Shippers Focus on USMCA Review: Three Key Recommendations

Shippers must closely monitor and understand the ongoing discussions surrounding the USMCA to respond quickly to changes and plan ahead, said James Kim, international trade partner at ArentFox Schiff, during the Supply Chain Dive event "Supply Chain Outlook: 2026 Trends and Risks" held on July 15.

Leaders of the three countries met earlier this month to initiatea joint review process of the trilateral trade agreement, which is currently set to expire in 2036. The United States, Mexico, and Canadadid not immediately extend the agreement by 16 yearsbut instead chose to initiate the annual review process.

According to Brian Janovitz, national security and global trade partner at DLA Piper, the U.S. currently dominates most of the negotiations. U.S.-Mexico talks have been conducted in a "relatively intensive format," and he further noted that "there is still a lot of work to be done." Meanwhile, U.S.-Canada dialogue "has largely not yet begun, aside from some routine communications."

"So, in terms of offensive interests, what is really on the table is U.S. interests," Janovitz said.

The outcome of the USMCA review will have lasting impacts on key industries such as steel, aluminum, dairy, and agriculture. Electronics, semiconductors, and critical minerals sectors may also be affected.

"Aerospace, chemicals, softwood lumber (a long-standing sore point between the U.S. and Canada)—these are just some of the industries that could change or be affected by ongoing USMCA negotiations and discussions," Kim said.

Before a U.S.-Mexico-Canada agreement is reached, here are three recommendations shippers should know about the current trade talks.

1. Leverage current USMCA trade rules

Shippers must master the current USMCA rules of origin applicable to their products.

According to Kim, many companies may assume that because they import from Canada or Mexico, they automatically qualify for USMCA exemptions, but that is not always the case.

Once shippers fully understand which rules apply, they can better understand how USMCA discussions may affect their business, including transportation and import operations, as well as potential tariffs. Companies can then assess their risk exposure and develop response plans based on the progress of negotiations.

"Finally, I think what really matters is closely monitoring these discussions and the dynamics of overall trade policy to stay on top of changes and react relatively quickly, while planning ahead," Kim said.

2. Understand that trade policy priorities are shifting

This time, trade priorities are different. Compared to the past, national security is being significantly emphasized, which differs from traditional economic considerations, Janovitz said. These differences will be reflected in areas such as export control coordination and tariffs on industries "deemed sensitive."

Tariffs also cast a shadow over USMCA discussions, Kim said. This is particularly prominent in rules of origin—which determine which goods qualify for USMCA treatment and often determine which goods are subject to tariffs.

Kim noted that the USMCA providesno exemption for Section 232 steel, aluminum, and copper tariffs. However, in May of this year, the U.S. Department of Commerce provided a process forCanadian and Mexican steel and aluminum producersto apply for reduced Section 232 tariffs.

Kim further noted that certain USMCA-eligible automotive parts also have partial or full relief. However, the U.S. has made proposals to Mexico to raise the regional content requirement for vehicles from 75% to 82% to qualify for the agreement.

3. Ensure supply chains are optimized

As rules become increasingly complex and change more frequently, ensuring that supply chains are optimized to serve a company's commercial goals is crucial, Janovitz said.

"There is a lot that can be done in this regard," Janovitz said, "partly in understanding the rules and their impact on company operations, and partly in addressing things proactively."