The 29-year-old originally joined Barcelona on a five-year deal from Liverpool in 2014.
The 29-year-old, who claimed the award for a second time after finishing top scorer across Europe last season, originally joined Barcelona on a five-year deal from Liverpool in 2014.
"Negotiations are moving along nicely in the right direction," Suarez told a press conference in Uruguay, where he is preparing for a World Cup qualifier with Ecuador on Thursday.
"Both parties want this deal to go through," said the centre-forward, who scored 40 Liga goals in 35 games last season and 59 goals from 53 games in all competitions.
Barcelona-based sports daily El Mundo Deportivo reported on Wednesday the Spanish champions had offered Suarez an improved deal until June 2021, two years beyond his current contract.
"Luis Suarez, ready," read its headline, while Marca also reported the imminent deal.
"His salary rise will be substantial," said Marca.
"Right now he earns 16 million euros ($17.6 million) a season, his new deal will push that to 25 million euros a season," it added.
Brazilian superstar Neymar signed a new five-year contract in late October that will keep him at Barcelona until 2021.
The deal, which had been agreed in June, includes a buy-out clause of up to 250 million euros as Barca seek to ward off interest from potential suitors.
Argentina's Lionel Messi is contracted to Barcelona until 2018 and will be offered a contract extension in the coming months, the club said recently.