After a meeting on Monday between US President Donald Trump and Japanese Prime Minister Shinzo Abe, the two countries agreed to a framework on Tuesday to expand trade, which would include negotiations on tariffs, The Japan Times reported.
Mr Trump said he turned down a meeting with the prime minister because he did not like Canada's dairy tariffs. "We won't sign a bad deal for Canadians", he added, saying his office had not requested a private meeting with Trump.
"That's the motherload, that's the big one", Trump told reporters. He said the USA team thinks the Canadian "negotiators have taken advantage of our country for a long time".
The current state of Canada's relationship with the United State due to the current NAFTA debate has been a rocky one, to say the least.
The Canadian leader added existing U.S. tariffs on Canadian steel and aluminium, which were implemented in late May, would have to be scrapped before Canada felt confident in signing a new NAFTA agreement.
Trump criticized the Canadian trade delegation for not striking a revised NAFTA deal, and in particular said he doesn't "like very much" its chief negotiator, Canadian Foreign Affairs Minister Chrystia Freeland.
"If it doesn't happen by the end of the week, we'll just keep working away and trying to get the best deal for Canada", David MacNaughton told a Toronto event arranged by Politico Canada.
"Yeah I did", president Trump answered.
Trump has demanded major changes to NAFTA, which he has said caused USA manufacturing jobs to move to low-wage Mexico.
The US trade representative, Robert Lighthizer - Freeland's counterpart at the talks - complained on Tuesday that Canada was not making enough concessions and warned that time was running out.
Washington and Mexico City last month announced agreement on a new trade pact, but a separate track of intensive talks with Canada have so far failed to produce results.
He also said he is still willing to put a "motherload" tariff on Canadian auto parts, which could affect $200bn of Canadian exports to the US.
Returning to criticizing Canada, he ripped America's neighbor to the north for a long-imposed tariff of almost 300 percent on some dairy products. "Canada has treated us very badly".
USA automakers and congressional aides now believe a deal with Canada is not possible by the deadline, which they said would most likely prompt the United States to move ahead with a bilateral agreement with Mexico. It's been great for Mexico.
In a lengthy press conference Wednesday, Trump said he rejected meeting Trudeau because of trade talks.