US President Donald Trump has said a 25 per cent tariff on steel imports and 10 per cent on aluminium will come into effect in 15 days, but will not initially include Canada and Mexico.

Key points: President says Australia is a "great country, a long-term partner"

President says Australia is a "great country, a long-term partner" Greg Norman among those who signed a letter urging Mr Trump to consider a tariff's impact on the Australian-US relationship

Greg Norman among those who signed a letter urging Mr Trump to consider a tariff's impact on the Australian-US relationship Mexico, Canada also under consideration to be exempt from tariff

Flanked by steel and aluminium workers and members of his Cabinet, Mr Trump also said he was still working through which other countries may be excluded but assured "great flexibility and cooperation to those who are really friends of ours".

Earlier, and after a week of uncertainty and furious lobbying by Canberra, Mr Trump gave a strong indication Australia may be excluded.

Describing the dumping of steel and aluminium in the US as "an assault on our country", Mr Trump told a news conference the best outcome was for companies to move to the US and insisted that domestic production was needed for national security reasons.

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"If you don't want to pay tax, bring your plant to the USA," he said.

Details of the plan came from a briefing by administration officials ahead of Mr Trump's speech.

Other countries can apply for exemptions, according to the administration, although details of when they would be granted were thin.

Speaking earlier at a Cabinet meeting at the White House, Mr Trump singled out Australia when he said he may exempt countries with which the US has good trade and military relationships.

"We will be making a decision as to who they are — we have a very close relationship with Australia," he said.

He described Australia as "a great country, a long-term partner" and said "we will be doing something with them".

Sorry, this video has expired Donald Trump suggests Australia may be exempt from tariffs

The comments come after furious lobbying by Australian officials and business leaders, who have been trying to convince the Trump administration to reverse course.

Australia reacts

Prime Minister Malcolm Turnbull said there was no case for the US imposing tariffs on Australian steel.

He said Australia would be relentless about making the case against the duties.

Mr Turnbull welcomed the way Mr Trump had recognised that Australia was a strong ally of the US and that America has a large trade surplus with Australia.

"He expressly acknowledged the points we have made about the important relationship with Australia, the very strong friendship and of course the fact America has a surplus in its trade with Australia," Mr Turnbull said.

Opposition Leader Bill Shorten said he was optimistic Australia would be exempt from the tariffs.

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But he warned the Government needed to introduce tougher penalties for companies found dumping cheap steel in Australia.

Mr Shorten said the Commonwealth's anti-dumping commission needed more authority to punish overseas companies who try to sell their product into Australia at below cost, as a result of the tariffs.

"The idea that jurisdictions where they're currently making steel and aluminium, the idea that if they can't ship it to America they'll just sit at home and do nothing, that is negligent attitude," he said.

"The policy we are putting forward today just recognises the way the world is since President Trump has said that he's going to put new taxes and charges on steel and aluminium going to America.

"We've got to make sure the penalties are in place so that everyone dealing with Australia, plays by the rules."

Golfing great — and personal friend of the President — Greg Norman joined key business figures in signing a letter urging Mr Trump to change his mind.

"We respectfully request that your economic team consider the historic trade surpluses, our $1.29 trillion two-way trade between the United States and Australia, and our critical defence relationship before taking any action that might have demonstrable negative impact on the mutually beneficial American-Australian bilateral relationship," the letter dated March 7 read.

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The letter, sent by the American Australian Business Council, was also signed by the chief executive of News Corporation, Robert Thomson, the chief executive of Dow Chemical, Andrew N Liveris, and former US ambassador to Australia John Berry.

"Fingers crossed on what is hopefully a happy ending," Mr Berry said in a statement after Mr Trump's comments.

Foreign Minister Julie Bishop said Australian diplomats in Washington were lobbying for Australia to be exempt.

"We are all over it," Ms Bishop told AM.

"We are focusing very much on gaining an exemption and that is what all our efforts have been directed to from the Prime Minister to the Trade Minister, all our officials, all our diplomats and that is what I have been doing here in New York."

Republicans and US trading partners have also been urging Mr Trump to reconsider his plan to impose a blanket 25 per cent tariff on steel imports, and a 10 per cent on aluminium.

During the Cabinet meeting, Mr Trump also promised to be "very flexible" with the tariffs.

He said he was considering exempting Mexico and Canada too, provided the US got a good deal in the renegotiation of the North American Free Trade Agreement (NAFTA).

Asia-Pacific countries sign sweeping trade deal without US

Sorry, this video has expired Ministers from 11 countries sign the TPP free trade agreement

Mr Trump's tariff move has sparked talk of a global trade war should other economies retaliate with similar protectionist policies.

But in separate development and a rebuke to protectionism, 11 countries including Australia, Japan and Canada signed a landmark Asia-Pacific trade agreement without the United States.

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will reduce tariffs in countries that together amount to more than 13 per cent of the global economy — a total of $13 trillion in gross domestic product.

With the United States, it would have represented 40 per cent.

Chile's Foreign Affairs Minister Heraldo Munoz said the agreement was a strong signal "against protectionist pressures, in favour of a world open to trade, without unilateral sanctions and without the threat of trade wars".

"We will be giving a very powerful signal," he said at a news conference after giving a joint statement with other trade ministers.

The original 12-member agreement, known as the Trans-Pacific Partnership (TPP), was thrown into limbo early last year when Mr Trump withdrew from the deal three days after his inauguration.

He said the move was aimed at protecting US jobs.

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