Canada and the South American mercosur bloc are advancing rapidly toward a free-trade agreement that officials say could be signed later this year. A further round of negotiations is scheduled for next month in Brasilia, and government officials from Canada, Argentina and Brazil expect the deal to be concluded in 2026. Ottawa is pushing the talks to diversify trading partners amid tariff uncertainty and to deepen access to markets for exports such as beef, soy and minerals.
Mercosur negotiations accelerate
Government officials from Canada, Argentina and Brazil told negotiators the discussions are moving at an unusually fast pace after talks formally restarted roughly a year ago following a stall since 2021. One Argentine government official said a signing is expected in September or October, while another diplomat based in Brazil described the negotiations as progressing extremely well and likely to produce an agreement this year. Negotiators have arranged another round next month in Brasilia, seen by officials as a key opportunity to resolve outstanding technical issues.
Reactions from Ottawa and Ontario
Prime Minister Mark Carney is expected to visit Brazil in the next quarter, and officials expect the trip could help push toward a final agreement even if no announcement is planned during the visit. Canada has intensified efforts to diversify trade amid uncertainty tied to tariffs imposed by U. S. President Donald Trump, and Brazil is described by officials as a trade partner Canada cannot do without. For Mercosur, whose members include Argentina, Brazil, Paraguay and Uruguay with Bolivia expected to become a full member in 2028, a deal with Canada would broaden access to developed markets and aim to attract investment in sectors such as mining.
Victor Fedeli, Ontario’s Minister of Economic Development, Job Creation and Trade, described provincial outreach as part of that momentum. “We’re building on that momentum, ” Fedeli said, adding that “The Canadian government is serious about diversifying away from the U. S., working to unlock new opportunities for trade, partnership, and investment. ” Fedeli travelled to Argentina and Uruguay earlier this month to lay groundwork and met technology and mining industry representatives as part of the push.
What comes next
Negotiators will meet in Brasilia next month to press for closure on outstanding points; officials expect the broader process could be concluded in 2026 even as one official floated a possible signing in September or October. The renewed momentum follows months of technical exchanges after Canada and mercosur agreed last year to relaunch stalled talks. At the same time, the European Commission has said key trade elements of its own accord with Mercosur will apply provisionally from May 1, underscoring shifting trade dynamics for the South American bloc.
If the Brasilia round produces progress on the remaining technical issues, officials expect follow-up activity aimed at final signatures and implementation planning. Ottawa and Mercosur actors will likely focus next on detailed schedules for tariff commitments and sectoral access, and stakeholders in mining and agriculture will be watching how commitments translate into market opportunities for both Canadian firms and Mercosur exporters.
