Australia will be exempt from US steel or aluminium tariffs once President Donald Trump signs an executive order, Malcolm Turnbull has confirmed.
After ongoing discussions between the two nations, both leaders confirmed the exemption via social media on Saturday morning.
"Great discussion today on security and trade. Australia/US trade is fair & reciprocal & each of our nations has no closer ally," the prime minister wrote on Twitter.
"Thank you for confirming new tariffs won't have to be imposed on Australian steel & aluminium - good for jobs in Australia and in US!"
Mr Turnbull later told reporters that legal paperwork confirming the exemption was yet to be completed, but an executive order would put Mr Trump's direction in place.
Australia would not have to provide anything in return for the exemption, he said.
Mr Turnbull said Mr Trump had acknowledged the trade relationship between Australia and the US was a fair and reciprocal one.
"It's a level playing field. In fact, the US has a large trade surplus with Australia," Mr Turnbull told reporters in South Australia.
Earlier Mr Trump took to Twitter to praise Australia's commitment to a fair and reciprocal trade and military relationship.
"Working very quickly on a security agreement so we don't have to impose steel or aluminum tariffs on our ally, the great nation of Australia!"
US trading partners were on Friday given a 15-day window to negotiate exemptions to the tariffs, due to come into effect in a fortnight.
Opposition trade and investment spokesman Jason Clare praised the government for securing the exemption, but was still wary of what tariffs on other US trade nations might mean for Australian jobs.
"The big threat to us now is that some of that steel from other countries that was destined for America might get redirected here at below cost price, threatening jobs in local Australian companies that make steel and aluminium," he said.
He called on the government to adopt Labor's plan, announced on Friday, to provide the Anti-Dumping Commission with 30 investigators, and for a tripling of penalties.
Australian Industry Group Chief Executive Innes Willox said the exemption was a positive step but he was concerned it would only apply to steel and aluminium from Australia and not to Australian companies producing overseas.
He said the threat of Australia sustaining collateral damage in a trade war also remained real.
"Australia will be among the biggest losers from a US inspired rise in global protectionism," he said.
"As an export nation our economy is best served by a rules-based free and fair trading environment."
Former prime minister Kevin Rudd also expressed worries about a global tit-for-tat on trade.
He disagreed with Mr Trump's belief that trade wars are good.
"History tells us they are bad, and they end up causing not just a contraction in global trade but, as a result of that, a contraction in global growth," he told ABC on Saturday.
