Zeagold said as soon as it was made aware of the investigation by the SFO, it pulled all of the eggs from Palace Poultry, saying it was able to verify that there were currently no Palace Poultry eggs in its supply chain or for consumer sale under its brands.
Zeagold is owned by Dunedin-based Mainland Poultry. Its managing director and chairman of the Egg Producers Federation Michael Guthrie said he was absolutely devastated.
"The first we knew about this was on about the 6th or 7th of February. We were notified by the SFO that they were conducting an investigation into Palace and wanted to talk to us about how we interacted with that company," Guthrie said.
"That day we pulled any business, which wasn't a lot, from them and any eggs we had from them at that time, we treated as ordinary eggs, not free range."
Guthrie said less than 3 per cent of Woodland eggs came from Palace in the last year, but given the company was allegedly selling caged eggs as free range, it was likely some of its caged eggs would have ended up in Woodland cartons.
He said although the company could verify all eggs currently for sale were free range with no eggs from Palace Poultry, the company's brand was still likely to be affected by the fallout.
"It is a huge betrayal but we're the ones who are going to pay for it," Guthrie said.
"We're not the only ones and we're actually a very small part of this but we have a high profile, it's a big brand and I tell you, I have never had such an upsetting day than I've had dealing with this."
Egg Producers Federation executive director Michael Brooks said the industry had no tolerance for ''ratbags'', and said the Federation was looking into egg stamping on farms to distinguish between caged and free-range eggs.
Brooks was confident the issue was isolated to the one farm.
"It's a relatively small industry; 126 farms so the industry sees this sort of thing as a real betrayal. If something is happening it will come out," Brooks said.
"I'm not hearing of other situations, though, This seems very much to be a one-off, but we will continue looking at this further step of egg stamping to give confidence to consumers, but also to try and preserve the integrity of the industry because people are really furious about what's happened here."
The SFO on Monday confirmed it was investigating allegations that Palace Poultry had sold millions of caged eggs as free range.
Countdown supermarket removed Palace Poultry eggs from its shelves on Monday after it became aware of the issue.
Countdown was the only supermarket to sell the brand, however, Woodland eggs are sold at a number of supermarket chains including Pak'n Save.
"What has happened here is the person allegedly purchased caged eggs to give more volume to their supply," Brook said.
"If those eggs had an egg stamp on them, it would make it a lot more difficult to [sell them as free-range]," he said.
"It's costly and there are difficulties, particularly for our smaller members who would have to do hand stamping. So there's a lot of things to work through but we are working through them to ensure there is confidence and integrity in the system."
When contacted, Ministry for Primary Industries (MPI) said it was not investigating the situation "because there is no evidence to suggest that there are any breaches under the legislation MPI is responsible for regulating".
The SPCA Blue Tick is the only 100 per cent independent accreditation focused on high animal welfare in New Zealand.
All SPCA Blue Tick labelled eggs come from farms approved by the SPCA to adhere to strict, high-welfare standards.
The SPCA Blue Tick is only given to layer hen farms and the organisation does not approve of or certify battery or colony cage systems.
The egg brands with the SPCA Blue Tick are
Henergy Cage Free
The Natural Free Range Co
Higgins Family Free Range
Uncaged Hens
Pams Cage Free
Bon Appetit
The Ultimate Egg Company
Sungold
Golden Down Organic Free Range
Doug's Free Range Eggs
Simply Cage Free
Ewing Poultry
