Industry Stakeholders Discuss State of the USMCA at USTR Hearing

On December 3–5, the Office of the US Trade Representative (USTR) held a hearing on the six-year review of the United States-Mexico-Canada Agreement (USMCA), drawing testimony from a wide range of industry stakeholders, according to a summary from law firm Holland & Knight (12-11-25).

While some participants urged USTR to preserve the agreement’s current framework, many called for targeted updates, particularly stronger rules of origin, labor value content requirements, and tougher enforcement. Despite differing views, panelists broadly agreed that USMCA should be maintained.

Concerns over transshipment and circumvention of Section 232 tariffs surfaced repeatedly, especially from the automotive, steel and aluminum, and wood and lumber sectors. Industry representatives warned that non-market economies—most notably China—are exploiting USMCA by routing materials and components through Canada and Mexico, where minimal processing can qualify products for preferential treatment.

Wood and lumber industry representatives said current USMCA rules of origin are being used to sidestep US trade remedies and disadvantage domestic manufacturers. Holland & Knight said panelists cited examples of cabinet components (such as drawers and panels) shipped into Canada and Mexico for minimal assembly before entering the US market as finished products eligible for preferential treatment.

Industry groups urged USTR to adopt labor value content (LVC) rules for wood products similar to those used in the automotive sector and to modernize rules of origin for millwork and wood products. They also called for tighter enforcement, closer alignment of trade remedy rules among the three countries, and measures to limit foreign direct investment by foreign entities of concern (FEOC) in Canadian and Mexican wood products industries.