Choice spokesman Tom Godfrey said the guidelines should be in place where eggs are only considered free-range if farmers run no more than 1500 hens per hectare, which complies with CSIRO guidelines.
He said larger egg retailers have 'free-range' labeling on their packaging, despite running around 10,000 hens per hectare.
The national free range standard issue is expected to be debated at a meeting of state and federal consumer affairs ministers on Thursday.
“There is a divide in the industry, you have got genuine free-range farmers who invested in the infrastructure to run free-range farms and they want nationally enforceable standard that aligns with the CSIRO recommendation for free-range, which is 1500 birds per hectare,” Mr Godfrey said.
“The birds should have plenty of room to move inside and out, to have higher animal welfare standards as well."
Free-range egg producer Vesna Peko-Luketic runs fewer than 750 chooks per hectare on her farm west of Melbourne.
“It's either free-range or it's not,” she said, explaining that her production is the maximum stocking density recommended by the Free Range Farmers Association of Victoria.
“That is the number we can control and still maintain pasture and we can avoid soil contamination at that number."
But, it’s a guide-only as there's currently no enforceable stocking density standard in Australia for producers to qualify as free-range.
The body lobbying on behalf of the egg industry, Egg Farmers Australia, has said it has it's own number in mind.
“We believe one bird per square metre or 10,000 birds per hectare is the maximum limit ,” said Egg Farmers Australia spokesman, Brian Ahmed.
The absence of a national free-range standard has consumer advocates alleging some large producers and retailers are duping shoppers.
Mr Ahmed said the industry is in favour of displaying stocking density on cartons in order to avoid confusion, and the industry man not have to wait long.