Canada Signals Delay in US Tariff Deal as Talks Shift to USMCA Review

Canadian Prime Minister Mark Carney has indicated that Canada is unlikely to secure a near-term agreement with the United States to ease tariffs on key sectors such as steel and aluminum. Instead, negotiations are now expected to be folded into the broader review of the US-Mexico-Canada Agreement (USMCA), known in Canada as CUSMA, scheduled for next year.

Speaking in Ottawa on Thursday, Carney said that while Canada and the United States had previously made progress toward a sector-specific metals tariff agreement, discussions were abruptly halted by US President Donald Trump in October. According to Carney, the pause came after the province of Ontario aired television advertisements in the United States featuring former President Ronald Reagan criticizing tariffs, a move that reportedly irritated the White House.

Carney explained that given the evolving timelines and political context, it has become increasingly unlikely that a standalone agreement on metals tariffs will be reached in the short term. “My judgment is that that is now going to roll into the broader CUSMA negotiation,” he said, adding that the convergence of deadlines makes a sectoral deal improbable for now.

Despite the setback, the Prime Minister emphasized that Canada still views the previously discussed terms as valid and available. However, he noted that the US has not re-engaged in negotiations since talks were suspended. This lack of momentum has reinforced Canada’s expectation that tariff issues will be addressed during the comprehensive USMCA review rather than through a separate agreement.

Carney also revealed new details about recent high-level discussions involving North American leaders. He said that he, President Trump, and Mexican President Claudia Sheinbaum agreed on broad parameters for the upcoming USMCA review during a meeting held on December 5 in Washington. The meeting took place on the sidelines of the FIFA World Cup draw event, underscoring how trade diplomacy continues alongside major international gatherings.

As uncertainty around tariffs persists, businesses in Canada’s steel and aluminum industries remain focused on the USMCA review as the most likely path toward relief. The outcome of those negotiations could have significant implications for North American trade, supply chains, and cross-border economic stability in the years ahead.