BRUSSELS, DEC. 6 -- Global negotiations to expand free trade broke down in bitterness tonight over the issue of farm trade subsidies, making it extremely difficult for negotiators to reach a successful end Friday of a four-year effort to expand trade rules to cover $1 trillion in new forms of commerce.

The deadlock came after the negotiations received a sudden reprieve this afternoon when the 12-nation European Community agreed to discuss the $12 billion a year it pays farmers to help them sell in foreign markets.

But hours later the talks reached a stalemate when the EC, Japan and South Korea raised so many objections that other nations decided it was fruitless to continue negotiations on the General Agreement on Tariffs and Trade (GATT).

"They weren't forthcoming enough," said Jermain A. Denis, Canada's assistant deputy trade minister. "The EC just dug its feet into the ground like a mule," said Indian Commerce Minister Subramanian Swamy.

Deputy U.S. Trade Representative Julius Katz said the only chance of restarting the talks Friday "is a miracle overnight, which does not seem indicated."

"There obviously has been a very negative turn, following some early hopes. ... We'll see what happens tomorrow {Friday}," he added.

It remained unclear tonight whether the Europeans had reached their bottom line when the talks broke up or whether they were following their traditional negotiating pattern of waiting for the very end to come up with a final offer.

What was clear in these talks, however, was a change in the dynamics of the United States's position. U.S. officials for the first time since World War II said they were willing to let the talks fail if trading partners in Europe and Asia refused to come forward with concessions.

U.S. officials, who instigated the round in 1986 to encourage a new explosion of world economic growth, said they would consult with representatives of other nations to try to manage a graceful end to the talks Friday. Their hope is that a cooling-off period of a month or more will allow time to salvage the Uruguay Round, named for the country in which the talks were launched.

EC Agriculture Minister Ray MacSharry said that "expectations have been raised higher than can be delivered. There is absolutely no way to think that the suggestions made today can be achieved."

The impact of the breakdown of the farm trade talks was felt immediately in other negotiating groups. An American official said Argentine and Brazilian officials rushed into talks dealing with textiles to announce that the farm talks had collapsed.

"Our negotiations just disintegrated," the American said.

"The success of the round is directly contingent on success in agriculture," said Canadian Agriculture Minister Don Mazankowski.

"When agriculture foundered, all the other sectors foundered as well."

The Uruguay round was aimed at bringing GATT rules into new areas such as high technology, foreign investment, banking and insurance.

They have been dogged from the start, however, by an issue from the past -- farm trade.

Agriculture was not covered by the original GATT agreement 43 years ago, at the insistence of the United States, which now wants to bring it under the global trade rules.

The EC, with high subsidies going to its nearly 10 million farmers, has resisted reforming farm trade, as have Japan, which bans rice imports, and South Korea, which fears free trade would force its farmers out of business.

The day started on a note of gloom, with U.S. Trade Representative Carla A. Hills and Agriculture Secretary Clayton K. Yeutter separately saying that a suspension of the talks after three days of acrimonious bickering might cool negotiators' tempers and allow for better results later on.

But the EC weighed in quickly with hints that it was willing to be forthcoming on the farm trade issue, and new talks were set for late afternoon.

Those talks focused on a suggested draft prepared by Swedish Agriculture Minister Mats Hellstrom. The draft called for 30 percent reductions in government subsidies to farmers as well as a 30 percent decrease in barriers to farm imports from other countries.

A U.S. official said this draft was a basis for negotiation, even though the United States had some problems with it.

But EC officials attacked the plan. MacSharry called it "not acceptable. It's not a basis for negotiations."

EC spokesman John Cooney quoted French officials as calling the Hellstrom draft "monstrous," Portuguese officials said it is "shocking" and British officials noted "many deficiencies."

"It's a non-runner," said Cooney.

These views were reflected in the meeting of agriculture negotiators, which Katz described as "bitter at the end."