A self-imposed deadline for a new US-Canada trade agreement passed on Friday with no resolution in sight, deepening uncertainty for industries reliant on cross-border commerce. The two nations have been locked in a six-month tariff war, with US duties on steel, aluminium, and automotive goods continuing to bite, while Canada maintains C$60bn in counter-tariffs.

As reported by Jessica Murphy for BBC, hopes for a breakthrough were dashed after US President Donald Trump criticised Canada’s recognition of a Palestinian state, further souring already fragile talks. Canadian Prime Minister Mark Carney remains firm, stating that “just any deal” won’t suffice, emphasising quality over speed.

Canada currently faces a 35% tariff rate, though some goods remain protected under existing agreements. Conservative leader Pierre Poilievre voiced disappointment over the missed deadline, urging stronger action to safeguard the economy.

Meanwhile, Canada’s trade minister Dominic LeBlanc told CBS News that talks have been “constructive and cordial” and confirmed that Trump and Carney are expected to reconnect in the coming days.

The Trump administration claims the tariffs are linked to Canada’s alleged failure to curb fentanyl trafficking—a charge Ottawa denies, citing only 1% of US fentanyl comes from Canada.