Commodities February 26, 2026

Canada Seeks Bilateral Deals With U.S. to Lift Sector Tariffs as USMCA Review Looms

Ottawa aims to negotiate removal of tariffs on steel, aluminium and autos while trilateral trade pact review proceeds

By Derek Hwang
Canada Seeks Bilateral Deals With U.S. to Lift Sector Tariffs as USMCA Review Looms

Canada is pressing the United States to scale back or eliminate tariffs affecting steel, aluminium and automobiles, and Ottawa says such concessions could be implemented through bilateral sector-specific agreements negotiated alongside a review of the United States-Mexico-Canada Agreement (USMCA). Dominic LeBlanc, the minister responsible for Canada-U.S. trade, said private intergovernmental talks on the trilateral pact remain constructive even as some U.S. officials publicly question the USMCA's future.

Key Points

  • Canada is seeking the removal or rollback of U.S. tariffs on steel, aluminium and automobiles through bilateral sectoral agreements negotiated alongside the USMCA review - impacts manufacturing and metals sectors.
  • Dominic LeBlanc said private government-to-government discussions among Canada, the United States and Mexico are not discouraging despite public doubts voiced by some U.S. officials - impacts diplomatic and trade policy arenas.
  • Mexico has already begun formal negotiations with the United States on renewing the USMCA; the trilateral agreement must be reviewed and completed by July 1 - impacts cross-border trade and supply chains.

Overview

Canada has opened talks with the United States aimed at removing tariffs that have hit several critical industrial sectors, and Ottawa says any outcome on those sectoral levies could be formalised via bilateral arrangements alongside a broader review of the USMCA trade pact.

What Ottawa says

Dominic LeBlanc, who holds responsibility for trade matters between Canada and the United States, told a business audience in Toronto that Ottawa remains prepared to pursue removal of sector-specific tariffs. He characterised those tariff fixes as measures to be negotiated bilaterally and placed adjacent to the trilateral USMCA framework.

"We are still ready and anxious to do that work," LeBlanc said, underlining Ottawa's interest in resolving what it calls painful levies on key sectors.

LeBlanc specified that the tariff discussions target sectors including steel, aluminium and automobiles - industries that were subject to duties introduced by President Donald Trump's administration the previous year.

Trilateral framework and private diplomacy

While publicly there has been scepticism from some U.S. officials about the relevance of the USMCA, LeBlanc said private, government-to-government conversations among Canada, the United States and Mexico have so far been encouraging. He noted that this private diplomatic track contrasts with the public political debate in the United States.

"There is a public prosecution of the argument, the political argument in the United States. And there are the private government-to-government-to-government conversations which are not discouraging," LeBlanc said.

LeBlanc plans to meet with U.S. Trade Representative Jamieson Greer next week as part of continued engagement on these issues.

Timing and trilateral renewal

Mexico has already initiated formal talks with the United States on renewing the USMCA. LeBlanc said he is not pessimistic about completing a renewal of the trilateral framework, citing the shared economic interest of the three parties in maintaining the agreement.

The USMCA is due for review and requires completion by July 1, a timeline LeBlanc referenced in his comments on the review process.


Context limitations

The minister's remarks focused on the negotiating approach and timing. He pointed to the possibility of sector-by-sector bilateral arrangements running adjacent to a trilateral USMCA renewal, but did not offer specifics on the content, sequencing or legal mechanics of any eventual agreements.

Risks

  • Public political opposition in the United States could complicate or delay tariff rollbacks, creating uncertainty for steel, aluminium and automotive industries.
  • A failure to complete the USMCA review by the July 1 deadline or to reconcile bilateral sectoral arrangements with the trilateral framework could prolong trade policy uncertainty for manufacturers and exporters.

More from Commodities

EU Pushes Back After U.S. Replaces Turnberry Tariff with New 'Import Surcharge' Feb 26, 2026 Why Ivory Coast and Ghana Are Struggling to Sell Cocoa and Pay Farmers Feb 26, 2026 Administration Plans to Shift Minimum Half of Waived Biofuel Obligations to Large Refiners, Sources Say Feb 26, 2026 Deutsche Bank: U.S. Supreme Court Ruling Likely to Lift Gold Prices Only Slightly Feb 26, 2026 Nvidia’s Beat Falls Short of a Big Market Reaction Feb 26, 2026