Mr FORREST —My question is addressed to the Minister for Primary Industries and Energy. The grain growers of my electorate of Mallee have taken an active interest in your recent visit to the European Union, Minister, and particularly your discussions regarding grain subsidies. Would you please report to the parliament on how progress is proceeding in reform of the common agricultural policy and the nature of your discussions with the European Union?

Mr ANDERSON —I thank the honourable member for his question. I know that he has been very concerned about the impact of the subsidies by the Europeans and the Americans on international grain prices and has raised the matter very often in this place. It is of concern. It costs Australian wheat producers and grain producers in general a lot of money, and it costs the national economy a lot of money.

I had the opportunity in Rome to meet with the US Secretary for Agriculture, Dan Glickman, who made it plain to me that he is very keen to avoid the re-emergence or the opening up again of the use of the export enhancement program for wheat sales from the US, that he feels that at this stage there is no pressure on him to do so and that he is very hopeful that the Europeans are of a like mind. We have seen in recent times the use of some subsidies by the Europeans. It is ironic that only a few months ago they were taxing exports because they did not want exports and now they are back into subsidising them again. But there does seem to be a willingness to acknowledge that it is in nobody's interest to open the whole thing up again and to initiate another trade war.

I was interested to note that Minister Borchert from Germany acknowledges, as does Commissioner Franz Fischler, that there is a need for reform of the CAP and that both of them feel that over time real reform can be effective and that they will move down the road, as I understand the case to be, of decoupling. I made the point—in response to their concerns that agriculture in Europe is about more than farm production, it is a multivalue thing; they are concerned about preserving the environment and keeping people in rural areas, for example—that it is their business whether they support them but, in so doing, they ought to seek to do so in ways that do not impact on our values, viability, environmental aspects and the rural population aspects and concerns that we have about farmers and rural communities in this country. That point seemed to be well made.

We have not made as much progress yet as we would like to make, but it is trending in the right direction. I note with great relief that wheat prices have picked up somewhat in the last week and the slide of recent times seems to be turning around. As I just commented a little while ago to the Treasurer, it looks as though it is worth an extra $200 million or $300 million to the external account as well.

Mr Howard —Mr Speaker, I ask that further questions be placed on the Notice Paper .