Moving to selling only cage-free eggs in supermarkets could end up hitting customers in the pocket, the industry says.
Foodstuffs, the owner of Pak'nSave and New World supermarkets announced on Thursday it will phase out caged eggs over the next 10 years.
Countdown Supermarkets has previously made a similar pledge, meaning both of the major supermarket chains in New Zealand are moving to only selling cage-free eggs.
But Michael Brooks, executive director of the Egg Producers Federation, says customers prefer eggs from caged chickens.
He says around three-quarters of eggs sold are colony or cage-farmed, and a move to cage-free would push up the price of eggs and make them too expensive for some.
"Cost and choice are very important to a large number of New Zealanders. Eggs are the most cost-effective form of protein, and for lower socio-economic groups a very important food source."
The egg industry has already moved away from traditional cages, Mr Brooks says, with some farms paying up to $1 million to convert their cages to a new kind of colony cages.
Earlier this year, Countdown pulled many of its so-called free-range eggs after finding out they weren't.