The United States, Mexico, and Canada will not immediately extend the free trade agreement among the three countries for another 16 years, as the parties continue consultations on possible adjustments to the agreement.

The leaders of the three countries held a virtual meeting on Wednesday, officially launching the joint review process of the United States-Mexico-Canada Agreement (USMCA), which is required by the agreement itself.

Mexico's Economy Minister Marcelo Ebrard said in a video posted on platform X that during the meeting, U.S. Trade Representative Jamieson Greer told his counterparts—Mexico's Economy Minister Marcelo Ebrard and Canada's Minister of Trade Affairs with the United States, Dominic LeBlanc—that the U.S. side will not extend the agreement for another 16 years at this stage.

After the meeting, Greer issued a similar statement, noting that the United States refuses to renew the agreement as is, but the agreement will remain in effect at least until 2036 pending further negotiations. LeBlanc emphasized in another statement that Canada had advocated for renewal, noting that the agreement remains fully in force and that extension is still possible in the future.

Since the three countries failed to unanimously agree to renew the agreement under existing terms, they will enter negotiations over the next year until the next review deadline on July 1, 2027. At that time, the three countries will meet again to decide whether to renew or whether another year of negotiations is needed.

Under this rolling annual review process, the agreement can be extended at any point. The process will repeat annually until the three countries reach consensus or the agreement expires in 2036. If an agreement is reached, the expiration date will be set 16 years from that date, with the next joint review occurring six years later. For example, if the three countries agree to renew next July, the expiration date would move to 2043, and the next joint review would take place in 2033.

"This is where the real work begins, right? So, this announcement means countries will move into more substantive discussions about where USMCA is headed and whether changes must be made," James Kim, an international trade lawyer at ArentFox Schiff, told Supply Chain Dive.

Mexico's Economy Minister Marcelo Ebrard said on X on Wednesday that during the rolling annual review process, countries will work to resolve a series of long-standing issues in the agreement, and some agreements may be reached during the transition period, but without a specific timeline.

"We are not in a hurry, but we also do not want any uncertainty, which is why we need to work toward agreement on many issues where work has already been underway for months," Ebrard said.

The three trading partners had previously held preliminary bilateral talks before Wednesday's deadline. Greer and Ebrard confirmed on Wednesday that the United States and Mexico will hold another round of discussions on July 20. It remains unclear when the United States or Mexico will hold talks with Canada.

"We agree that it is important to continue discussions and determine how to ensure that the trade and investment framework between Canada, the United States, and Mexico continues to support North American prosperity and competitiveness," Canada's Minister of Trade Affairs with the United States, Dominic LeBlanc, said in a statement on Wednesday. "For Canada, this includes substantive discussions with the United States on resolving sectoral tariffs on Canadian steel, aluminum, automobiles, and lumber."

The outcome of Wednesday's discussions was not surprising, especially from the U.S. perspective. U.S. President Donald Trump has repeatedly expressed willingness to withdraw from the agreement, telling reporters in mid-June, "I'd rather not have it signed. I'd rather it be terminated."

According to Ebrard, despite Trump's threats to withdraw from the agreement, there was no indication on Wednesday that any of the three countries plans to withdraw.

Meanwhile, U.S. Trade Representative Jamieson Greer told Congress in December that the United States will not accept the agreement as is, but will push for key modifications related to rules of origin, offshoring, tariffs, export controls, and critical mineral production, among other priorities.

Mexico and Canada, while more favorable to the agreement than the current U.S. administration, have also listed their own negotiation priorities after consulting with industry stakeholders.

According to a report from Mexico's Ministry of Economy, some of the broad issues Mexican stakeholders want to address include: improving the implementation and enforcement of the agreement's provisions, ensuring that existing mechanisms are durable and enforced, and promoting "productive integration."

Mexico has also indicated that certain industries have proposed different approaches to rules of origin, while many industries are concerned about U.S. Section 232 tariffs, which target sectors such as steel and aluminum.

Meanwhile, according to a report from Global Affairs Canada, Canadian stakeholders are pushing for continued duty-free market access among the three trading partners and for preventing any party from taking unilateral trade actions. Canada is also calling for the restoration of the previous de minimis duty-free threshold for U.S. imports. Previously, under this rule, imports valued below $800 were exempt from tariffs, but the Trump administration eliminated this last summer.

Canadian stakeholders are also seeking more harmonized tariff, origin verification, and duty treatment procedures, as well as greater coordination on requirements such as cross-border data flows and artificial intelligence governance. Finally, Canadian stakeholders urge pragmatic modifications to rules of origin so as not to harm North American integrated supply chains that rely on global inputs or cross-border production.