Midnight deadline looms as Canada seeks deal to avoid Trump's steep new tariffs

Midnight deadline looms as Canada seeks deal to avoid Trump's steep new tariffs

New tariff deadline looms as Canada, U.S. officials finalize trade deal

Happy Friday! Here's a recap of the latest news from the trade negotiations between Canada and the U.S.

Officials from both countries have been racing to finalize an agreement before U.S. President Donald Trump's latest tariffs take effect. (Earlier this week, he delayed them by three days.) Yesterday, talks went late into the evening.)

The agreement will likely see the U.S. slash tariffs on Canadian goods, including steel, in exchange for concessions. A big one: U.S. alcohol sales. Prime Minister Mark Carney has asked the provinces to return American alcohol to store shelves. Some premiers weighed in on the request, although we still have yet to hear from Ontario Premier Doug Ford. It's also unclear whether Canadians will want to buy U.S. booze if it's available again.

Details are scant, but a source with knowledge of the deal told CBC News yesterday that a lower tariff on Canadian steel will include a quota system, which will only lower the tariff rate on a set volume of imports. Dairy is also on the table; the deal reportedly includes a change to dairy licence allocation, which could increase U.S. dairy supply in Canadian stores.

We will be tracking the developments today, so follow along for the latest.

Earlier this week, I went to visit Lind Furniture, which has been making upholstered furniture in Woodbridge, Ont., for nearly 60 years. Over the decades, its clients included Sears, Eaton’s and Simpsons — some of the biggest Canadian department stores in their day.

Nowadays, Lind white-labels for Costco (meaning they make sofas that can be ordered through Costco), but, despite the major partnership, as much as 40 per cent of Lind's business is in cross-border trade with middle- and small-scale retailers across the United States.

General manager Michael Saifer, who has run the place for nearly 30 years, says even without the effects of this new wave of tariffs, damage has already been done.

"It’s the uncertainty that’s killing us," he said.

Clients in this business need supply, and even a medium-sized retail chain can't afford to shell out $100,000 for an order that could get hung up at the border and taxed. So the orders are on hold. Saifer says he's had to furlough staff and drop a shift.

The price of components — like steel fasteners and hard woods Saifer says are the pride of his business — have already gone up.

Minister LeBlanc's office says that the upcoming meeting in Washington between the international trade minister, Canada's lead negotiator and U.S. officials has been delayed by an hour. It's now slated for 11:30 a.m. ET.

As Canadians continue to wait for news of a concrete trade deal with the U.S., major businesses in industries like auto, steel and more are stuck in limbo, waiting to determine how they'll be affected — and whether they will get some reprieve.

Daniel Tisch, the president and CEO of the Ontario Chamber of Commerce, spoke with CBC News Network earlier and said he has four main questions about the looming deal.

"Does it clearly restore the competitiveness of the sectors Trump has targeted? Are any concessions Canada makes fair and reciprocal with US concessions?" he asked. "And when Trump inevitably breaks this deal, do we still have some leverage?"

Tisch also said he will be looking to see whether the deal creates a pathway for the extension of the Canada-U.S.-Mexico Agreement (CUSMA) on trade.

"We're hopeful that answers to at least a couple of those questions will be something we can all live with," he said.

Still, Tisch struck an optimistic tone, saying that Canada has remained "incredibly resilient" amid Trump's tariffs.

"We have to aggressively work to reduce our dependence on the United States of America," he said.

Most of the cars Canada builds are sold into the United States. Trump has repeatedly said he wants that to stop. The leaked details of the deal-in-negotiation suggest Ontario’s auto sector will continue to face tariffs, though at a lower rate.

It likely dooms the industry to a slow death, Daniel Tisch from the Ontario Chamber of Commerce told CBC.

The margins for automakers are tight. The current 25 per cent tariffs are money-losing. Lowering it to 15 per cent doesn’t change that math.

"Over the longer term, the business case becomes much less reliable," said Greig Mordue, a former Toyota executive who's now an associate professor at McMaster University. He points out the automakers have big investments in Canada, with assembly plants costing $2 billion to $3 billion to build, but some will get to a point where they’ll just cut their losses.

The Detroit Three automakers have already started moving vehicle assembling out of Canada to U.S. plants that have spare capacity. The GM plant in Ingersoll, Ont., has closed. The Stellantis plant in Brampton, Ont., is idled, and may be sold. A shift has been eliminated by Ford in Oakville, Ont.

Ontario's auto sector has been shrinking for decades, with fewer jobs and fewer vehicles produced. Now, with tariffs seemingly being baked in permanently, automakers will reassess the long term.

"I think that this may one day we'll look back and say this was the death knell," said Ian Lee from Carleton University's Sprott School of Business.

While most of the details and caveats of the proposed deal are still not known, you can bet in Ontario many are questioning how much longer the auto industry can survive with tariffs of any kind.

Canada-U.S. Trade Minister Dominic LeBlanc's office says he and Canada's lead negotiator, Janice Charette, are slated to meet with U.S. officials at the U.S. Trade Representative (USTR) offices in Washington, D.C, this morning at 10:30 a.m. ET.

CBC photographer Evan Mitsui here. I've been visiting Canadian businesses this week that could suffer under Section 338 tariffs if no deal is reached.

Guann Chen is a third-generation orchid farmer, with a massive, brand new greenhouse complex in St. Catharines, Ont., in the heart of Niagara's greenhouse belt. His live flowers are sold in grocery giants Loblaws, T&T and Metro, as well as in dozens of nurseries and flower shops across Ontario, but nearly half of what he grows is for the U.S. market. The Section 338 tariffs, in addition to dairy and alcohol, single out potted plants, bulbs and orchids.

For Chen, a levy on Canadian-grown plants represents an existential threat to a business built to serve American demand. Proximity to the border and the vast U.S. market is key for perishable goods like orchids, allowing Niagara (and Leamington to the west) to concentrate decades of greenhouse-growing expertise into an export industry worth hundreds of millions of dollars.

For him, the tariffs don't make sense, even though there are other, even bigger orchid operations in California.

"Orchids take years to grow, so you can't just, overnight, switch suppliers. They haven't thought it through," Chen said.

While it was expected that Washington would play host to a mere 30-minute meeting toward a forthcoming Canada-U.S. trade deal, negotiators instead spent hours in the U.S. Trade Representative (USTR) building as discussions lingered later into the evening.

While the deal to slash U.S. tariffs in exchange for Canadian concessions is still being finalized, there was a lot to learn from today's negotiations:

Canada-U.S.Trade Minister Dominic LeBlanc told reporters that negotiators were "very close" to a deal as he left the USTR office this afternoon. Last we've heard from CBC's Washington bureau, Canada's lead negotiator, Janice Charette, remained in the building for negotiations with her counterpart into the evening.

Some premiers weighed in on Prime Minister Mark Carney's request to put U.S. booze back on store shelves. N.L. Premier Tony Wakeham said all premiers agreed to the ask, but Quebec Premier Christine Fréchette said Quebec would follow suit if the deal is "globally positive."

Manitoba Premier Wab Kinew said he's willing to do it, but encouraged consumers to "buy the Canadian stuff instead." He described Carney coming close to begging premiers to return U.S. booze to shelves, which Nova Scotia Premier Tim Houston said was "not even close" to how the meeting went down.

Kinew also had choice words for American leadership, saying he thinks U.S. President Donald Trump is "very weak" and that the administration is "back on their heels." Kinew said that he doesn't expect to be satisfied with whatever deal is reached.

We still have yet to hear from some provincial leaders on the deal, like Ontario Premier Doug Ford, who has been outspoken about retaliations against U.S. tariffs.

A source with knowledge of the deal told CBC News that a lower tariff on Canadian steel will include a quota system, allowing only a set volume of imports into the U.S. at the lower tariff rate. Earlier, CBC reported the deal would lower tariffs on aluminum and steel to 25 per cent from the threatened 50 per cent. Discussions around related derivatives and exemptions continue.

We also learned from an industry source that a government official confirmed the forthcoming deal includes a change to how the government allocates dairy licences. While the details were not shared, the source said it could lead to an increase in the supply of U.S. dairy products on Canadian shelves.

An industry source told CBC News a government official confirmed that the potential Canada-U.S. trade agreement includes a change to the way dairy import licences are allocated by the government.

The details were not shared, but the source said it could mean retailers become eligible to receive import licences, which could lead to an increase in the supply of U.S. dairy products in Canadian retail stores.

A spokesperson for the B.C. Liquor Distribution Branch (BCLDB) said in an email response to CBC Thursday that the agency would continue to follow the B.C. government's directive to not import any U.S.-made liquor products.

The message linked out to a provincial government directive issued on March 10, 2025, explaining BCLDB's expanded response to U.S. tariffs.

"In British Columbia, warehouse inventory has been depleting as the existing inventory of U.S. liquor products continues to be available for purchase through B.C. Liquor Distribution Branch (BCLDB) wholesale distribution channels," the email reads.