The U.S. commerce secretary says American and Japanese negotiators are making progress on the Trans-Pacific Partnership free trade deal.
But in a speech Tuesday in Tokyo, Penny Pritzker also said both sides need to be "bold and creative" to reach a breakthrough on the ambitious, 12-nation pact.
The U.S. has been urging Japan to reduce tariffs on agricultural imports, measures that are in place to protect politically important Japanese farmers.
The stalemate between Washington and Tokyo is seen as one of the major obstacles to reaching an agreement on the broader free trade deal.
White House officials say they hope to finalize the agreement by the end of the year, though several such deadlines have been missed already.
The TPP is a major part of President Barack Obama's attempt to refocus U.S. economic, diplomatic and security efforts on the Asia-Pacific.
The 12 countries included in the TPP negotiations account for about 40 percent of the world's economy and 26 percent of its trade.
In her speech to Japanese and U.S. business executives, Pritzker said the "timing is now for us to sort this out." She said the two sides are "a lot closer" to a deal than when President Obama visited Japan in April.
The TPP talks are expected to be on the agenda when Obama travels to Beijing next month for the Asia Pacific Economic Cooperation Summit.