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Canadian Prime Minister Mark Carney announced Tuesday that he and U.S. President Donald Trump have agreed to intensify trade negotiations, despite a recent escalation in tariff threats from Washington.

The agreement follows a day after President Trump signaled new punitive duties against Canada.

"We agreed to intensify negotiations in the coming weeks, and the team and myself look forward to doing that," Carney stated, cautioning that "all options were on the table" should the United States proceed with its latest tariff imposition.

The development comes as U.S. and Mexican trade negotiators engaged in a third round of bilateral talks aimed at revising the North American trade agreement.

Concurrently, the Trump administration unveiled new tariffs on nearly $20 billion worth of Canadian goods.

These measures were a direct response to Ottawa's retaliatory tariffs on U.S. autos, steel, aluminum, and liquor, alongside its high dairy tariffs.

This deepening rift has largely sidelined Canada in the ongoing United States-Mexico-Canada Agreement (USMCA) negotiations, with little movement toward concessions being observed.

Prime Minister Carney previously asserted that his government had presented comprehensive proposals to resolve trade disputes with Washington, arguing that President Trump's past tariffs violated the North American trade pact.

Meanwhile, Mexico has been lauded for its lack of retaliation to U.S. tariffs and its "pragmatic" approach to negotiations.

This includes efforts to align Mexico's export controls with those of the U.S., steps to protect intellectual property rights, and initiatives to curb the export of avocados grown on illegally deforested land.

President Trump clarified on Tuesday that his latest tariffs targeting Canada were not a response to wildfires, but rather a distinct measure addressing trade issues.

Trump said on Sunday that Canada “poisoned” U.S. air as smoke from wildfires in the Great White North swept across American states. He said he spoke with Carney and told him “you got to stop these fires from coming in and, you know, poisoning our air.”

Carney and Trump spoke in New Jersey at the World Cup Final. “Our air has been poisoned,” the president told reporters at Joint Base Andrews.