Canada and US Race Final Hours to Finish Trade Deal Before Saturday Deadline

Canadian and American negotiators were racing through the final hours before a Saturday midnight deadline, with specific terms of a proposed trade agreement beginning to circulate publicly even as the deal itself remained unsigned, according to reporting from CBC News, the Globe and Mail and CNN.

Two industry sources told CBC News that the proposed agreement would eliminate the 10 percent Section 232 tariff on Canadian softwood lumber by September 1, though existing countervailing and anti dumping duties on lumber would remain in place and be addressed separately in the fall. The Globe and Mail reported, citing sources familiar with the talks, that the deal under discussion would also lower steel tariffs to 25 percent within a new rate quota system, with shipments above the quota facing a 50 percent tariff, and would set a flat 15 percent tariff on automobiles, down from 25 percent, with no special carve out for the US made components in Canadian built vehicles. A separate CBC source said that because North American auto manufacturing is so integrated, with Canadian built vehicles often containing fifty percent or more American made parts, applying the tariff only to non US content could in practice cut the effective rate further, though this detail has not been confirmed by either government.

Not everyone inside the US administration appears satisfied. CBC News reported that Commerce Secretary Howard Lutnick has expressed dissatisfaction with the deal on the table, specifically objecting to lowering sectoral tariffs on automobiles, according to sources familiar with internal discussions. President Trump nonetheless told reporters Friday that the deal with Canada is moving along and that we should be able to have a deal with Canada, per CNN’s reporting, though he offered no further detail on outstanding disagreements within his own administration.

Provincial premiers remain divided over Prime Minister Carney’s request that provinces return American alcohol to store shelves as part of the emerging deal. Quebec Premier Christine Frechette said on social media Thursday that she had spoken directly with Carney and was still deciding whether to agree, writing that she would analyze with all necessary seriousness the information that has been given her and the impact on Quebec before making a decision, according to the Globe and Mail’s report of her statement. Manitoba Premier Wab Kinew said he was skeptical of reaching a durable deal with the Trump administration, telling radio station 680 CJOB that even the best deal in the world today could be undone if things go off the rails in Iran for Trump next month and he tries to whack us on the head again, as reported by Global News. Saskatchewan Premier Scott Moe, by contrast, has publicly praised the direction of the talks, saying Carney is poised to broker what Moe called a best in class trade agreement.

The negotiations have also become a domestic political flashpoint. Conservative Leader Pierre Poilievre said at a news conference in Kitchener that Carney had promised to be elbows up during the election campaign and should not take a bad deal, adding that Conservatives are concerned about rumours that Carney might be willing to cave and accept one sided tariffs, according to the Globe and Mail. Separately, US Vice President JD Vance was recorded telling a private fundraiser in Southampton, New York that Carney comes in and puffs his chest out and says he’s going to out tough Donald Trump, calling it hilarious because Carney presents this as some victory for Canada when fundamentally they climb down on a lot of issues, in a recording obtained by The Canadian Press and reported by the Globe and Mail. Vance also described Carney personally as a very sweet guy in the same remarks.

The current round of talks follows Trump’s decision Tuesday to pause the threatened fifty percent tariffs for three days after announcing what he called a deal subject to the finalization of documents, a characterization Prime Minister Carney’s own statement at the time described more cautiously as substantial progress with important work still to be done. LeBlanc told reporters Thursday afternoon that negotiators were very close and continuing to make progress, adding that Canadians expect us to get a deal that’s in the economic interest of Canada and Canadian workers, according to CNBC.

If no agreement is reached by 12:01 a.m. Eastern time Saturday, fifty percent tariffs on roughly twenty billion dollars worth of Canadian exports are set to take effect. As of Friday evening, negotiators from both countries remained in Washington, with no final text yet made public.