About 70 people are protesting outside the Environment Court in Auckland this morning against a new chicken farm proposed for Patumahoe, near Pukekohe.

The group, including animal rights activists and neighbours of the proposed farm, say the farm would still treat the chickens cruelly by confining them in "large "colony cages" housing colonies of up to 60 birds.

Smaller "battery cages" housing typically only five to seven hens have to be phased out by 2022 under a law passed in 2012.

Craddock Farms has applied to build colony cages for 310,000 hens on a property that formerly had horse stables.

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Neighbours objected because the original proposal placed buildings within 150 metres of surrounding houses, and commissioners appointed by Auckland Council refused to grant a resource consent in January because they could not be sure that the neighbours would not be able to smell the hens.

The proposal was later modified to set the buildings back 300 metres from surrounding properties and add chimneys to dispel the smell. The Environment Court starts hearing Craddock Farms' appeal today in a hearing which is set down for seven days.

Neighbours Ray and Peta Berry, who live on a lifestyle block immediately next-door to the Craddock property, are outside the court with a sign saying, "The locals say no."

"The Craddock family bought a property where they can't comply with the Ministry for the Environment guidelines," Mr Berry said.

Mrs Berry said diseases spread from the chickens posed a risk to another neighbour's horticultural business, which depended on international health certification.

Animal rights activist Deidre Sims said colony cages gave hens only a slightly bigger space for each hen than the battery cages that are being banned.

"It's still not good enough because it's still a cage," she said.

"Austria, Germany and Switzerland have banned colony cages yet we are just introducing them. They are moving into barn and free range production."

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The Egg Producers Federation says colony cages "provide a minimum of 750 square cm per bird, and like an 'open plan' home they have access to the full area with room to move and interact socially with other hens".

Craddock Farms managing director Stefan Craddock said colony farming was "a highly researched method of egg production that looks after hen welfare" and was used in Britain, France and Spain.

"Colony farms are a way of producing large volumes of high quality and affordable eggs, priced at about $4 per dozen in the shops," he said.

"Around 80 per cent of New Zealanders choose to buy eggs at this price level to give their families a good source of affordable everyday protein. This is important when so many other protein rich foods have been priced out of household budgets."

He said the resource consent for the proposed farm was declined solely on the grounds of odour and that would be the single focus of the appeal.