USMCA Review Negotiations: The 4 US Demands That Will Hit Your Cross-Border Operations

The USMCA joint review has moved from a single deadline to a negotiation in rounds. Since late May, the United States and Mexico have held three bilateral rounds covering rules of origin, steel and aluminum, the automotive sector, labor, agriculture, and economic security. On July 1, the United States declined to confirm a new sixteen-year term, which placed the agreement in a cycle of annual joint reviews while it remains fully in force.

For anyone moving goods across the US-Mexico border, the practical consequence is a rulebook that can change a little every year. Across 122 years at this border, more than 190,000 customs operations a year, and 39+ ports, we have seen how small, continuous changes compound across pedimentos, certificates of origin, and audit cycles. This piece tracks where the negotiations stand and the four US demand lines with the most direct effect on how a shipment is classified, certified, and documented.

Where the USMCA negotiations stand

The United States and Mexico announced the series of bilateral negotiating rounds on May 27, 2026 (USTR, May 27, 2026). The calendar so far:

1. Round 1, May 28 and 29, Mexico City. Automotive rules of origin, steel and aluminum, economic security, and regulatory compatibility for medical devices, pharmaceuticals, and cosmetics (USTR, May 29, 2026).
2. Round 2, Washington, concluded June 18. The teams advanced rules of origin for certain industrial goods and economic security, opened talks on agriculture, labor, and environment, addressed steel, aluminum, and automobiles, and agreed to a committee on Chapter 12 implementation (joint statement, June 18, 2026).
3. July 1 joint review. The United States did not accept renewal of the agreement in its current form, and the agreement remains in force while open issues are resolved (USTR, July 1, 2026). We cover what the annual cycle means for planning in what the annual review cycle changes for your operation.
4. Round 3, Mexico City, week of July 20. Closed on July 23 with a joint statement covering economic security, labor, agriculture, electronic payment services, steel, aluminum and derivatives, and the automotive sector (joint statement, July 23, 2026).
5. Round 4, Washington. The July statement placed it in September. Mexico's Secretaría de Economía has since indicated it will take place in October, with the date to be announced by both governments.

The 4 US demand lines that matter operationally

The United States has set out its objectives in the 2026 Trade Policy Agenda and in each joint statement. Four of those lines reach directly into the shipment file:

1️⃣ Tighter rules of origin, especially in automotive
2️⃣ Steel and aluminum sourcing and anti-transshipment provisions
3️⃣ Labor compliance under Chapter 23, Annex 23-A, and the Rapid Response Labor Mechanism
4️⃣ Economic security, meaning the treatment of inputs from outside the region

Other topics on the table, such as agriculture and regulatory compatibility, matter a great deal for specific sectors. These four cut across almost every manufacturing supply chain that relies on USMCA preference.

Rules of origin: what tightening could mean for automotive

USMCA already carries demanding automotive rules of origin: 75% regional value content (RVC) for passenger vehicles and light trucks, a 70% North American steel and aluminum purchase requirement, and a labor value content requirement tied to production at facilities paying at least $16 USD per hour (Congressional Research Service).

The 2026 Trade Policy Agenda lists reinforced rules of origin in strategic sectors and enforceable provisions against transshipment as review objectives (USTR 2026 Trade Policy Agenda). In parallel, the US International Trade Commission has opened a factfinding investigation into the economic impact of the automotive rules of origin (USITC press release).

At the operational level, any increase in the RVC threshold lands first on Tier 2 and Tier 3 suppliers, who calculate origin with the thinnest margins. Programs that qualify today through aggressive roll-up calculations would face harder scrutiny. Tighter definitions of transshipment would also bring closer review of non-regional components that enter Mexico under PROSEC or IMMEX and are incorporated into vehicles destined for the United States. We look at how these rules could move in the three rules-of-origin changes that define your tariff exposure.

The operational read: every USMCA certification of origin issued in 2026 needs a paper trail that would hold up in a later verification, whatever rules are in force by then. That means tracking the bill of materials at a deeper level than most current processes require.

Steel and aluminum: the transshipment focus

Steel, aluminum, and their derivatives have appeared in every joint statement since the rounds began. The US concern centers on non-regional metal reaching the United States through Mexico under USMCA preference, and it already shapes enforcement under Section 232, which applies to derivative products according to their metal content. Mexico has moved on its own side with steel import controls.

Two outcomes are worth planning for. The first is a melt-and-pour standard that traces steel to the country where it was first melted and poured, extended into USMCA preferential treatment. The second is a volume mechanism, such as a tariff-rate quota, that caps preferential entry of Mexican-origin steel and aluminum, with volumes above the cap facing Section 232 duties.

For importers and IMMEX operators in steel-adjacent sectors (automotive bodies, construction, electrical conductors, white goods), either outcome moves the documentation burden upstream. You will need melt-and-pour evidence from suppliers alongside regional value support, and the cost predictability of USMCA preference weakens if a quota can fill during the year. Steel and aluminum are among the most enforcement-active categories we handle, and we see that every week in our Laredo and Nogales operations.

A landed cost model that treats USMCA as a simple yes-or-no switch will miss these scenarios. Our free tariff simulator at tariffs.joffroy.com lets you model how duty changes would hit your specific HTS codes, and we update it as the negotiations move.

Labor compliance: Annex 23-A and the Rapid Response Labor Mechanism

Chapter 23 of USMCA and its Annex 23-A commit Mexico to labor laws that guarantee freedom of association and collective bargaining, including verification of collective bargaining agreements (US Department of Labor). The Facility-Specific Rapid Response Labor Mechanism in Chapter 31, Annex A, lets the United States challenge denials of those rights at individual facilities, with remedies that include suspension of preferential treatment and denial of entry (USTR, Chapter 31 Annex A).

Labor entered the bilateral talks in round 2 and was on the agenda again in round 3. The mechanism is also active on its own track: in March 2026 a panel found a "severe" denial of rights at Orla Mining's Minera Camino Rojo facility (USTR press release).

For a CFO or trade director, this widens the risk profile to every Mexican supplier facility in your origin calculation. A successful case against one supplier facility can suspend preference on goods from that facility. The compliance question now covers your own plant and extends to whether you can document that each supplier facility in the calculation would pass the same review.

Economic security: inputs from outside the region

Economic security has been on the agenda of every round. In practice, it refers to how much non-party content a good can carry and still benefit from the agreement, and to coordination on trade measures toward non-market economies. Mexico has already moved in that direction with higher tariffs on imports from countries without a trade agreement, which we cover in the origin decision behind Mexico's tariff wall.

Companies whose bills of materials depend on Asian inputs are the most exposed to any agreement in this area. The first step is visibility: knowing which components come from outside the region, under which program they enter Mexico, and how much weight they carry in each origin calculation.

What companies should be doing now

The negotiations move slowly in public, and each round can bring commitments that take effect quickly. Three operational moves we are advising our clients to make:

1️⃣ Audit your USMCA certifications of origin for the top 20 HTS codes you import or export. Pull the bill of materials, walk the supplier chain back two tiers, and document the regional value content calculation with the supporting purchase records. A current file absorbs any rule change far better than one rebuilt under pressure, and it is the basis for proving origin in a verification.

2️⃣ Inventory your steel and aluminum exposure end to end. For every HTS code with steel or aluminum content, document the melt-and-pour country along with the country of last substantial transformation. Start the supplier request now, since it typically takes three to six months to operationalize.

3️⃣ Map your supplier labor risk. For each Mexican manufacturing facility in your origin calculation, confirm that it has a legitimated collective bargaining agreement under the Mexican labor reform, that the worker vote is on file, and that no complaint is open at the facility.

We help clients run all three audits. If you want a structured readiness review against these four demand lines, talk to a Joffroy expert.

How we work the review at Joffroy

We hold three Mexican Patentes Nacionales (Monterrey, Nogales, Manzanillo) and a US Corporate Customs Brokerage License, and we operate across 39+ ports between the two countries with a 99.8% accuracy rate. The operations we clear each year touch most of the HTS chapters these demand lines could reshape.

For our team, the review is a working file. Our regulatory intelligence stream monitors DOF, SAT, USTR, CBP, and the Federal Register every business day and translates proposed changes into operational impact for clients as soon as they are published. We have worked this corridor through the Maquiladora program, NAFTA, and USMCA, and a decade of annual reviews calls for the same discipline: documentation depth, supplier visibility, and a reading of the rulebook in primary sources.

We will update this piece as the fourth round is confirmed and its results are published.

TRADE. UNDER CONTROL.

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