In 60 seconds: The United States and Canada are quietly negotiating relief from the tariffs on Canadian steel and autos, Reuters reported Monday, citing six sources on both sides — and one Canadian source said a deal could come before the November 3 midterm elections.
- Reuters: the US and Canada are working on a deal to ease Section 232 tariffs — up to 50% on Canadian steel, 25% on autos.
- Talks are private and unconfirmed by either government; the White House, Commerce and USTR did not respond to Reuters.
- Commerce Secretary Howard Lutnick is at the center, in regular contact with Canada's Dominic LeBlanc.
- One Canadian source sees a deal possible before the November 3 elections; US sources say Washington wants more concessions first.
- Tariffs have become a political liability in border states, with Michigan Republicans openly uneasy about the auto duties.
Here's the thing: after months of a bitter trade war, the first real sign of movement has arrived through anonymous sources, not a podium. Neither government is ready to own a deal publicly yet — but negotiators talking about actual relief, with a possible pre-election timeline, is a sharp change from August, when talks collapsed outright.
A steel mill in operation. Steel and autos are the two sectors at the center of the talks. Photo: Paora / Wikimedia Commons (CC0).
What happened
Reuters reported on October 26 that the United States and Canada are working on a deal to ease US tariffs on Canadian steel and autos, citing two American and four Canadian sources speaking anonymously because the talks are private. The negotiations focus on Section 232 tariffs: up to 50% on Canadian steel and 25% on autos. One Canadian source said a deal was possible before the November 3 elections; American sources said the Trump administration wanted further concessions first. The two accounts don't contradict each other — they describe the same negotiation from opposite ends of the table.
Latest verified facts
The Section 232 tariffs are administered by the Commerce Department, which puts Secretary Howard Lutnick — rather than the US Trade Representative's office — at the center of the talks, sources on both sides said. Lutnick and Dominic LeBlanc, Canada's minister for Canada-US trade, have been in regular contact recently.
LeBlanc's office confirmed the contact in general terms, saying Canada "remains in constructive dialogue" and stands "ready to work constructively and in good faith." The White House, the Commerce Department and the USTR's office did not immediately respond to requests for comment. So: talks confirmed in broad terms by Ottawa, details sourced anonymously, nothing announced. The timing lines up with President Donald Trump telling a Sunday rally in Port Huron, Michigan — a border town feeling the trade war firsthand — "We'll have that settled pretty soon."
| Tariff in play | Current rate | Status |
|---|---|---|
| Canadian steel (Section 232) | Up to 50% | Relief under discussion |
| Canadian autos (Section 232) | 25% | Relief under discussion |
| Canada's own support package (Oct 21) | C$9 billion | Announced by Ottawa + Ontario |
Why it matters
Reuters frames the politics bluntly: tariffs on Canadian imports have become a political liability for Trump, with his party's congressional control at stake next week. Republican candidates in border states have been calling for an end to the trade war — and not quietly. Representative Mike Rogers, running a tight Michigan Senate race against Democrat Abdul El-Sayed, said on "Meet the Press" that "the automobile portion of these Canadian tariffs worries me a little bit." When a Republican Senate candidate in Michigan says that days before an election, Washington listens.
Canada hasn't waited around, either. On October 21, Ottawa and Ontario unveiled a C$9 billion ($6.4 billion) support package for steel and autos: more than C$5 billion for a steel action fund, C$2.5 billion to help automakers boost electric-vehicle production, and C$1 billion for road links to Ontario's Ring of Fire mineral region. That's a government insulating its industries while it negotiates — and signaling it can hold out if talks stall.
Impact on the USA and the world
For American workers, the stakes are concrete. Steel tariffs raise input costs for US manufacturers that buy Canadian steel; auto tariffs hit a supply chain that crosses the border multiple times before a finished car rolls off a line in Michigan or Ohio. Relief would ease factory costs and could steady car prices — though showroom prices won't move overnight. For Canada, steel and autos are two of its most exposed export sectors, and a deal would lift a cloud hanging over mills and plants since August. For every other trading partner watching, a pre-election agreement would signal the administration will trade tariff leverage for political calm; a collapse would signal the opposite.
What happens next
Our take: watch the next ten days, not the next ten headlines. If a deal is genuinely close, you'll see it in stages — a Lutnick-LeBlanc meeting made public, a joint statement, or a quiet tariff notice in the Federal Register. If you hear only more rally promises, treat "possible before November 3" as one source's optimism, not a done deal. What Ottawa is willing to concede — and what Washington demands — will decide whether this closes or drags past the election. We'll update this post the moment either government confirms anything on the record.
Sources: Reuters, "US, Canada working on deal to ease steel, auto tariffs, sources say" (October 26, 2026); Reuters, "Trump says Canada tariff deal coming 'soon' at Michigan border rally" (October 25, 2026); Reuters, "Canada, Ontario unveil multi-billion steel and auto support package" (October 21, 2026).
Read our earlier coverage: 4 Small Businesses and 25 States Are in Court Today to Kill Trump's Tariffs. Related: Canada Express Entry in 2026: How the Points Race Actually Works.