITY, that so affects the life of innocent people, as a bargaining chip and threat?” posted Trump on Truth Social.

In response, Ontario’s Premier Doug Ford said “we will not back down” and called on Trump to “stop the chaos”.

However, Ford later said he had agreed to remove the electricity surcharge after a call from US Commerce Secretary Howard Lutnick.

Ford said he was confident Trump would also back away from his own plans for 50 per cent tariffs on Canadian steel and aluminium.

“By no means are we just going to roll over. What we are going to do is have a constructive conversation,” he said.

Australian Constructors Association chief executive Jon Davies said the looming tariffs meant uncertainty for the sector, which had been hit with material price rises after Covid and the war in Ukraine.

He said costs associated with steel products could rise because of the tariffs, which would affect construction prices.

“Any additional hit to the construction industry at this time will be extremely problematic,” he said on Tuesday.

“It has no contingencies left to weather any significant impacts or downturns.”

Global markets have been roiled since Trump sparked back-and-forth tariff moves against major trading partners such as Canada, Mexico and China.

The latest escalation and retreat in the ongoing trade war with Canada only compounded the rising sense of uncertainty in terms of how Trump’s tariff hikes will play out.

On Monday (US time), the S&P 500 had its most significant one-day drop since December 18, wiping out a staggering $US4 trillion ($6.4 trillion) from its recent peak.

Meanwhile, the tech-heavy Nasdaq confirmed a 10 per cent correction late last week.

“Every time we feel like we’re getting a little bit of a lift, we get a Trump update on more tariffs … it’s getting ugly and it’s going to hurt,” said Dennis Dick, a trader at Triple D Trading.

“International investors looking at all the political uncertainty in the North American markets are saying let’s invest elsewhere.”

In early trading on Tuesday, the Dow Jones Industrial Average fell 427.33 points, or 1.02 per cent, to 41,484.38, the S&P 500 lost 34.54 points, or 0.62 per cent, to 5,580.02, and the Nasdaq Composite lost 33.70 points, or 0.19 per cent, to 17,434.62.

All 11 S&P 500 subsectors fell, with cyclical stocks such as industrials and financials down about 1.0 per cent.

-with AAP