Canada prioritizes tariff relief over USMCA renewal as July 1 review nears

Canada is focusing first on relief from U.S. tariffs on steel, aluminum and automobiles, even as the July 1 review of the U.S.-Mexico-Canada Agreement approaches, Canada’s ambassador to Washington said.

Mark Wiseman said the tariff fight is the more immediate economic issue for Ottawa because the levies are already weighing on Canadian exporters and investment decisions. He said the formal USMCA review matters, but it is not the first priority while the sector tariffs remain in place.

Wiseman also said the agreement’s terms stay in force until 2036 unless the three countries decide to change them. That means the July 1 review does not automatically end the pact, but it can shape whether the parties move toward renewal or a longer review cycle.

Tariff relief first

The ambassador’s comments underline a strategy in Ottawa that puts immediate tariff relief ahead of broader treaty negotiations. Canada has been trying to ease pressure on industries hit by U.S. duties while keeping the wider trade relationship intact.

The tariffs at issue cover steel, aluminum and autos, three sectors that matter heavily to Canadian industry and cross-border supply chains. The Wall Street Journal reported that some of those tariffs are as high as 50%.

Canadian officials have linked progress on USMCA-related issues to tariff relief, suggesting they want the two discussions treated together rather than as separate tracks. In their view, the economic damage from the duties is the more urgent problem.

A June timeline of pressure

The trade dispute has been building for weeks ahead of the review date.

On April 22, the Associated Press reported Prime Minister Mark Carney saying the United States does not get to dictate the terms of USMCA talks and that refining the agreement would take time. That set out Canada’s basic position before the formal review window opened.

On June 9, U.S. Trade Representative Jamieson Greer said Canada’s retaliatory tariffs were slowing progress in the negotiations. He also said U.S. officials were conducting formal talks with Mexico ahead of the July 1 review.

Wiseman’s comments on June 15 added the Canadian side of the latest exchange, with Ottawa making clear that tariff relief is the more urgent goal.

What Canada and the U.S. disagree on

The two sides are not aligned on what is blocking progress. Canada says relief from U.S. tariffs has to come first, while the U.S. side says Canada’s retaliatory tariffs are the obstacle.

That disagreement leaves the July 1 review surrounded by uncertainty. Business leaders have been watching the deadline closely because it could influence future North American trade rules, even if the existing agreement remains in force after the review begins.

For Canadian exporters, the near-term risk is not just the review itself but the ongoing tariff pressure on steel, aluminum and auto supply chains. Those measures can affect pricing, production and hiring decisions before any formal treaty change is made.

What comes next

The immediate question is whether the two governments can reach any understanding on tariffs before the July 1 review process starts.

Canadian officials will also be watching for signs that the review turns into a quick renewal decision or a longer period of negotiation. Either outcome could shape business expectations for years.

For now, Ottawa is signaling that the first order of business is tariff relief. The broader USMCA discussion remains important, but the sector tariffs are the issue Canadian officials say is biting the economy right now.

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