USMCA Review Proceeds Despite Trump's Doubts: Ebrard

Mexico's Minister of Economy Marcelo Ebrard confirmed USMCA review negotiations are continuing despite President Trump's public statements questioning the agreement's renewal, as the second bilateral round opens in Washington on June 16 covering agriculture and energy. The July 1 deadline under Article 34.7 is unlikely to produce a full resolution, with talks expected to enter a 10-year annual review cycle that could expose North American supply chains to prolonged regulatory uncertainty. Stakeholders across Mexico's export-dependent manufacturing and energy sectors face near-term risks tied to contested Section 232 tariffs, PEMEX investment rules, and potential shifts in rules of origin requirements.

Mexico's Minister of Economy Marcelo Ebrard confirmed that USMCA review negotiations remain on track, pushing back against public statements from US President Donald Trump last week casting doubt on the 32-year-old trade agreement's future. The second formal bilateral round of talks opened on June 16 in Washington, covering agriculture and energy, two of the most contested chapters in the review process.

"If the political decision were that the treaty should not be extended or remain in force, we would already know, we would have been told, and we would not be in formal conversations," Ebrard said. The minister noted that Mexico's government has been in office for more than a year, and that both countries continue to hold structured bilateral sessions, making any unannounced withdrawal from negotiations implausible.

Trump's Remarks Add Pressure to Talks

Trump last week declared he had no intention of renewing USMCA, asserting that the United States "needs nothing" from either Mexico or Canada, while both countries depend heavily on the US market. Trade analysts have questioned whether the remarks reflect a genuine policy shift or a negotiating posture designed to extract further concessions. Trump has expressed repeated frustration with the pact he signed in 2020 to replace NAFTA, pointing to persistent US trade deficits with both neighbors.

Ebrard acknowledged the complexity of the process, calling it neither "easy" nor "simple," but maintained that Mexico is presenting its positions from a framework of cooperation and mutual benefit for all three North American partners. He noted that approximately 85% of Mexico's exports to the United States enter duty-free under the agreement, a figure he said has been accepted by the US negotiating team as part of the bilateral dialogue.

Mexico also continues to contest Section 232 tariffs applied to automotive goods, steel, and aluminum, arguing those measures contravene the agreement and harm both economies. President Claudia Sheinbaum echoed that position, expressing confidence that the tariffs on steel, aluminum, and vehicles could be reduced, and indicating she would raise the issue directly with Trump by phone if necessary.

Agriculture and Energy at the Center

These recent closed-door sessions in Washington follow a first round held in Mexico City in late May, where US demands surfaced for a requirement that 50% of North American motor vehicle content originate specifically from the United States, a condition that would push the regional content threshold to 82%.

On agriculture, US farm groups are pressing for a 16-year extension with duty-free access for agricultural products, strengthened provisions for GMO corn and ethanol access in Mexico, and improved entry into Canada's dairy market. Mexico and Canada represent the two largest agricultural export markets for the United States, absorbing more than US$58.6 billion in US farm exports in 2025, more than one-third of the country's total global agricultural shipments. That share has grown as China has reduced purchases in response to US tariffs.

Despite that volume, the United States recorded agricultural trade deficits of US$13.2 billion with Mexico and US$11.1 billion with Canada in 2025. One proposed remedy is pressuring Mexico to allow ethanol blending with gasoline in major cities, a move the National Corn Growers Association estimates could add US$2 billion annually to US ethanol exports.

The energy chapter centers on a longstanding dispute over Mexico's policy of favoring state oil company PEMEX over private and foreign investors, a posture the American Petroleum Institute has described as a systematic use of USMCA's dispute resolution process to benefit PEMEX. The ANAPI has called for a rapid-response compliance mechanism modeled on the agreement's existing labor enforcement tools. In July 2022, the United States formally requested consultations under USMCA dispute settlement mechanisms, alleging Mexico's energy reforms discriminated against US firms in renewables, electricity, natural gas, and retail fuel.

July 1 Deadline and the Road Ahead

Under Art. 34.7 of USMCA, all three countries must decide by July 1 whether to extend the agreement unchanged or recommend modifications. A full resolution is not expected by that date. Instead, July 1 is expected to mark the start of a 10-year termination window during which negotiations would continue on an annual basism a scenario trade experts warn could give Trump grounds to invoke a separate withdrawal clause requiring only six months' written notice.

A third bilateral round between Mexico and the United States is scheduled for the week of July 20 in Mexico City. Ebrard said he expects to meet with US Trade Representative Jamieson Greer on June 18 to clarify next steps. Canada has remained outside the formal bilateral track, though Trade Minister Dominic LeBlanc continues to hold separate meetings with Greer.

The July 1 Free Trade Commission meeting, marking USMCA's sixth anniversary, will bring all three parties together and is expected to define the framework for the months of negotiation ahead.