"We had another good meeting today, officials are engaged now very intensively" said the Foreign Minister.
Canadian Foreign Minister Chrystia Freeland said that Mexico's "difficult" concessions to the United States on Monday would pave the way for productive talks this week as all three countries race toward a Friday deadline for a deal to modernize the 24-year-old North American Free Trade Agreement.
The pressure came one day after the US president again blasted the Canadian dairy industry during his announcement of a trade agreement with Mexico that he said could replace NAFTA.
"We recognize there is a possibility of getting there by Friday, but it is only a possibility because it will hinge on whether or not there is ultimately a good deal for Canada, a good deal for Canadians", Trudeau said at an event in northern Ontario. American negotiators know what Canada has already done on dairy in past trade deals: it gave the European countries greater access to the protected market in the Canada-EU trade deal, and it was willing to the do the same in the Trans-Pacific Partnership.
Details from the Office of the U.S. Trade Representative show the preliminary agreements include a wage provision that 40 to 45 per cent of auto content would be made by workers earning at least US$16 per hour, and increase in the auto content required from the NAFTA region to 75 per cent, up from the current 62.5 per cent.
Late Tuesday, the Globe and Mail reported that Ottawa was prepared to make concessions to Washington on Canada's dairy market. She and U.S. Trade Representative Robert Lighthizer had agreed to review progress early on August 30.
The prime minister said Canada is "determined to conclude an agreement that's equitable for all the concerned parties".
Freeland, who has been leading Ottawa's negotiating team this week in Washington, said she's optimistic about the "intense" talks now under way in the accelerated search compromise on NAFTA.
Negotiations between the three trade partners have dragged on for more than a year, putting pressure on the Mexican peso and the Canadian dollar both gained against the dollar after Monday's announcement.
Dairy is a politically charged issue that many analysts have predicted would be among the final conflicts to be addressed in the NAFTA renegotiation.
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"My position on defending supply management has not changed".
Trump emphasized that the term "NAFTA" was dead, eclipsed by the United States-Mexico Trade Agreement. Officials from the dairy lobby were unavailable for interviews.
The system has been in place since the 1970s and has survived several attempts to undo it.
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"It's time for our countries to resolve these issues and lock in an updated track agreement", said Steve Nelson, the group's president.
Joe Kinahan, chief market strategist at TD Ameritrade in Chicago, said: 'The question most people have is can the markets go higher?
"Canada's got a very small window here in which to step up, and we certainly encourage them to do that".
There is some urgency as the United States seems eager to have the issue resolved before the November midterm elections and Pena Nieto wants to sign it before handing the reins over to Lopez Obrador on December 1.
Mexican officials have insisted all along that NAFTA must be a trilateral deal and they have remained in Washington to participate in the talks.
"We had a NAFTA agreement that had gotten seriously out of whack, that led to large trade deficits and needed updating", Lighthizer said. Canada has used the provision to challenge U.S. anti-dumping and countervailing duties.