The National Animal Welfare Advisory Committee says it is looking to ban the use of cages for housing layer hens.
The committee has released a new draft code of welfare for the hens.
The new code recommends that the cages that are used by 88% of egg producers in New Zealand are phased out.
Committee chair Dr John Hellstrom says the committee has not settled on a date for the phase out but all housing for layer hens must provide sufficient space to allow hens to stand and to extend and flap their wings.
He says the cages currently used by most in the industry do not even allow hens to fully stand.
Dr Hellstrom says the poultry industry faces a number of challenges to find and manage non-cage alternatives.
Submissions on the draft animal welfare code for layer hens close on 25 March.