The increasingly contentious issue of free-range stocking rates for poultry is under the microscope, with egg producers meeting around Australia to draw up a new maximum standard of 20,000 birds a hectare (two birds a square metre).

The Land reports that the proposed minimum is far higher than the current recommended 1,500 birds per hectare but the Australian Egg Corporation Limited argues existing models put no binding obligation on producers, some of whom have have lifted hen densities well above 20,000 per hectare.

This month's egg standards meetings come just as the poultry meat industry is drawing fire from the Australian Consumer and Competition Commission (ACCC) for using the term 'free to roam' for meat birds raised in sheds.

Fast food giant, KFC has stopped promoting the fact that its poultry comes from 'roam free' chickens after the ACCC launched legal action against big supplier, Baiada Poultry, for allegedly misleading consumers with the term.

The ACCC's Federal Court action, to be held this week also includes Victorian-based Turi Foods, which supplies the La Ionica brand, and peak industry body for producers, processors and suppliers, the Australian Chicken Meat Federation (ACMF).

The consumer watchdog said bird densities in barns did not allow enough movement for them to be branded 'free to roam' and consumers were mistakenly believing the birds roamed free in open paddocks.

Baiada's Steggles brand is a big source of shed-raised poultry to KFC, although it also has other farms with open housing supplying the fast-expanding free-range market under the Lillydale brand.

The Ingham brand is also big in the free-range poultry market, which in three years has blossomed from just three per cent of Australia's total 900,000 tonnes of poultry meat sales to about 12 per cent.

ACMF executive director, Andreas Dubs, told The Land the federation had tried to explain that shed-raised birds were 'free to roam' because they were not caged, as was often the perception of poultry production.

He said larger chooks in sheds were at typical densities of less than 10 per square metre with plenty of room to move around, although all chickens often naturally tended to congregate closely, leaving considerable barn space bare.

The ACMF had offered to adopt other descriptions as alternatives to 'free to roam' if the ACCC had any suggestions but the commission had declined to respond, although Mr Dubs hoped ongoing talks would settle the issue out of court.

Just like egg industry terms such as 'barn laid' and 'free-range', there are currently no enforceable definitions for 'free to roam', which has stirred rising debate among some producers, consumers and animal welfare organisations.

The nationwide egg industry meetings, which commenced in NSW and Victoria last week and finish at Toowoomba in Queensland next week, follow a market research campaign with consumers to assess shopper expectations of free-range production.

The Egg Corporation (AECL) survey polled more than 5,000 egg buyers and conducted focus groups in Melbourne, Parramatta and central Sydney to establish that consumers were comfortable with densities of two hens per square metre, after being offered options ranging from 250 birds per hectare to more than 20,000 per hectare.

AECL executive director, James Kellaway, said: "We've done robust analysis using research specialists asking respondents to make their own spatial selection on what they considered appropriate."

The focus groups also studied film footage of birds in a typical 20,000-per-hectare free-range environment and approved.

Responses from producer meetings so far had generally supported the draft plan to set the maximum at 20,000 per hectare, with discussion most passionate at the Melbourne workshop where some farmers wanted significantly tighter limits, while others have argued for a higher stocking rate.

The free-range stocking rate is part of a national review of about 200 egg industry production standards covering issues as diverse as water quality and room temperature in sheds.

The Land reports that feedback will help reshape the draft code which will be submitted to an independent technical committee for comment before being ratified by government.