Canada Won't Bet Its Trade Deal on the US Midterm Election

Canada is refusing to treat the Democrats' sweep of the US Congress as a shortcut to a trade agreement. On November 4, Canadian minister Dominic LeBlanc said the election result would not change Ottawa's approach to negotiations with Washington and that he expected to speak soon with senior American trade officials.

The political context shifted dramatically: Democrats took control of both the House and Senate after an election in which tariffs and the cost of living figured prominently. The commercial reality did not. Tariffs and negotiating positions remain in place until officials change them, while President Donald Trump retains substantial executive authority over trade.

Reporting: Reuters.

Ottawa is negotiating with the administration it still has

LeBlanc said he planned discussions with US Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer. Trump suggested a deal was close, while Prime Minister Mark Carney cautioned that important work remained and that Washington had withdrawn some demands. Those statements are not equivalent to a final text or a signed agreement.

Both governments have incentives to limit uncertainty for businesses that move goods across the border repeatedly. But leaders can face very different domestic demands, and a congressional shift can change negotiating pressure without guaranteeing that companies will see lower duties.

Reporting: Reuters.

The new trade figures explain the stakes

Data released on November 4 showed Canada's September merchandise trade surplus rising to C$5.35 billion, the biggest since May 2022, helped by stronger gold and energy exports. The bilateral surplus with the United States widened to C$12.3 billion. Such numbers may look encouraging, but they conceal uneven performance across sectors.

Canadian exports to the US rose modestly and more than 70% of Canada's exports went to the American market. Excluding gold and energy, global export values fell and export volumes declined. For exporters of machinery, consumer goods and other tariff-sensitive products, the headline surplus is a poor substitute for predictability.

Reporting: Associated Press.

Energy prices linked to the conflict with Iran also contributed to the higher value of energy shipments. That is not the same as a broad improvement in Canadian competitiveness. A volatile commodity price can lift national trade figures while leaving manufacturers with weaker orders or higher input costs.

What the new Congress can and cannot do

US lawmakers may use hearings, legislation and budget negotiations to question tariff policy. But a change in congressional control does not itself repeal every trade measure or determine the terms of a bilateral deal. The White House and US trade agencies remain central participants in negotiations.

Canada's measured reaction is therefore strategic rather than passive. Ottawa will continue talks with the current administration while assessing whether the new legislature changes leverage. The next material development is a disclosed agreement on market access, tariff treatment or dispute resolution—not a prediction based on election-night celebrations.