Instead, a smaller deal could include new currency agreements, Chinese commitments on farm purchases and a halt on U.S. tariffs that are due to increase next week.
Total US agriculture exports were US$140 billion in 2018, so that increase would mean a third going to China. The deal will take three to five weeks to put on paper, officials said.
Shortly after the USA cash market opening on Thursday, President Donald Trump said he's meeting with Chinese Vice Premier Liu He on Friday, fueling optimism about a positive outcome from this week's high-level trade talks.
"As we have said throughout this trade war, we do not believe continuing to tax Americans gives us leverage at the negotiating table with China, and it is past time that these misguided tariffs were removed", he added.
Washington still is planning a December 15 tariff hike on $160 billion of smartphones and other imports.
"I believe that there's even the possibility of a currency agreement this week", Myron Brilliant, the head of worldwide affairs at the US Chamber of Commerce, told the media.
Trump hailed a breakthrough on an initial deal that included a surge in purchases of American farm products and also covers intellectual property, financial services and currencies.
Trump said that the deal was still "subject to getting written", but Treasury Secretary Steven Mnuchin confirmed that the scheduled tariff hike from 25 percent to 30 percent on October 15 would not take place as a result of the agreement. He said "phase two" will be negotiated after the first deal is drafted. Trump is set to meet with Chinese vice premier Liu He in the Oval Office Friday afternoon.
China's Vice Premier Liu He leaves the trade talks that are being held in Washington.
With the deal the White House will hold off on a massive tariff increase planned for next week, and as negotiations progress new tariffs planned for December also could be called off, U.S. officials said.
China has pledged to rapidly increase purchases of U.S. farm goods to US$40-50 billion (S$55 to S$68 billion) a year - a sharp rise that would be more than double the level in 2017.
China's exports to the United States, its biggest foreign market, have plunged, adding to pressure on Xi's government to shore up cooling economic growth and avoid politically risky job losses.
President Trump discusses the China trade agreement and its impact on farmers at a rally in Louisiana.
Trump said some IP issues would be left for later phases of the talks.
The major Asia Pacific stock indexes closed higher on Friday as investors remained optimistic that U.S.
China's official state-owned news organization Xinhua said that both sides "agreed to make the efforts towards a final agreement". Tensions between the USA and China escalated ahead of the discussions, with the US adding 28 entities to a blacklist.
The interim agreement also does not resolve some of the thorniest issues between the two countries, including whether the United States will continue to label China a currency manipulator and whether it will keep Huawei, the Chinese telecom giant, on a government blacklist.