Talks between Canada and the U.S. collapsed late Friday-raising the prospect of an all-out trade war between neighbors with a nearly $900 billion-a-year trading relationship. The two sides blamed each other for the collapse, which renews questions about the future of the U.S.-Mexico-Canada Agreement, the WSJ's Amanda Coletta and Gavin Bade write.
Shortly after 11:30 p.m. on Friday, U.S. Trade Representative Jamieson Greer said Canada walked away from the table and had made unspecified new demands. As a result, tariffs of 50% on $20 billion worth of Canadian goods, or about 5% of its U.S.-bound exports, went into force after midnight.
Prime Minister Mark Carney said Canadian officials worked in good faith on a deal, but it was the U.S. that proposed new, unfair terms. Canada, he added, would slap dollar-for-dollar countertariffs on U.S. goods such as steel, dairy and appliances on Sept. 8, the day after Labor Day.
Negotiators were near a deal shortly after Trump extended a tariff deadline by three days last week that would have lowered U.S. tariffs on steel and aluminum from 50% to 25% and ease top-line auto tariffs from 25% to 15%. But pushback from U.S. industry and acrimony within the Trump administration helped derail those critical aspects of the deal. In addition, Carney said U.S. negotiators sought to exempt medium and heavy trucks from auto-tariff relief without "giving a rationale."
President Trump said his administration would allow up to 300,000 metric tons of ground beef to be imported into the U.S. without triggering higher tariffs for 90 days, in a move to ease high prices. (WSJ)
Canadian consumer spending, which has helped underpin a sluggish economy, stalled last month and snapped a run of rising retail trade through the first half of the year. (WSJ)
Global Trade
A fresh wave of businesses is considering transferring their rights to potential tariff-refund payouts, the WSJ's Jennifer Williams writes.
Last year, some companies sold their rights to tariff refunds for immediate cash. Some offloaded their claims before the Supreme Court struck down global tariffs this year. Others benefited from holding out: Price tags on certain refund claims have more than quadrupled since the ruling.
Interest in the deals surged after the court's ruling, and then slowed as companies waited to see how efficient the payout process would be. Before the Supreme Court's decision, selling refund rights often meant taking a massive haircut.
After, valuations of those claims ballooned to between 80 and 90 cents on the dollar, up from roughly 20 cents, according to one lawyer. With rates remaining high and companies still waiting for government payouts, the appeal of selling refund rights has returned for some.
Ocean Shipping
The Panama Canal Authority said it would limit the number of vessels allowed to transit the waterway in September to maintain shipping as water levels drop and a strong El Niño looms, raising the risk of delays and trade disruption.
The Authority said that, from Sept. 4, daily slots at the Neopanamax Locks would be limited to nine, with 25 slots open at the Panamax locks. Starting Sept. 15, the available Panamax slots will be further cut to 23. Some large containership liners have added surcharges and adjusted rates because of delays and surging costs to transit.
However, increasing limits to maximum draft due to take effect Aug. 26 and Sept. 3 in the Neopanamax locks will be postponed to Sept. 3 and Oct. 1, respectively, based on the current level of Gatun Lake and recent weather forecasts.
The Panama-flagged bulk carrier Ocean Winner sank in the Bay of Bengal after reportedly vanishing from tracking systems, triggering an operation to find and rescue the 24 crew members. (Times of India)
Moscow rejected a Ukrainian offer of a truce on strikes on ships carrying agricultural commodities through the Black Sea, Ukrainian President Volodymyr Zelensky said. (Bloomberg)
Number of the Day
Decline of inflows into the Panama Canal's watershed below the historical average during the current hydrological year, which started in May, according to the Panama Canal Authority.
In Other News
Business activity in the U.S., Europe and parts of Asia picked up despite headwinds from the war in the Middle East, surveys released Friday show. (WSJ)
The CDC urged consumers not to eat alfalfa sprouts sold under the Calco and Everything Sprouts brands amid an outbreak of E. coli and salmonella that has sickened dozens in 15 states. (WSJ)
UAW members voted down an offer from Deere to extend their contract by two years, setting up what could be contentious negotiations next year. (WSJ)
Federal auto-safety regulators are opening an investigation into nearly one million General Motors pickups and SUVs after receiving hundreds of reports of engine failures. (WSJ)
Nvidia is in advanced discussions to invest in Cloverleaf Infrastructure, a company that arranges power for data-center projects. (WSJ)
BJ's Wholesale Club raised its full-year profit outlook as lower gas prices and grocery deals drew more customers to its warehouses. (WSJ)
Walmart plans to launch Scenario, a new store brand of women's clothing and accessories, to appeal to younger, trendier shoppers. (WSJ)
Blackwater's Erik Prince launched Vectus Air Defense Systems to help protect critical infrastructure, energy installations and military bases from drone attacks. (WSJ)
Nibe Industrier said strong demand for heat pumps in Europe and the U.S.-despite the end of government subsidies-drove up the Swedish company's sales and profit. (WSJ)
The American Trucking Associations said it would start a search for a new CEO after Chris Spear said he was leaving the organization, effective immediately.
A warehouse owned by Russian online retailer Ozon was one of two industrial facilities hit by drones, according to the governor of the Orenburg region. (Moscow Times)
About Us
Mark R. Long is editor of WSJ Logistics Report. Reach him at mark.long@wsj.com. Follow the WSJ Logistics Report team on LinkedIn: Mark R. Long, Liz Young and Paul Berger.
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