The former Ajax striker joined the Premier League club in January 2011 for a reported £22.7 million fee and has been a revelation for the Merseyside club.
The 27-year-old was strongly linked with a move away from Anfield for each of the last two close-season transfer windows due to a lack of UEFA Champions League football and reportedly attempted to force through a move to Arsenal before the current campaign.
Liverpool stood firm and refused to sell Suarez and he has been a relevation since returning from a 10-man ban for biting Chelsea defender Branislav Ivanovic last season.
Brendan Rodgers' side are fourth in the Premier League table, just six points behind leaders Chelsea after hammering Arsenal 5-1 on Saturday, and Cavani has revealed his international team-mate is delighted he remained at Anfield.
"I speak with Luis most weeks - and he is loving life at Liverpool," Cavani said.
"When I speak with him now it sounds like a different man to that of last season. You can hear it in his voice how happy he is compared to last season.
"He has always loved Liverpool - things have not always gone well for him in England - and he told me how humbled he was by the way the club and the fans stood by him.
"All he wanted was to be at a team which matched his ambition, where he could play Champions League Football, and where he can compete for major trophies.
"Now Liverpool are in that place he is happy to stay."
Suarez has scored 23 goals in only 20 top-flight appearances since returning from his long suspension and Cavani is adamant he should be named player of the year.
"Of course he is player of the season in England,” Cavani declared. “I just hope that those who vote forget about the past - and just concentrate on the football."
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