The United States and Canada are reportedly on the verge of reaching a trade agreement covering steel, aluminium and energy sectors, with sources saying a signing could take place at the upcoming Asia‑Pacific Economic Cooperation (APEC) Summit later this month.
The deal, according to insiders briefed on the negotiations, would entail Canada accepting quotas on its steel exports in return for the U.S. lowering punitive tariffs on steel and aluminium products. Meanwhile, key issues such as Canadian automobile manufacturing and softwood lumber are not included in the current package.
Canadian Prime Minister Mark Carney, speaking briefly on the matter, urged caution: “We are in ongoing discussions with the Americans, and I wouldn’t over-play it. His trade minister, Dominic LeBlanc, echoed that progress has been made but stressed there is “still work to do,” warning against imposing a rushed deadline that might produce a sub-optimal outcome for Canadian workers and industry.
The backdrop to the talks is a sharp escalation in tariffs earlier this year. The U.S. imposed levies on Canadian steel, aluminium and auto imports, prompting Ottawa to respond with retaliatory measures.
Should the deal be finalised, it would mark a significant thaw in bilateral trade tensions between the two countries and offer relief to Canadian metals manufacturers and exporters hard-hit by the tariff war. It would also bolster U.S. access to Canadian energy, a strategic interest for Washington.
However, analysts caution that the narrow scope of this deal means many contentious sectors remain unresolved. Critical minerals, a vital export for Canada, are said to be excluded from the current negotiation. Other major issues such as auto manufacturing, lumber and more comprehensive supply-chain integration were not part of this round.
Any agreement signed at APEC will face legal and legislative hurdles in both countries. Canadian provinces dependent on metals exports will be watching closely, and U.S. lawmakers from manufacturing states will be evaluating whether the deal offers sufficient protections for their industries.
For now, both sides appear to be moving toward a “sector-by-sector” approach rather than a sweeping comprehensive deal—raising the question of whether the current agreement will serve as a temporary patch or the foundation for a broader trade realignment between Canada and the U.S.