Trump's steel, aluminum tariffs take effect as trade war intensifies

US President Donald Trump's increased tariffs on all US steel and aluminum imports took effect on Wednesday, stepping up a campaign to reorder global trade norms in favour of the US that drew swift retaliation from Europe.

Trump's action to bulk up protections for American steel and aluminum producers restores effective global tariffs of 25 per cent on all imports of the metals and extends the duties to hundreds of downstream products made from the metals, from nuts and bolts to bulldozer blades and soda cans.

The European Commission responded almost immediately, saying it would impose counter tariffs on 26 billion euros ($102 billion) worth of US goods from next month.

Close US allies Canada, Britain and Australia criticised the blanket tariffs, with Canada mulling reciprocal actions and British Business and Trade Secretary Jonathan Reynolds saying "all options were on the table" to respond in the national interest.

Australian Prime Minister Anthony Albanese said the move was "entirely unjustified ... and against the spirit of our two nations' enduring friendship" but ruled out tit-for-tat duties.

"Tariffs and escalating trade tensions are a form of economic self-harm, and a recipe for slower growth and higher inflation. They are paid by the consumers," Albanese told reporters.

The countries most affected by the tariffs are Canada, the biggest foreign supplier of steel and aluminum to the US, Brazil, Mexico and South Korea, which all have enjoyed some level of exemptions or quotas.

The runup to the tariff deadline came with some drama on Tuesday as Trump threatened Canada with doubling the duty to 50 per cent on its steel and aluminum exports to the US.

But Trump backed off those plans after Ontario Premier Doug Ford agreed to suspend his province's decision to impose a 25 per cent surcharge on electricity exports to the states of Minnesota, Michigan and New York until earlier US tariffs were removed.

Ford said he would fly to Washington on Thursday with Canadian Finance Minister Dominic LeBlanc for talks with Commerce Secretary Howard Lutnick and other Trump officials to discuss revising the US-Mexico-Canada Agreement on trade.

The incident whip-sawed US financial markets already jittery over Trump's broad tariff offensive, but left unchanged Trump's original plans to strengthen the Section 232 national security tariffs on steel and aluminum imposed in 2018 during his first term.

A White House spokesperson described the US pressure on Canada as a "win" for the American people.

The US Customs and Border Protection agency cut off imports qualifying for duty-free entry under quota arrangements well before the midnight deadline, saying in a bulletin to shippers that quota paperwork needed to be processed by 4:30 p.m. local time on Tuesday at US ports of entry or the full tariffs would be charged.

The move was welcomed by US steel producers as restoring Trump's original 2018 metals tariffs that had been weakened by numerous country exclusions and quotas and thousands of product-specific exclusions.