The United States and Canada are working toward an agreement to ease US tariffs on Canadian steel and automobiles, Reuters reported, citing sources familiar with the negotiations, as both governments seek to improve trade relations following the collapse of talks in August.
Negotiations focus on Section 232 duties
Discussions center on Section 232 tariffs, including duties of up to 50 percent on Canadian steel and 25 percent on automobiles. US Commerce Secretary Howard Lutnick and Canada's minister responsible for Canada-US trade, Dominic LeBlanc, have maintained regular contact, while the US Trade Representative's office is participating in discussions on the broader framework of a potential agreement.
Agreement possible before US midterm elections
A Canadian source said a deal could be reached before the November 3 US midterm elections, although US sources indicated that Washington was seeking additional concessions. A Canadian industry source suggested that an agreement could emerge quickly but would likely have a limited scope.
Canadian Prime Minister Mark Carney confirmed that negotiations had gained some momentum, attributing progress to Washington moving closer to Ottawa's position while emphasizing that Canada's stance remained unchanged.
Vehicle tariffs remain a key sticking point
Previous negotiations broke down partly over duties on medium- and heavy-duty vehicles, while US automakers have sought relief from tariffs that have increased cross-border shipping costs for vehicles and components.
Meanwhile, pressure for an agreement has increased among Republican candidates in US border states, who have called for an end to the trade dispute with Canada ahead of the elections.
