Canada-US Trade Deal Collapses, Ford Calls for Critical Minerals Cutoff

By Finance News On Aug 25, 2026

The Canada-US relationship suffered another setback as trade negotiations broke down on August 21.

Earlier in the week, talks appeared to be going smoothly, with US President Donald Trump acknowledging progress and extending his own August 19 deadline for new 50 percent tariffs on C$28 billion in goods originating in Canada.

Talks began in earnest after the president announced tariffs on July 20 for a selection of previously CUSMA-compliant goods, including wine, hockey sticks and cement.

Both negotiating teams worked until the final moments, before Prime Minister Mark Carney recalled Canadian representatives after the US side inserted language into the deal that was unfavorable to Canada.

Carney suggested at the time that one of the most contentious provisions was the US’ ability to control which other countries Canada could negotiate new trade deals with.

“The US introduced in the last hours efforts to restrict our ability to have other trade deals … What we’ve accomplished in the last year, 20 new deals, economic and security partnerships, the prospect of doubling our market access because we believe in free trade,” the prime minister said during remarks made on August 22. “We’re the partner of choice for many countries around the world, and the Americans wanted to restrict that; unacceptable.”

The other key sticking points raised by the prime minister were a refusal by US negotiators to extend tariff relief on automobiles beyond light-duty vehicles. That would exclude Ford Motor’s (NASDAQ:F) F250 and F350 lineups, built in Oakville, Ontario, and the Chevrolet Silverado HD, built at General Motors’ (NYSE:GM) plant in Oshawa, Ontario.

Additionally, there was pushback against French language requirements and Québec cultural safeguards. The US administration has long viewed these laws as trade barriers.

Mining sector in limbo after talks break down

Apart from the key issues that ultimately fractured negotiations, Carney suggested that the deal was “a fair deal, a good deal for Canadians, not perfect, but a good deal became a deal we could not accept.”

Various elements related to Canada’s resource sector were under discussion, including the reduction of tariffs on steel and aluminum to 25 percent from 50 percent rate. Tariffs on autos would have fallen to 12.5 percent from 25 percent.

Also discussed as part of the negotiations was US access to Canadian critical minerals, and reports that US representatives were seeking right of first refusal to all critical minerals mined in Canada.

In an article published on August 18, S&P Global explores what right of first refusal would mean for Canada’s mining sector, noting that it would put miners and producers in a tough spot and questioning whether it would be legal.

Both countries have been placing increasing importance on critical minerals.

Earlier in the year, the US administration’s lead negotiator and Trade Czar Jamieson…