Bloomberg reported on August 19 that Washington plans to cut Canadian steel and aluminum tariffs in half, from 50% to 25%, and auto tariffs from 25% to 15%. The negotiation is racing against the clock: a 50% tariff on roughly $20 billion in Canadian goods is scheduled to take effect at midnight on August 22.
The deadline is part of the tariff escalation the US government applied this year to its trading partners. According to Foreign Policy, on August 19, Washington suspended for 72 hours the imposition of 50% tariffs on roughly $20 billion in Canadian products, ranging from dairy to electronics, after signaling progress. For Mexico, the outcome functions as a benchmark: if Ottawa secures 25% on steel and aluminum and 15% on autos, it establishes a reference point for Mexico's USMCA table. According to El Financiero, the preliminary agreement surprised officials and companies in Mexico, where approximately 85% of exports enter the US market duty-free, but vehicles, steel, and aluminum remain subject to sector-specific tariffs.
The terms under consideration also include tariff reductions on lumber and a credit system for Canadian auto parts. On Thursday, August 20, Canada's chief negotiator Janice Charette and Minister Dominic LeBlanc met in Washington with US Trade Representative Jamieson Greer. Mark Carney stated that Canada entered the negotiation with the strongest commercial terms and is seeking to preserve that advantage. A White House official indicated the deal is still being finalized and that details disclosed should be considered speculation until the official announcement. LeBlanc said on August 21 that the parties are very close to an agreement.
The deadline expires at midnight on August 22, Washington time. If the agreement is confirmed, the treatment accorded to Canada sets a precedent that Mexico can reference at its own USMCA table, whose bilateral review remains open after three rounds held between May and July.
This article was drafted with artificial intelligence assistance based on verified sources and reviewed by a human editor before publication.