U.S. President Donald Trump said Tuesday he thinks Prime Minister Mark Carney and his team would “walk away very happy” after their latest visit to the White House, with the two countries getting closer to deals on steel, aluminum and energy.

‘Mutual love’ and ‘natural conflict’

The relationship between Canada and the U.S. is “more complicated,” Trump said, because the two countries share “mutual love” yet often compete for the same business—especially when it comes to steel and autos. “It’s a natural business conflict. Nothing wrong with it.”

Carney described it differently. “There are areas where we compete,” he said, “and it’s in those areas where we have to come to an agreement that works, but there are more areas where we are stronger together, and that’s what we’re focused on.”

Steel, aluminum and energy at top of the list

Dominic LeBlanc, the minister responsible for Canada-U.S. trade, told reporters later Tuesday that Carney and Trump had instructed their cabinet members to work quickly to secure deals related to steel and aluminum—both currently subject to 50 per cent U.S. tariffs. LeBlanc also said the two countries were working on “strengthening the energy partnership.” Canadian energy products that do not move through the United States-Mexico-Canada Agreement (USMCA) are currently subject to 10 per cent tariffs—a lower rate than the 35 per cent imposed on all other Canadian goods.

LeBlanc, who said he was staying behind in Washington, D.C., to continue negotiations, with meetings planned for as soon as Tuesday night and Wednesday, said he understands Canadians want to see a resolution as soon as possible. “Believe me, so do we,” he added.

‘We’ll get there’

In the Oval Office, Trump hinted the auto sector is where the two countries could reach some kind of compromise. “It’s a tough situation, because we want to make our cars here. At the same time, we want Canada to do well making cars. So, we’re working on formulas. I think we’ll get there.”

LeBlanc later suggested the “formulas” Trump referred to could come into play for steel and aluminum—the sectors where he said Canada expects to make quick progress. This could involve tariff rate quotas, which cap the amounts of steel and aluminum that could be traded without duties. But he cautioned against assuming that is the only option on the table. “There can be all kinds of formulas that are discussed in terms of investment, in terms of partnerships, in terms of joint ventures to develop certain industries together.”

During their media availability in the Oval Office, Carney reminded Trump that Canada is the biggest source of foreign investment in the U.S., adding that Canada is prepared to invest another US$1 trillion over the next five years—if it gets the “agreement we expect to get.” LeBlanc later suggested those decisions would be up to the private sector, including Canada’s large institutional investors.

The North American trade pact

The coming review of the agreement is expected to be contentious—especially when it comes to rules-of-origin thresholds in auto manufacturing and U.S. access to Canada’s tightly controlled dairy market. Last month, Carney and Mexican President Claudia Sheinbaum committed to keeping the trilateral deal going. On Tuesday, Trump was ambivalent: “We can renegotiate it and that would be good, or we could just do different deals.”

Canada’s global trade deficit grows

Canada’s merchandise trade deficit with the rest of the world widened in August to $6.3 billion, Statistics Canada reported Tuesday, up from $3.8 billion the month before. Exports fell by three per cent, largely driven by a decline in gold, silver, platinum and their alloys. It was the first month exports had dropped since an April collapse linked to Trump’s tariffs taking effect.

This story has been updated to add details, and quotes from Canada-U.S. Trade Minister Dominic LeBlanc.