Copa-Cogeca secretary- general Pekka Pesonen went on to warn investment in the EU agriculture sector must be stepped up in Europe if it is to reach its production potential and make use of the increasing market opportunities.
The first estimates for 2012 by the EU statistical office Eurostat, show agricultural income in the EU-27 climbed by only 0.5% in real terms, compared to 2011. Agricultural employment also continued to drop by 0.5%. As a result, income per worker went up by 1%.
The slight rise in incomes was mainly due to a rise in agricultural product prices being offset by higher input costs. That led to EU farm incomes remaining low, at less than 50% of the average earnings of other sectors.
Results for the third quarter of Copa-Cogeca's agricultural barometer also reveals farmers' optimism in the sector has declined during 2012.
According to the organisation: "If confidence is not restored, it will endanger farmers investment and production plans which could have a disastrous impact on employment in related sectors, as well as market stability."
Mr Pesonen went on: "I therefore urge the EU heads of state to make a quick decision on the EU budget 2014-20, which ensures a good Common Agricultural Policy budget. I also call on all EU institutions to ensure there is a strong, innovative CAP in the future, which gives farmers the confidence to invest.
"With production lagging behind, the priority must be put on strengthening the economic role of farmers."
United Auctions sold 4655 prime lambs at Stirling on Thursday to a top of £92.50 per head and 220p per kg to average just 138p (-13.6p on the week).
The Cumberland & Dumfriesshire Farmers' Mart had 5494 prime lambs forward in Longtown on Thursday when Blackfaces and rougher lambs proved very hard to cash. Top prices on the day were £90 and 214.5p with the overall average levelling at 146.5p.
Another large show of 6880 cast sheep saw Mule and Continental-type ewes easier on the week, although good export-type hill and plainer ewes were sharper. Heavy ewes sold to £116.50 for Texels and averaged £63.04, while light ewes peaked at £69.50 for Cheviots and levelled at £37.44.
Cast rams sold to £120.50 for a Texel and averaged £77.27.