The White House said Trump was expected to make a final announcement by the end of the week and officials were working to include language in the tariffs that would give Trump the flexibility to approve exemptions for certain countries.
"There are potential carve-outs for Canada and Mexico based on national security - and possibly other countries as well, based on that process", Sarah Sanders said during her daily media briefing.
But the move risks retaliatory measures against United States exports and further complicates efforts to save the North American Free Trade Area (NAFTA).
Australian government ministers have been urgently lobbying for exemptions since President Donald Trump last week announced the 25 per cent tariff on steel and 10 per cent tariff on aluminium but have been generally pessimistic about the likelihood of special treatment.
The European Union threatened to retaliate by slapping steep tariffs on U.S. imports from states that are also home to top lawmakers and went for Trump in the election.
Commerce Secretary Wilbur Ross, in an interview with CNBC, said despite the global outcry over the proposed tariffs, the Trump administration was "not trying to blow up the world".
Mr Trump has railed against the U.S. trade deficit, arguing that other countries have been "taking advantage of" the United States for decades. "And we can't lose our aluminum industry", Trump said during a joint news conference with Swedish Prime Minister Stefan Lofven.
For those who fear a trade war, the candidates to replace Cohn as Trump's adviser do not bode well: Peter Navarro, the White House National Trade Council head who wrote a book called "Death by China: Confronting the Dragon - A Global Call to Action", and conservative commentator Larry Kudlow.
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More than a hundred Republican congressmen sent him a letter expressing their "deep concern" about the consequences of tariffs and recommending more targeted measures.
"That would be a case-by-case and country-by-country basis". If the goal is to keep out low-cost worldwide steel, with excess Chinese supply dragging down the entire global market, they say the US can't allow any supply in at low global prices.
"He is a globalist and he understands economics and trade, " said Bill George, a Goldman board member.
After days of drama and a last-minute diplomatic scramble, the White House is now hinting that the impending tariff announcement might have some form of national-security exception for the U.S.'s neighbours.
Trump claimed the United States last year had a trade deficit of "almost 800 Billion Dollars", significantly overstating the actual figure of $566 billion, which still was the biggest us trade deficit in nine years.
However, according to The Wall Street Journal, at the White House yesterday, aides began preparations for the ceremony ushering in a turn in trade policy that could recalibrate relations between the U.S. and its allies and trading partners.
China, which ranks 11 among the largest sources of USA steel imports, cautioned that it was prepared to "make an appropriate and necessary response" should the United States impose the tariffs.
Canada and the United States has created one of the world's most enduring and prosperous worldwide partnerships, he said, and it needs to be preserved.