Ongoing bilateral trade tensions, marked by U.S. Section 232 and Section 338 tariffs on Canadian steel, aluminum, autos, and other goods plus Canadian retaliatory duties on U.S. imports, continue to shape expectations for any agreement lowering rates. August 2026 negotiations collapsed over last-minute terms, triggering 50 percent duties and prompting Canada to match them dollar-for-dollar on steel, aluminum, dairy, and agricultural products. As of late October 2026, Canadian officials including Prime Minister Mark Carney and chief negotiator Janice Charette have stated that tariff-free trade will not return, with focus instead on minimizing rates across the broadest range of goods while stabilizing the relationship ahead of the USMCA review. U.S. midterm elections on November 3 represent a near-term political window, though sources indicate limited prospects for a deal beforehand, with further U.S. tariff escalations threatened for January 2027 on autos and steel.