Australia is the winner of the tariff war – Australian beef, wine and wheat may be cheaper in the US market

Political gesture or commercial reality?

Australian Trade Minister Don Farrell welcomed the low tariffs and said the government would provide all support to exporters to take advantage of the new opportunities. Reuters said the decision was not unrelated to Prime Minister Anthony Albanese’s recent easing of import restrictions on US beef, although the government did not link this to the tariff negotiations.

Australia has restricted imports of American beef since 2003, citing mad cow disease, and since 2019, only meat from animals born and slaughtered in the US has been allowed. With last week’s decision, meat that came to the United States from Canada or Mexico, but was also processed there, has been given the green light.

Not only tariffs: the trade balance also matters

Trump’s decision may also be due to the fact that the United States does not suffer a foreign trade deficit with Australia: in 2024, it exported goods worth $34.6 billion to Australia, while imports from there amounted to only $16.7 billion. The US president has repeatedly stated that he would primarily punish countries with tariffs that accumulate a trade surplus with the US.

Australian beef exports at record levels

The Australian beef industry is not afraid of a 10 percent tariff: exports to the United States set a record, reaching an average monthly value of $275 million in the first half of the year. The low tariff burden therefore does not pose a significant obstacle to competitiveness – especially given that main rival New Zealand is subject to a 15 percent tariff.