The latest news, trends, analysis, interviews and podcasts from the global food and beverage industry

The US has declined to renew the US-Mexico-Canada Agreement (USMCA) in its current form, setting the stage for further negotiations with Canada and Mexico over the future of the North American trade pact.

The Office of the United States Trade Representative (USTR) said representatives from the three countries met virtually on 1 July 2026 for the agreement’s first joint review, as required under the terms of USMCA. Following the meeting, US Trade Representative Jamieson Greer said the US had not agreed to renew the agreement in its current form.

“As a result, the USMCA is not renewed,” Greer said in a statement. However, USTR said the agreement remains in force while the US continues discussions with Mexico and Canada, either until the issues are resolved or the agreement is terminated.

The Trump administration said it wants to address what it described as shortcomings in the agreement, as well as US trade deficits with Canada and Mexico. USTR also said the US is due to meet Mexico during the week of 20 July for a third round of bilateral negotiations linked to the USMCA review.

USMCA, which replaced NAFTA and entered into force in 2020, governs trade between the US, Mexico and Canada across sectors including agriculture, food, manufacturing, services and supply chains.

The decision not to renew the agreement without changes has drawn support from several agricultural, manufacturing and business groups, as well as lawmakers from both parties.

The National Milk Producers Federation and the US Dairy Export Council said that “getting USMCA right matters enormously” to the dairy sector, noting that Mexico and Canada account for more than 40% of US dairy exports by value.

The groups said they supported US government efforts to address unresolved trade challenges and called for “focused, intensive work” by all three countries to resolve them. They added that a stronger and durable USMCA would be important for the long-term prosperity of dairy producers and exporters across North America.

R-CALF USA CEO Bill Bullard said pursuing separate trade agreements with Canada and Mexico could provide an opportunity to address what the organisation views as long-standing weaknesses in both NAFTA and USMCA. He said those issues had contributed to the contraction of the US cattle industry.

The Consumer Brands Association said the review process gives the Trump administration an opportunity to take a more ambitious approach with Mexico and Canada, while supporting North American competitiveness and US manufacturing.

Several Republican lawmakers also backed the administration’s decision. Senator Pete Ricketts said Mexico and Canada are Nebraska’s two largest export markets and that existing trade relationships should be maintained, but added that issues in the current agreement need to be resolved.

House Ways and Means Committee chairman Jason Smith said Mexico and Canada had not fully upheld their commitments under the agreement. He cited concerns including Canada’s treatment of US dairy farmers and Mexico’s policies affecting US investors in sectors such as energy.

Representative Adrian Smith said the decision should be seen as an opportunity to strengthen enforcement rather than a termination of the agreement. Representative Claudia Tenney also said she supported USMCA but argued that concerns around Canada’s treatment of US wineries, dairy farmers and fruit and vegetable producers should be addressed before renewal.

Some Democratic lawmakers have also called for changes to the pact. Representative Rosa DeLauro said USMCA had failed American workers, arguing that trade deficits with Mexico and Canada had increased and that imports had put pressure on sectors including autos, steel and aerospace.

Representative Chris Deluzio said USMCA had included loopholes that benefited manufacturing in Mexico while weakening US factory towns. He said any future agreement should include stronger pro-worker reforms.

The joint review now moves USMCA into a new phase of negotiations, with agriculture, manufacturing, market access, enforcement and supply chains expected to remain central issues in talks between the three countries.