“We are pleased a deal has been reached that preserves Nafta’s trilateral framework, which is critical to protecting North American supply chains that support millions of American jobs,” Matt Shay, CEO of the National Retail Federation, said in a statement.
Dairy
U.S. dairy farmers will be able to ship more products to their northern neighbor, a prospect their Canadian peers don’t like. But even with increased access to Canadian dairy markets, the new deal could hurt Dean Foods Co., the biggest U.S. producer, according to Amit Sharma, an analyst at BMO Capital Markets. The agreement could boost demand and prices for raw milk that the company uses to make its products, such as ice cream, and reduce profit margins, Sharma said.
Metals
The steel and aluminum tariffs Trump imposed on Canada and Mexico remain. Canada and Mexico will push to resolve the levies over the next two months, leading up to the signing of the new USMCA deal, three people familiar with talks said, speaking on condition of anonymity. The import duties have boosted costs for metal users, including the construction industries, on both sides of the border.
Alcoa Corp., the largest U.S. aluminum producer, is “disappointed there was no resolution to the Section 232 tariffs on aluminum and we continue to call for a full exemption for Canada and our fair trading partners,” spokeswoman Monica Orbe said in emailed statement.
Pharma
U.S. pharmaceutical companies earned a victory with Canada’s agreement to allow them to their sell brand-name drugs for a decade -- up from eight years -- before facing competition from generics.
Rail
When Trump won the election, shares of Kansas City Southern declined because its railroads haul goods between Mexico and Canada on the so-called NAFTA highway. Its stock, along with other North American rail companies, rose on Monday with the risk to the trade zone being taken off the table.
Renewables
Clean-energy manufacturers with factories in Mexico, such as Enphase Energy Inc. and Acuity Brands Inc. are relieved because they rely on unfettered access to the U.S. and Canada, according to Jeffrey Osborne, an analyst at Cowen & Co.
Tech
The deal bars countries from forcing companies to store user information in servers based in the country where those consumers reside. This helps major cloud companies like Amazon.com Inc. and Alphabet Inc.’s Google, which sell storage to Canadian and Mexican companies and governments but don’t want to build out separate storage facilities in those countries. Some security and privacy advocates have expressed concern that including the provision could make non-Americans more susceptible to being monitored by U.S. security agencies like the NSA or CIA.
This article was provided by Bloomberg News.