A trade standoff between the United States and Canada is complicating efforts to update the U.S.-Mexico-Canada Agreement (USMCA), according to agricultural lobbyist Randy Russell of The Russell Group.

The USMCA, which replaced the North American Free Trade Agreement in 2020, is scheduled for a joint review by the three member countries in 2026, making the current negotiating climate especially consequential for industries that depend on cross-border trade, including agriculture.

Russell says he is concerned about the direction of the talks, drawing a contrast between the two North American neighbors. "The relations between our government and the Mexican government are far better. With Canada, we have some real challenges," he says.

Any resolution, he adds, begins with leadership. "The relationship between President Trump and Mr. Carney, I'll leave that to the White House to describe, but we have some challenges there. There's an environment here where it seems to be escalating, not de-escalating," Russell says.

The tariff picture underscores that tension. The United States currently has a 50 percent tariff in effect on certain Canadian goods, including dairy. Canada has responded with its own tariffs on U.S. dairy and agricultural equipment, among other products, which are expected to take effect next week.

Given the climate, Russell says he has a hard time imagining a USMCA deal being reached anytime soon. "I suspect we'll be facing a year-by-year review at least for another year," he says. "Whether there's a deal before the end of the Trump administration, we'll just have to see."

The comments follow a breakdown in discussions with Canada in late August, after which U.S. agriculture leaders encouraged trade negotiators to keep talking, noting the need for a good trilateral deal.

Source: Brownfield Ag News