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rules of origin, dairy market ac- cess, and what the administration calls "economic security" provisions aimed at Chinese inputs into North American supply chains. The most realistic scenarios at this point are a protracted negotiation that produces an amended agreement or a slide into annual reviews under sustained uncertainty. Where the Negotiations Stand: Mexico Yes, Canada Not Yet The pre-review process has split into two bilateral tracks rather than one trilateral negotiation. On the U.S.– Mexico side, USTR Greer and Mexi- can Secretary of Economy Marcelo Ebrard formally launched discussions in March, and formal bilateral nego- tiations began the week of May 25 in Mexico City. Mexico has been a relatively cooperative counterpart, by delivering on security commit- ments, accommodating U.S. requests on enforcement, and signaling open- ness to tighter rules of origin. The U.S.–Canada track is a dif- ferent story. Canada made early concessions last year—rescinding its digital services tax, discussing softwood lumber quotas, and increasing defense spending—but talks have stalled. A near- agreement on steel, aluminum, and energy reportedly collapsed in October 2025, and no formal U.S.–Canada renewal talks are currently scheduled. Canada's chief trade negotiator has publicly described July 1 as "kind of a checkpoint," not a strict deadline. The Big Issues on the Table Several themes dominate the U.S. negotiating position, and electronics manufacturers should track every one of them. Steel and aluminum tariffs. The Section 232 met- als tariffs (covered in the first installment of this 40 SMT007 MAGAZINE I JUNE 2026 series) loom over everything. Roughly 32% of Mexi- can USMCA-compliant goods and 37% of Canadi- an goods still face Section 232 duties, and the U.S. steel industry is pushing hard for steel to count as "North American" only if it is melted and poured in the region—not merely finished there. Deputy USTR Jeffrey Goettman has publicly endorsed that view, telling the American Iron and Steel Institute conference that the administration wants "unified tariff borders" with Mexico and Canada on steel, aluminum, autos, and other sectors so there is no opportunity for tariff arbitrage. The "side door" concern. Goettman has identi- fied one of the biggest U.S. priorities as shutting down what he calls "the side door"—Asian manu-