Carney: Sectoral deals are unlikely, talks likely to roll into USMCA review

Canada spent weeks trying to get a deal for steel and aluminum producers in the autumn. At one point a deal looked very close and Trump even hinted that it was coming.However the deal fell apart and Trump blew up over Ontario's tariff ads. The leaders met at the FIFA World Cup draw and the commentary was positive but it looks like no help is coming for steel and aluminum for now. That said, the help could come in 2026 as a broader trade deal is negotiated. U.S. Trade Representative Jamieson Greer told members of U.S. Congress Wednesday that there were some things the US wanted from Canada before extending the USMCA for 16 years. Some points in a leaked document:Access to the dairy marketCanada’s Online Streaming Act and Online News ActProvincial bans on U.S. alcohol productsAlberta’s unfair treatment of electrical power distribution providers in MontanaGovernment procurementThat seems like a reasonable starting point for negotiations. A key timeline to watch is early, which is when the US will outline its USMCA plans to Congress in more detail.Perhaps the larger difficulty in negotiations will be the US trying to align North American policy, while also asking so much of its neighbours while continuing to restrict access to its markets. From the same document, here are some US priorities:Strengthening rules of origin for non-automotive industrial goods to ensure trade benefits flow to the Parties.Enhancing alignment on tariffs, export controls, and investment screening.Developing mechanisms to penalize the offshoring of U.S. production to Canada or Mexico resulting from regulatory arbitrage.Developing a "Critical Minerals Marketplace" to incentivize regional mining, processing, and manufacturingDespite all the drama, the Canadian dollar has outperformed the US dollar this year and is near a three-month low.