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If media reports are accurate about the pending U.S.-Canada deal on trade, it won’t be better than the Canada-U.S-Mexico Agreement (CUSMA) Prime Minister Mark Carney said Canada would get in October 2025.
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It also won’t be the comprehensive, sector-wide deal Canada wanted.
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If it is finalized, Trump said he will cancel the 50% tariffs he threatened to impose on Aug. 19 on $28 billion worth of Canadian goods under Section 338 of the U.S. Tariff Act.
He will reportedly reduce the 50% sectoral tariffs on Canadian aluminum and steel, and 25% tariff on autos, Trump imposed in June 2025 under section 232 of the U.S. Trade Expansion Act, that Carney called “unlawful, unjustified and illogical” at the time.
The deal will reportedly lower the 50% sectoral tariffs on aluminum and steel to 25% and reduce tariffs on autos from 25% to 15% and possibly 7.5%.
The future of U.S. tariffs on softwood lumber and wood products is unclear.
In return, Carney will increase access to Canada’s dairy market for U.S. producers without dismantling supply management and (according to Trump) remove tariffs on some agricultural products.
Carney will also remove counter-tariffs on U.S.-made automobiles and has asked the eight provinces that imposed them to lift bans on selling U.S. alcohol and drop provincial “buy Canadian” polices that exclude the U.S.
There may be other parts of the deal we don’t know about and Trump, of course, could change his mind at any time.
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