President Donald Trump is indicating he may decline to renew the USMCA by the July 1 deadline, potentially shifting the North American trade pact into years of recurring reviews and renegotiation.
By yourNEWS Media Newsroom
President Donald Trump is signaling that the United States may decline to renew the United States-Mexico-Canada Agreement by the July 1 deadline, a move that could push the North American trade pact he negotiated during his first term into a prolonged cycle of annual reviews and renewed talks with Canada and Mexico.
The president’s position comes as trade disputes between Washington and its two largest regional partners have deepened, according to a Just the News report. Trump has continued to criticize U.S. trade deficits with both neighboring countries, even though the USMCA replaced the North American Free Trade Agreement during his first administration.
When the agreement was signed in January 2020, Trump praised it as a landmark trade deal.
“The USMCA is the largest, fairest, most balanced and modern trade agreement ever achieved,” the president said at the time. “There’s never been anything like it.”
But Trump is now expressing frustration with the pact’s results. Under the agreement’s review structure, the three countries must decide by July 1 whether to extend their commitment. If all three agree, the pact would continue for 16 years. If the United States withholds approval, the agreement would enter a period of rolling reviews and could expire in 2036 unless the parties reach new terms.
“I’m not looking to renew it,” Trump told reporters earlier this week.
“You know, with Mexico and Canada, we have trade deficits,” he said. “We should have surpluses with them. We don’t need their cars. We don’t need their lumber. We don’t need their energy. We don’t need anything that they have.”
By declining to commit to renewal, Trump would trigger a period of rolling reviews rather than immediately ending the deal. That structure would give the United States time to renegotiate with Canada and Mexico while placing the pact’s long-term future in doubt.
The current strain follows a series of tariff disputes that began early in Trump’s second term. In 2025, the administration imposed 25% tariffs on most Canadian and Mexican imports, citing fentanyl trafficking and illegal immigration. USMCA-compliant goods were exempted from the levies.
Mexico and Canada responded differently. Mexican President Claudia Sheinbaum moved to accommodate U.S. demands by cooperating in trade discussions, increasing security coordination with Washington against Mexican drug cartels and imposing tariffs of her own on other countries to make Mexico less attractive as a pass-through point for cheap goods entering the U.S. market.
Canada initially retaliated, as Mexico had also done, but Canadian trade tensions escalated further. Canada eventually faced a 35% U.S. tariff rate on non-USMCA goods.
The Trump administration’s concerns with Canada have expanded beyond tariffs. Canadian Prime Minister Mark Carney has sought to shift Canada’s trade posture away from heavy dependence on the United States by pursuing relationships with China, India and European partners.
Carney’s outreach to Beijing has become a particular concern for Washington. In January, he visited China and negotiated a new “strategic partnership” with the Communist regime, promising expanded trade and mutual investment.
Carney said the arrangement represented Canada “recalibrating” its relationship with China and would position the country for the “new world order,” in which Canada would seek greater distance from its southern neighbor, Just the News previously reported.
The administration has also raised objections involving Canadian dairy market access, softwood lumber, fentanyl and other drug trafficking cooperation, and Canada’s Digital Services Tax on U.S. technology companies.
Trump has also continued to focus on trade deficits. In 2025, the U.S. goods trade deficit with Mexico was $196.9 billion, up 14.8%, or $25.4 billion, from 2024, according to the Office of the U.S. Trade Representative. The goods trade deficit with Canada declined more than 25%, or about $15.5 billion, in 2025 to $46.4 billion as tariffs and trade barriers increased.
The Supreme Court’s decision earlier this year in Learning Resources, Inc. v. Trump also appears to have changed the administration’s negotiating position. The ruling limited Trump’s ability to use the International Emergency Economic Powers Act for sweeping tariffs, which had made up much of the duties imposed on trade with Mexico and Canada.
That decision has placed additional pressure on the July 1 deadline. At present, only Mexico is formally negotiating with the Trump administration over bilateral trade. U.S. and Canadian officials have held preliminary discussions, but formal negotiations have not begun.
The USMCA’s future carries major implications for industries built around cross-border production and investment. Since the agreement took effect in 2020, trade among the three countries has grown 37%, driven largely by industrial supplies and automotive investment. Mexico and Canada remain the top two U.S. trading partners, according to the most recent U.S. government data on Mexico and Canada.
Public opinion also shows broad support for the agreement. A Chicago Council on Global Affairs and Ipsos poll found that 75% of Americans believe the USMCA has been good for the U.S. economy. The same poll showed strong public belief that trade with Canada and Mexico benefits U.S. national security.
The auto industry is among the sectors most exposed to uncertainty. Since the 1965 Automotive Products Trade Agreement with Canada and the 1994 launch of NAFTA with Mexico, North American vehicle manufacturing has become deeply integrated.
The American Automotive Policy Council has called the USMCA “the most vital trade agreement for America’s automakers” and has asked the Trump administration to preserve the pact, even if some parts are renegotiated.
Agriculture, food products, textiles and cross-border capital investments could also face uncertainty if the agreement’s future remains unresolved.
Analysts have also warned that weakening North American trade ties could create openings for China to expand its role in regional markets. The USMCA’s rules-of-origin requirements are designed to prevent Beijing from using Mexican or Canadian re-export channels to bypass U.S. tariffs.
Trump’s decision on whether to renew the pact by July 1 could therefore determine whether USMCA remains on a stable long-term track or becomes the subject of years of recurring negotiations among the United States, Mexico and Canada.
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