With the U.S. midterm elections approaching on November 3, Canada’s trade relationship with its largest export market is caught between renewed optimism and an unfinished negotiation. Conservative Leader Pierre Poilievre is pressing Prime Minister Mark Carney to deliver an agreement with President Donald Trump, arguing that Canadians cannot afford another prolonged wait.
Carney says negotiators will work toward a mutually beneficial deal in the coming weeks, while Trump says the two sides have the “concept” of an agreement. Neither has announced final terms. Behind the political exchanges is a harder question for Canadian workers and businesses: how quickly can Ottawa secure meaningful tariff relief without accepting conditions it considers damaging to the country’s industries or independence?
Poilievre Shifts the Focus From Promises to Results
At a news conference on Sunday, November 1, Poilievre urged Carney to “get a great deal” with Washington and argued that ordinary Canadians cannot afford to wait. He accused the prime minister of failing to fulfil an election promise to secure a better trade arrangement than the one Canada previously enjoyed. His message was blunt: “It’s time for Mr. Carney to put the big talk in the past and deliver real results.” The timing mattered. Carney had just publicized a conversation with Trump that sounded encouraging, but the public still had no agreement to examine. Poilievre used that gap between diplomatic optimism and a signed outcome to challenge the government’s record.
The criticism brings an abstract trade negotiation down to the practical decisions made by employers and households. A parts supplier weighing a new contract needs to know what duties its American customer could face. A manufacturer considering equipment or additional shifts must judge whether today’s costs will remain in place next year. Those examples help explain why uncertainty can be damaging even when no new tariff is announced on a particular day. Yet Poilievre’s demand contains an important qualification: he asked for a great deal, not simply the fastest deal available. That distinction leaves room for the very trade-off Carney has been emphasizing. Speed would provide relief from uncertainty, but the terms ultimately determine whether an agreement is worth signing.
Carney and Trump Have an Outline, Not a Finished Agreement
Carney said on November 1 that his latest conversation with Trump built on constructive discussions about the outline of a mutually beneficial trade agreement. The Prime Minister’s Office said the call took place on Saturday. According to Carney, the objective is to create jobs, ease pressure on family budgets and fully respect Canada’s languages, culture and sovereignty. He said negotiating teams would work over the coming weeks to deliver that outcome. Later Sunday, speaking to reporters in Iowa, Trump declared that the countries had the “concept of a very good deal.” He suggested the arrangement could benefit American farmers and said the two sides were getting close. The public statements indicate improved communication, but not completed negotiations.
Trump also raised the possibility of reviving the Keystone XL oil pipeline, saying it would be part of the agreement and suggesting Canada would pay for it. Those claims should not be mistaken for a confirmed Canadian commitment. The original project was abandoned after a U.S. permit was revoked in 2021, and Reuters reported that a different pipeline proposal using some existing Keystone infrastructure remains under consideration, with an investment decision expected in 2027. Bringing energy infrastructure into an already complicated tariff negotiation illustrates how far apart a broad political understanding and an executable deal can be. There has been no jointly published text spelling out tariff reductions, pipeline obligations, implementation dates or enforcement measures.
August’s Failed Negotiations Explain Ottawa’s Caution
Carney’s reluctance to promise a quick settlement is rooted in the breakdown of talks in August. On August 21, he suspended negotiations and ordered Canadian officials home, saying late changes to the U.S. offer were unfair and economically unacceptable. In a speech the next day, he said Ottawa had been willing to discuss removing remaining retaliatory tariffs on strategic sectors in exchange for substantial American relief. But he drew lines around Canadian sovereignty, the protection of French and Canadian culture, and the viability of major industries. The government’s argument was that tariff relief would have little lasting value if it came with restrictions that weakened the country’s ability to make its own economic decisions.
The breakdown brought immediate consequences. Ottawa says Washington’s new 50 per cent duties covered $27.6 billion in Canadian goods, with additional Canadian counter-tariffs on the same value of U.S. products taking effect September 8. These measures targeted a broad mix of merchandise rather than every shipment crossing the border. There were also areas of subsequent movement: Trade Minister Dominic LeBlanc said in late August that the United States had withdrawn certain objections concerning French-language and cultural protections. That history complicates today’s choice. It shows why Carney argues that negotiating details matter, but also why Poilievre can point to real costs of leaving the dispute unresolved. A verbal thaw will not by itself reverse customs charges already affecting trade.
The Economic Costs Are Becoming Harder to Ignore
The Bank of Canada’s October outlook puts a number on the deterioration. It estimates that the average U.S. tariff rate on Canadian goods rose to 7.5 per cent from 5.0 per cent in July. Crucially, it also estimates that roughly 80 per cent of Canadian goods exports to the United States remain tariff-free. The problem is therefore not a universal shutdown of cross-border commerce, but concentrated pressure on industries facing much higher rates. Canada’s trade exposure remains substantial: Global Affairs Canada reported that the United States received 72.5 per cent of Canadian merchandise exports in 2025. When access to a market of that size becomes less predictable, even firms that are not directly hit may reconsider investments and supply arrangements.
A separate October analysis from the Parliamentary Budget Officer puts the longer-term stakes in sharper focus. It estimates that Canada-U.S. trade measures introduced since early 2025 could leave Canadian real GDP 1.4 per cent below a pre-tariff baseline after five years. Under the report’s scenario in which tariffs persist, employment could be lower by as many as 185,000 jobs at the peak of the impact. These are modelled effects, not a tally of jobs already lost, and depend on the assumptions used. Recent trade data also show why simple narratives can mislead: Statistics Canada recorded an 8.1 per cent monthly rebound in exports to the United States in August and noted that impending tariff changes may have encouraged some shipments to move early.
Steel and Auto Workers Have the Most Immediate Concerns
For Canadian steelmakers and automakers, the pressure is especially tangible. Ontario’s October economic update reported that provincial steel exports to the United States totalled $4.1 billion in the first eight months of 2026, compared with $8.4 billion in the corresponding period of 2024. In September, Stelco announced plans to lay off up to 500 workers at its Hamilton and Lake Erie operations, citing the trade crisis alongside weak demand and import pressure. The impact does not stop at the mill gate. A steel producer facing fewer orders may purchase less transportation, maintenance and equipment, while communities dependent on industrial payrolls feel the effects in local stores and services.
That explains why recent negotiations have focused heavily on specific sectors. Reuters reported on October 26 that U.S. and Canadian officials were discussing relief from American tariffs of up to 50 per cent on Canadian steel and 25 per cent on autos. Trump has also threatened a 50 per cent tariff rate on Canadian steel and auto imports beginning January 1, 2027. Those figures concern different trade measures from the newer 50 per cent duties imposed on other Canadian products in August. A narrow arrangement covering autos and steel might still deliver substantial relief to factories, but it would not necessarily settle every dispute between the countries. Businesses will need to see which products qualify and how long any relief lasts.
U.S. Midterms Could Change the Politics, but Not the Tariffs Overnight
The November 3 midterms add urgency because the trade war has become an election issue in some U.S. border states. In Michigan, Republican Senate candidate Mike Rogers released an advertisement calling for an end to the tariff fight with Canada, despite having previously defended aspects of Trump’s trade policy. The message reflects a political reality in a state where production lines, suppliers and customers are linked to Canadian industry. Maine is another state where trade tensions have entered the debate surrounding a competitive Senate race. For American politicians facing voters concerned about prices and jobs, a softer approach toward Canada may offer an opportunity to demonstrate practical economic results.
An election result, however, would not automatically erase the tariffs. Reuters reported on November 1 that Democratic control of one or both congressional chambers could produce tougher oversight of Trump’s trade decisions and votes aimed at repealing duties. But any repeal legislation would still face the president’s veto, and opponents are not expected to hold the two-thirds majorities needed to override it. A changed Congress could increase pressure on the White House without forcing a settlement. That uncertainty runs both ways for Ottawa: election-season incentives might make Washington more willing to bargain now, while a new political balance afterward could alter the tone without providing quick relief. There is no guaranteed negotiating deadline tied to Tuesday’s vote.
Carney’s Next Test Goes Beyond a Single Trade Announcement
Carney is also trying to reduce the degree to which Canada’s economic future depends on any one American administration. On October 30, Canada and the European Union launched an Alliance for the Future, with plans to deepen cooperation in trade, energy, critical minerals and advanced technology. The two sides agreed to define a closer association by their 2027 summit, but that is a longer-term project, not an immediate replacement for American customers. Canada already has extensive commercial ties with Europe; building the capacity, logistics and relationships needed to sell substantially more goods there takes time. For companies dealing with today’s tariffs, diversification may provide a strategy for future resilience without solving the next payroll or shipment deadline.
Ottawa now faces two near-term tests. The first is whether the renewed U.S. discussions produce written, enforceable relief for exporters rather than another optimistic exchange between leaders. The second comes on November 5, when Finance Minister François-Philippe Champagne is scheduled to table the federal budget, outlining how Canada intends to support investment, employment and economic resilience. Those decisions will reveal how the government plans to manage the trade disruption while negotiations continue. Poilievre’s demand for results and Carney’s insistence on acceptable terms are not mutually exclusive goals. The unresolved question is whether they can be achieved together, before the cost of waiting becomes still harder for Canadian businesses and families to absorb.
