Trade Minister Don Farrell is confident the stalled deal is close to being secured after constructive discussions with EU commissioners.
"We're closer than we have been in 25 years to getting a free-trade agreement with the Europeans," Senator Farrell told Sky News on Sunday.
"Unfortunately, I can't say that we have an agreement yet, but we have significantly reduced the issues between us."
The pact will mean the end of tariffs on products like European cars in Australia.
The two-day negotiations took place in Brussels before Senator Farrell arrived back in Australia on Saturday night.
Negotiations over a proposed free-trade agreement have previously ended without a deal over sticking points that include greater access to European markets for Australian beef and sheep.
Australia initially pushed for more than 30,000 tonnes of beef, while Europe tried to whittle down the quota to protect domestic farmers who oppose greater competition from imports.
In turn, EU officials have pushed to end Australian producers using terms like prosecco and feta for products that aren't sourced from specific European regions.
Despite Senator Farrell's bullish tone, he admitted that negotiators were still at an impasse over certain import restrictions.
"That was an issue that continued to be discussed extensively on Friday, so we haven't resolved those yet," Senator Farrell said.
A free-trade deal would give Australian exporters greater access to global markets of more than 450 million people, while also removing tariffs on European imports and offering a potential billion-dollar boost to the economy.
The deal could be struck within weeks, Senator Farrell said, pulling Australia and the EU closer together as US President Donald Trump up-ends global trade with unilateral tariffs.
The news comes months after EU trade commissioner Maros Sefcovic travelled to Australia, where he revealed the final stages of negotiations could be finalised in 2026.
