Negotiators circle Section 232 relief with eight days left before the midterms
Negotiators from Canada and the United States are working on an agreement to ease US tariffs on Canadian steel and autos, with discussions centred on duties imposed under Section 232 of US trade law.
Reuters reported the talks, citing two US and four Canadian sources, and said the measures include a tariff of up to 50 percent on Canadian steel and 25 percent on autos.
One Canadian source briefed on the negotiations told Reuters a deal was possible before the November 3 midterm elections, while US sources said the Trump administration wanted Canada to make further concessions.
The Section 232 tariffs are administered by the Commerce Department, according to the same outlet, putting US Commerce Secretary Howard Lutnick rather than the US Trade Representative’s office at the centre of the negotiations.
Lutnick and Dominic LeBlanc, the minister responsible for Canada-US trade, have been in regular contact recently, one of the sources told Reuters.
Trump has previously announced he would raise tariffs on steel and auto imports from Canada to 50 percent from January 1, 2027, Reuters reported.
Prime Minister Mark Carney said in Ottawa on Monday there had been “a slight intensification” in talks, Reuters reported, adding that Ottawa had not changed its stance.
“To the extent any progress has been made, it’s because the US is coming closer to our position,” Carney told reporters.
CBC News reported Carney said his position has not shifted since talks collapsed in August. “We have very clear bottom lines, red lines, which meant that we were not willing to sign what was offered in August,” he said.
Bloomberg reported that talks broke down on August 21, leading Trump to impose 50 percent tariffs on about US$20bn worth of goods from Canada, with Canada retaliating with counter-tariffs on a similar value of US products.
That round collapsed in part over whether the US would extend tariff relief to medium- and heavy-duty trucks.
Carney acknowledged he cannot be sure Trump would honour a new agreement, AP News reported.
Asked whether the US president would “sign in pen,” he replied: “I don’t know that.”
A source familiar with the discussions told Radio-Canada there are “substantive conversations, but there are still key elements that remain unresolved.”
The source said the two sides are “not on the verge of an agreement just yet.”
Janice Charette, Canada’s chief trade negotiator, told the Toronto Global Forum on Thursday that “Pens are down, and the doors are open,” CBC News reported.
Charette said conversations are taking place at “multiple levels” but not at the negotiating table.
“We’re having conversations to see whether or not we can come back to the table for a set of detailed negotiations,” she said. “We don’t know exactly when that’s going to happen.”
A spokesperson for LeBlanc’s office said on Sunday that Canada “remains in constructive dialogue with our US counterparts on a range of priorities.”
Kevin Hassett, director of the National Economic Council, said on Fox News on Sunday that negotiations have “picked up” and are “gathering steam,” Bloomberg reported.
“I think it’s very close to finally having a deal on that,” Hassett said.
Reuters reported that Trump told a rally in Port Huron, Michigan, on Sunday the matter would be “settled pretty soon” and that the other side is “willing to give us anything at this moment.”
He told Detroit’s Fox 2 channel a deal could come in “probably a couple of months,” and possibly “before the actual election,” according to Bloomberg.
Trump signed an order on Friday removing 50 percent tariffs on some Canadian agricultural and forestry products, Reuters reported.
The Canadian Press reported he added tariffs to dozens of new products at the same time.
