Cross‑border trade review set to test supply chains, costs and confidence
Canada and the United States are set to launch formal talks in mid‑January to review their free trade agreement, opening a high‑stakes process for sectors from autos and steel to housing and mortgage credit.
The office of prime minister Mark Carney said Internal Trade minister Dominic LeBlanc, Canada’s point person for US–Canada trade, would meet US counterparts “in mid-January to launch formal discussions” on the United States–Mexico–Canada Agreement (USMCA), also known as CUSMA in Canada.
“The prime minister has said trade irritants flagged by the U.S. are elements of a ‘much bigger discussion’ about continental trade,” the PMO said in a statement. Carney said Ottawa saw “tremendous benefits” for Canada and the US in pooling resources where possible in key sectors.
Mortgage sector watches trade file closely
Carney met provincial leaders Thursday to brief them on the talks, which formed part of a broader review of USMCA scheduled for 2026 after US president Donald Trump negotiated the pact with a built‑in renegotiation clause.
Carney said Canada and the US have previously been “close to an agreement” on sector‑specific tariff relief covering steel, aluminum and energy, before Trump halted talks in October over an anti‑tariff advertisement aired in US markets by Ontario’s government. Tariffs are taking a toll on certain sectors of Canada's economy, particularly aluminum, steel, auto and lumber.
The prime minister said he expects those sectoral talks “to now roll into the broader CUSMA negotiation” while leaving the door open to restarting focused discussions. “If the United States wants to come back on that in those areas, we're always ready there,” he said.
Strategic materials and housing affordability in focus
Canada remains one of the most trade‑exposed economies in the world, with more than 75% of its exports going to the US, and Canada standing as the top export destination for 36 US states.
On lumber, Carney said Canada is “very ready” to strike an agreement on forest products with the United States, which faced “affordability challenges, including in the housing sector.”
“We can make an immediate difference to affordability in the United States to the benefit, yes, of Canadian workers, but also to American consumers,” he said.
Meanwhile, a recent Nanos Research poll showed 67% of Canadians believe a deal to lower tariffs is unlikely in the next six months. Just 28% believe a deal is likely, and 3% are unsure.
The outcome of the talks could shape long‑term costs for construction materials, energy and cross‑border capital flows, reinforcing how deeply continental trade architecture is tied to housing affordability on both sides of the border.
Micky Khaneka, broker with DLC Clear Trust Mortgages, observed that after months of back-and-forth headlines, most clients have grown accustomed to the noise and are no longer hesitating because of it.
“It is something that I’m assuming people watch, but it’s not something that has the topmost importance to people,” Khaneka told Canadian Mortgage Professional.
He added that buyers are increasingly focused on long-term goals rather than short-term headlines.
“I think a lot of people start to focus also on, ‘Okay, if this is a home that I’m planning to live in five to 10 years, does renting make sense for me or do I see myself buying? And if I’m going to buy, how much am I saving and how much am I paying?’ So I’m seeing that buyers are getting more and more knowledgeable and they’ve started to put up with the amount of news that’s coming at us better.”
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