OMM Newsroom
The United States and Canada are working on an agreement to ease tariffs on steel and automobiles, two U.S. and four Canadian sources said, according to AnewZ. The neighboring countries are trying to repair relations after trade talks collapsed in August.
The discussions concern duties imposed under Section 232 of U.S. trade law. Under the measure, tariffs of up to 50% apply to Canadian steel and 25% to automobiles. The talks are considering possible concessions in both sectors.
Commerce Department plays key role in talks
The negotiations come at a politically sensitive time. President Donald Trump’s approval ratings are at record lows, and his Republican Party could lose control of Congress in the Nov. 3 midterm elections. Tariffs on Canadian goods have become a political liability, with Republican candidates in border states calling for an end to the trade war.
A Canadian source familiar with the negotiations said a deal on steel and automobiles could be reached by election day. U.S. sources said the administration expects further concessions from Canada. All sources requested anonymity because the talks are confidential.
Because the U.S. Commerce Department administers Section 232 tariffs, U.S. Commerce Secretary Howard Lutnick is at the center of the negotiations; the Office of the U.S. Trade Representative is not the main party. Sources on both sides said Lutnick has recently been in frequent contact with Dominic LeBlanc, Canada’s minister responsible for trade with the United States.
A spokesperson for LeBlanc said Canada continues to engage in constructive dialogue with its U.S. counterparts on a range of priorities. Canada is prepared to work in good faith to build a trade relationship that benefits both sides while protecting the country’s interests, the spokesperson said.
An official from the Office of the U.S. Trade Representative said the office and Canada had discussed in recent days the general framework of a possible agreement and other outstanding trade issues. The White House and the Commerce Department did not immediately comment.
Ottawa says talks are making progress
Prime Minister Mark Carney said negotiations with Washington had intensified somewhat in recent days, but Canada’s position had not changed. He told reporters that any progress was due to “the U.S. moving closer to our position,” but gave no details.
A source from Canada’s industrial sector said that if an agreement is reached, it would probably come quickly but have limited scope. The source also cautioned that a deal might not happen at all.
Another Canadian source said they had long expected an agreement on Section 232 tariffs before the midterm elections. The outcome would ultimately depend on Trump and Carney, the source said, adding that both leaders had said a mutually beneficial result was possible. Carney has repeatedly stressed that he will accept only a good deal for Canada.
The previous round of talks between the United States and Canada stalled in August, partly over disagreements about reducing tariffs on medium- and heavy-duty vehicles, which are important to Canadian factories. U.S. automakers had hoped the talks would lead to easing the initial 25% tariffs. The duties have increased the cost of shipping vehicles and parts across the border.
Trump has said he will raise tariffs on imports of Canadian steel and automobiles to 50% from Jan. 1, 2027. Speaking at a rally on Sunday, he predicted the dispute would be resolved soon but gave no details.
On Friday, Trump signed an order lifting 50% tariffs on some Canadian agricultural and forestry products. The move could benefit businesses in Maine.
