The United States and Canada are negotiating an agreement to ease American steel and Canadian vehicle tariffs in an effort to improve trade relations between the two countries, which deteriorated following the failure of talks in August.
According to American and Canadian sources quoted by Reuters, a possible deal can be reached before the US Muslim elections, scheduled for 3 November, broadcast Telegraphy.
The negotiations focus on tariffs imposed under Article 232 of the American Trade Law, which allows for restrictions on imports for national security reasons. The measures include tariffs of up to 50% for Canadian steel and 25% for vehicles.
The parties are discussing the possibility of easing these obligations, although American sources say President Donald Trump’s administration requires further concessions from Otawa.
According to a Canadian source informed of negotiations, a steel agreement and vehicles can be reached before the elections. However, a source from the Canadian industry warned that if an agreement is reached, it may be limited and not a broad solution to all trade disputes.
The tariffs have also turned into a political issue for Trump, which is facing low levels of public support, while Republicans risk losing control of Congress in the upcoming elections.
Republican candidates in border states with Canada have demanded the end of the trade war, arguing that tariffs to Canadian imports are damaging local economies and businesses.
Negotiations on Article 232 tariffs are being conducted mainly under the direction of US Trade Secretary Howard Lutnick, as this issue is managed by the Department of Commerce and not directly by the Office of the US Trade Representative.
Lutnick and Canadian Minister responsible for trade with the US, Dominic LeBlanc, have been in regular contact over the past period, according to sources quoted by Reuters.
A LeBlanc spokesman said Canada continues constructive dialogue with the American side on a range of issues and is willing to work in trust for a more useful trade relationship for both sides, respecting Canadian interests.
Meanwhile, the US Trade Representative’s Office and Canadian authorities have also discussed the overall structure of a possible deal and other trade issues.
Canadian Prime Minister Mark Carney confirmed that talks with Washington have intensified somewhat, but stressed that Canada has not changed its stance. If any progress has been achieved, it has been because the United States is getting closer to our stance, he said, without providing further details.
Trade talks between the two countries failed in August, among other things because of disagreements over lowering tariffs for medium and heavy vehicles, important for Canadian factories.
American automotive producers had hoped the negotiations would bring relief from the initial 25% tariffs, which have raised the transport costs of vehicles and across the border.
Trump has warned earlier that on January 1st, 2027 steel tariffs and vehicles imported from Canada will increase to 50%. However, during a political rally Sunday, he predicted that the trade dispute would be resolved soon, without providing concrete details.
Another signal for easing tensions was the order signed by Trump on Friday, through which tariffs of 50% were removed for some Canadian agricultural and forest products. The move could bring benefits to businesses in the American state of Maine.
Despite more frequent contacts, there is still no confirmed agreement. According to Canadian sources, any agreement will depend on negotiations between the two governments and on the readiness of Trump and Carney to find a solution to meet the interests of both countries. /Telegraphy/
