The U.S. has started delivering its bombshell demands at NAFTA talks

The United States has begun dropping its bombshell proposals at the negotiating table in NAFTA talks, which are now entering their most difficult phase.

Sources say U.S. negotiators presented on Wednesday evening a so-called termination clause that would kill the pact after five years if the three member countries fail to renew it.

The next big drop could occur Friday: the group handling rules for auto parts is gathering and it's expected the U.S. will level demands seen as non-starters by the other parties.

This is after the U.S. at the last negotiating round proposed a rule that would seriously increase the use of Buy American provisions for public works contracts.

Canada, Mexico and industry groups have blasted some of the American proposals as impractical, even impossible.

U.S. Commerce Secretary Wilbur Ross has hinted that the toughest proposals are coming, though he says he remains optimistic the parties can achieve a deal.