But it is also an environmental issue. The palm oil industry is blamed for rainforest destruction in Malaysia and Indonesia including precious habitats which are home to orangutans, tigers and elephants.
Auckland Zoo director Jonathan Wilcken, who has lobbied for palm oil labelling, said he was disappointed ministers were still not able to reach a decision.
The forum commissioned a review into labelling in 2009, which recommended two years later that oils should be specifically labelled.
"We're not asking them to break new ground," Wilcken said. "This is a decision that would just mirror what's already been implemented in the EU, in America and in Canada."
Campaigners say that close to half of the products on New Zealand supermarket shelves contain palm oil, including chocolate, margarine, soap and lipstick.
Green Party conservation spokeswoman Mojo Mathers said that under New Zealand's voluntary palm oil labelling regime, only the honest companies faced consumer backlash.
"This is unfair on these companies and does not help protect rainforests as consumers often unknowingly just switch to another product containing palm oil."
New Zealand shoppers had to be "expert detectives" if they wanted know whether foods contained palm oil, she said.
The powerful Food and Grocery Council, which represents producers and manufacturers, opposes mandatory palm oil labelling.
Chief executive Katherine Rich said there were was only so much information that could be fitted on a label and some information could be possibly be sourced in other ways, such as through apps and websites.
She said the trans-Tasman ministerial forum was primarily for food safety issues, and food labelling was being "used as a battleground" for "all sorts of non-safety issues" like deforestation and animal welfare.
It was unlikely these problems would be solved by "changing the small print on a paper label", she said.
Reports in the EU tentatively suggest that the introduction of mandatory palm oil labelling in 2014 had led to a change in consumer behaviour, forcing companies to source sustainable palm oil.
The forum meets just as New Zealand considers a change on another high-profile consumer issue - whether products should be labelled with their country of origin.
A bill in the name of Green MP Steffan Browning passed its first hurdle earlier this month. If passed into law, it would require mandatory country of origin labelling for single ingredient foods like fresh fruit, vegetables, meat, nuts, oils and flour.
It has the initial support of the National Party, which reversed its position on the issue because of growing consumer support for a change.
Australia adopted mandatory country of origin labelling in the early 2000s, and moved to a more sophisticated regime last year which covers most food sold in shops and supermarkets.
Browning said his bill was not as ambitious as the Australian regime because he wanted to ensure it gained the support to proceed.
Where does NZ stand?
Palm oil labelling
• NZ/Australia: No requirement to specifically disclose palm oil in products. Producers can use generic terms like "vegetable oils".
• UK/EU: Mandatory on food products.
• USA/Canada: Mandatory on food products.
Country of origin labelling
• NZ: Voluntary. Parliament considering a bill to make it mandatory for single-ingredient products.
• Australia: Labels must show if the food was made in Australia, and what percentage of the food was made in Australia.
• UK/EU: Mandatory for meat, fish, honey, olive oil, wine, fruit and veges imported from outside the EU.
• USA/Canada: Mandatory for meat since 2002, and for fresh fruit, vegetables and nuts since 2008.
