USMCA figures prominently at GSDF 2026 event in New York City

Mexican and Canadian steel companies face uncertainties over the Trump Administration’s avowed position not to renew USMCA.

The renewal of the Mexico-Canada-Agreement (MCA) figured prominently in discussions at the recent Global Steel Dynamics Forum (GSDF) 2026, held in New York; the Association for Iron & Steel Technology and the World Steel Dynamics jointly organized the GSDF which had several steel-dedicated sessions, including one on MCA’s renewal.

Indeed, the GSDF staged a special panel discussion — a “trade roundtable”— on the USMCA with five participants exchanging views on the pros-and-cons of extending the pact in its present state; both Canada and Mexico want the agreement to be extended by another 16-years, although the Trump administration announced in advance that it would not renew the USMCA in its present form and called for addressing trade deficits and other shortcomings.

While the USMCA’s extension was not expected by the steel industries of all three countries, some business groups had been calling for a long-term extension of the pact to create certainty between the US and its top two trading partners. Renegotiating an agreement of this enormity to the satisfaction of the three partners, particularly the US which wants changes in the agreement, can be time-consuming and take months and “even years”, as one visiting Mexico businessman told me.

The forum examined the ongoing impact of unilateral US tariffs, including 50% tariffs under Section 232, with both Canada and Mexico leveraging the 2026 USMCA review to push for relief. Another issue linked to the main subject was “supply chain de-risking”, with the participants discussing strategies aimed at reducing reliance on non-market economies – China was the elephant in the room – by boosting integrated steel production within the North American trade bloc.

Canada and Mexico, hit by 50% US steel tariffs under Section 232, wanted the US to drop the tariffs, with leaders of both countries hoping to persuade the US that each of the three countries stood to benefit from a free trade zone. The US response had not been a positive one.

The impression gathered at the GSDF was that the US wanted major changes in the pact and, as some privately said, it might even withdraw from the USMCA if its conditions were not met.

Analysts feel that Mexico, compared to the combative Canadian approach, has taken a more conciliatory approach and has held multiple talks with the US, with steel tariffs figuring prominently in the talks.

This is also because of Mexico’s greater vulnerability to US tariffs; Mexico was the third-largest steel exporter to the US, shipping 3.5 million tons in 2024, or 12.2% of US steel imports, according to the US Commerce Department. Mexico’s exports have fallen since then, declining by 51.7% to 551,361 million tons in the first quarter of 2026 over the year earlier period. The general view of individual experts is that the U.S. and Mexico are closer to reaching an understanding; preliminary — Mexico trade negotiations have been more productive on steel, aluminum and autos, while only informal discussions were held with Canada.

In keynote remarks, Cleveland-Cliffs CEO Lourenco Goncalves suggested that Mexico understands what is at stake better than Canada. “Mexico is simple,” he said, “Shut down the back door (for transshipped steel imports). Canada talks a good game of ‘Fortress North America,’ but doesn’t follow through.” Goncalves added that it really would not even matter who the next US president is. “No Republican, no Democrat is going back to free trade!” he said.

Mark Millet, CEO of Steel Dynamics, ruled out a trilateral agreement as of now. “It looks like the US will make a deal with Mexico,” he said during an on-stage discussion.

USMCA Roundtable

While most speakers at the GSDF referred to the USMCA in passing, the special USMCA trade roundtable held a detailed discussion on the USMCA; the panelists included Philip Bell, the President/CEO, Steel Manufacturers’ Association; Catherine Cobden, President/CEO, Canadian Steel Producers’ Association; David Zabludowsky, Deputy Director, IQOM Strategic Advisors; and Alan Price, Partner, Wiley law firm. John Lichtenstein, managing partner at World Steel Dynamics, moderated the discussion.

Catherine Cobden, the President/CEO of the Canadian Steel Producers’ Association, defended Canada’s steel industry and said that her country took the steel trade enforcement “very seriously”. She highlighted the numerous steps taken by Canada to stop steel dumping, arguing that the measures aligned very much with the US position, reflected in the antidumping and countervailing duty actions taken against 31 countries.

Canada has also implemented a series of tariff rate quotas (TRQs) which allow import of pre-determined volumes at lower duties. Cobden added that the US Section 232 tariffs “don’t work perfectly for every region”.

David Zabludowsky, deputy director of IQOM Strategic Advisors, one of the panelists, said that Mexico’s priority has been to get the pact renewed; if the pact is not renewed, there would be a cost to pay. “Investments would be delayed until there is clarity on the rules of the road.” For Mexico, the top concern was the Section 232 tariffs, he emphasized. “There should be ample chance for some changes,” he said.

The GSDF was held before the July 1 review and the US refusal to renew the pact; preliminary US-Mexico talks were reportedly more productive around steel, aluminum and autos. The US held only informal discussions with Canada, according to Alan Price, partner at Wiley law firm.

Philip Bell, the President/CEO of the Steel Manufacturers’ Association, explained the reasons for retaining Section 232 tariffs. “I think there are several good reasons that we are keeping the 232 tariffs in place and that we are seeking significant changes to the USMCA.” He said that when looking at the region, the United States “is responsible for 85% of the Gross Domestic Product [GDP] generated within the USMCA region.” He observed: “So it shouldn’t come as any surprise if President Trump might be sitting in the oval office going, ‘Okay, we’re responsible for 85% of the GDP, then why on earth, are we having such high trade imbalances with Canada and Mexico?’”

Bell went on to say: “He (Trump) can also be saying, ‘Well, if we’re responsible for 85% of the GDP in the region, why isn’t there more American steel required in the domestic content requirements for automotive and other manufactured goods?’ He’s probably also thinking if we’re responsible for 85% of the GDP in this trading bloc, why aren’t there more American steelmaking jobs and American manufacturing jobs. So, if you’re President Trump, that is a very legitimate reason for keeping the 232 tariffs in place.”

Bell added that Section 232 tariffs allow the United States to negotiate from a position of strength. “This administration firmly believes that the ability to sell your steel in the United States is not a right. It’s a privilege, and it’s time for our trading partners to understand and appreciate that privilege, and to take their trading relationship with the United States more seriously.”

He contended that both Canada and Mexico “need to get tougher, and … align their trade policies with trade policies that work like the 232 tariffs and the 301 tariffs.”

In an AJOT-interview, Bell said that the US steel industry wants a USMCA that “works for all three countries”. “That is why the US administration has imposed Section 232 tariffs which can be changed after the US gets changes and the trade imbalance is resolved. The US wants to see more US steel sent to the export markets and get a fair share in terms of domestic content,” he said.

The US wants the agreement partners to adopt regulations that align with 232 and 301 tariffs and modify rules of origin to benefit US steel. The major concern of the US is to prevent third countries from using the USMCA to ship steel, produced outside North America, “through the back door,” as several steel executives have maintained.

“The United States did not agree to renew the USMCA in its current form,” US Trade Representative Jamieson Greer said in statement last week. But, he added, the US will continue to engage with Mexico and Canada to address the agreement’s shortcomings and US trade deficits with both partners, Greer said. The US will meet with Mexico the week of July 20 for a third round of bilateral negotiations related to the USMCA joint review.