October 28, 2026
By Stephen Iwuh | Dalena Reporters
Canada and the United States have intensified high-level discussions aimed at resolving their bitter trade dispute, with sources saying negotiations are now moving quickly at the political level even as uncertainty remains over whether the two countries can reach an agreement before the November 3 U.S. midterm elections.
The renewed discussions come after nearly two months of stalemate following the collapse of formal Canada-U.S. trade negotiations in August. Canadian and U.S. officials are now exploring whether a narrower agreement, particularly covering tariffs on steel and automobiles, could be reached before American voters head to the polls next week.
Multiple sources with direct knowledge of the negotiations told Global News that discussions have accelerated at the political level, with Canadian Trade Minister Dominic LeBlanc leading Canada's side. However, Canada's lead negotiator, Janice Charette, indicated last week that formal negotiations between trade representatives had not yet resumed.
Prime Minister Mark Carney acknowledged Monday that there had been a slight intensification in discussions but made clear that Canada would not accept an agreement simply for the sake of reaching a deal.
“Canada is ready to sign an agreement that is in the interest of Canadians, all Canadians,” Carney said, adding that Ottawa has clear “bottom lines” and “red lines” that prevented it from accepting the proposal presented by Washington in August.
Carney also expressed uncertainty about whether U.S. President Donald Trump would ultimately honour any agreement reached between the two governments. When asked how he could be certain Trump would stand by a deal, Carney's response was blunt: he could not.
That uncertainty reflects the increasingly unpredictable nature of the Canada-U.S. trade relationship since Trump returned to the White House. Washington has imposed substantial tariffs on Canadian products, while Ottawa has responded with retaliatory measures designed to protect Canadian industries and workers.
Reuters reported that the latest discussions are focused particularly on U.S. tariffs imposed under Section 232 of American trade law. Those measures include tariffs of up to 50 per cent on Canadian steel and a 25 per cent tariff on automobiles, with officials discussing possible relief from those duties.
The negotiations are taking place against a politically sensitive backdrop in the United States. Trump's tariff policy has become an issue in several competitive Senate races, particularly in states such as Michigan and Maine, where Republican candidates are facing difficult contests.
That political pressure may be creating an opening for negotiations. Sources told Global News that Canadian officials view the period before the November 3 midterms as a potential window for reaching an agreement, although there is considerable doubt that a comprehensive deal can be completed within such a short period.
Trump has also suggested that an agreement with Canada could be reached soon. During a political rally in Michigan on Sunday, he predicted that the trade dispute would end “pretty soon,” while continuing to accuse Canada of taking advantage of the United States.
The mixed signals from Washington have made Canadian officials cautious. Trump has previously suggested that trade agreements were close only for negotiations to break down or for new tariffs to be announced.
The current talks follow the collapse of negotiations on August 21. Canada walked away after the United States made demands that Ottawa considered unacceptable, including proposed language that could have restricted Canada's ability to negotiate trade agreements with other countries. Canadian officials also objected to proposals involving French-language requirements and the country's automobile industry.
Following the breakdown, Washington imposed additional tariffs on billions of dollars worth of Canadian goods, prompting Ottawa to respond with retaliatory tariffs.
The tariff dispute has since expanded beyond steel and automobiles. The Trump administration recently removed some tariffs affecting Canadian products but simultaneously added new tariffs on a range of goods, including cocoa powder, paints and varnishes, shampoos, vinyl flooring, archery equipment and carpets. A 50 per cent tariff was also imposed on certain sewage and municipal waste products.
Some American lawmakers have nevertheless begun pushing for reductions in the trade barriers. U.S. Senator Susan Collins of Maine recently said Trump had agreed to remove tariffs on Canadian corrugated paper, plastic boxes and certain agricultural machinery used by businesses in her state. She argued that many Maine farmers and growers depend on Canadian products that are difficult or expensive to replace with American alternatives.
The issue is particularly important for industries operating across the Canada-U.S. border. The two economies remain deeply integrated, with manufacturers, farmers, retailers and other businesses relying on cross-border supply chains.
Canadian officials therefore face a difficult balancing act: securing tariff relief while avoiding concessions that could undermine Canada's broader economic interests.
The pressure is especially strong in Canada's steel and automotive sectors. Reuters reported that U.S. and Canadian officials are discussing potential relief from tariffs affecting these industries, with negotiations involving U.S. Commerce Secretary Howard Lutnick and Canadian Trade Minister Dominic LeBlanc.
The automotive industry is particularly exposed because vehicles and parts routinely cross the border multiple times during production. Higher tariffs can increase manufacturing costs, disrupt supply chains and make North American vehicles less competitive.
Trump has previously threatened to increase tariffs on Canadian steel and automobiles to 50 per cent beginning January 1, 2027, adding urgency to the current discussions.
However, Canadian officials are not assuming that an agreement is imminent. A Canadian government official told The Canadian Press on Tuesday that while discussions have continued, there has been only “limited progress.” The official was not authorized to speak publicly about the negotiations.
That assessment contrasts with the more optimistic signals coming from some U.S. officials. White House economic adviser Kevin Hassett has said the two countries are getting close to a deal, while Trump has repeatedly suggested that an agreement could be reached soon.
For Carney's government, the objective remains a trade arrangement that protects Canadian jobs and gives businesses greater certainty without compromising Ottawa's ability to pursue other international markets.
Carney has also been working to reduce Canada's economic dependence on the United States. His government has been pursuing stronger commercial relationships with other countries and has set a long-term goal of significantly increasing Canadian exports outside the U.S. market.
The urgency is heightened by Canada's slowing economy. Tariff uncertainty has affected investment decisions in sectors including automobiles, steel and aluminum, while businesses remain uncertain about what products could face additional duties in the months ahead.
The coming days could therefore prove critical for both governments. If Washington and Ottawa can overcome their remaining differences, a limited agreement on tariffs could provide immediate relief to businesses on both sides of the border.
But if the talks fail again, Canadian industries could face additional pressure when the United States implements threatened tariff increases in January.
For now, officials on both sides remain engaged, but there is no guarantee of a final agreement before the U.S. midterms. Canada's government is signaling that it wants a deal, but only one that respects Canadian interests, while Trump's administration continues to balance trade negotiations with domestic political pressure.
The result is a high-stakes race against time: Canada and the United States are talking again, but whether those discussions can produce a durable agreement remains uncertain.