Health Star Ratings will only remain on some eligible products, after state and federal ministers from Australia and New Zealand agreed to keep the system voluntary.

Key points: Consumer group Choice wants Health Star Ratings to be mandatory on all packaged and processed foods

Consumer group Choice wants Health Star Ratings to be mandatory on all packaged and processed foods Australian and New Zealand ministers want sugar counts reassessed in the current program

Australian and New Zealand ministers want sugar counts reassessed in the current program The ministers are also considering the labelling of plant-based milk and meat alternatives

Consumer group Choice had been pushing for the system to be on all processed and packaged foods, accusing food manufacturers of "gaming" the scheme by picking and choosing which products to put stars on.

Health stars are currently present on just 30 per cent of packaged foods, but a draft review of the system released earlier this year recommended it be displayed on 70 per cent of eligible products by 2023.

In a meeting in Christchurch, food and health ministers, who sit on the forum chaired by Australian Sports Minister Richard Colbeck, decided to keep the scheme voluntary with "options for interim targets".

Choice's Linda Przhedetsky said it was a disappointing outcome.

"State, territory and federal ministers are missing an important opportunity to close a loophole that lets businesses pick and choose which products use this helpful labelling system," she said.

But Australian Food and Grocery Council chief executive Tanya Barden said the ministers had struck the right balance between industry and customers.

"Importantly, the Health Star Rating system has not been made mandatory and we consider this is the right outcome," she said.

"While uptake continues to increase and targets have been set, this would be premature and potentially counter-productive, resulting in a much slower and less responsive system."

Change-up to algorithm considered

The Health Star Rating System is designed to give customers an "at-a-glance" overall health rating of packaged and processed foods.

Foods are rated from half a star to five stars, depending on how many "healthy nutrients" and "risk nutrients" they are comprised of.

Choice and public health advocates have been calling for sugars that are added to food and beverages during manufacturing, to be differentiated from sugars that occur naturally within foods.

While they stopped short of that, ministers instead agreed to explore penalising "total sugars" more strongly in the algorithm that determines ratings.

They have referred the issue to the agency responsible, Food Standards Australia New Zealand, for review.

"Choice welcomes ministers' commitments to supporting greater penalties to the way that sugar and salt is calculated in the Health Star Rating algorithm," Ms Przhedetsky said.

"This will help catch out sugar-laden and salty snacks that are receiving higher ratings than they deserve."

Milk or mylk?

The ministers also considered claims that consumers were being misled by terms like "milk" and "meat" being used for alternative and plant-based products such as soy milk.

It's been politically contentious, with Nationals MPs and farm groups taking issue with the labelling of what they've called "fake", or plant-based meat products and their placement in supermarkets.

Ministers asked the Food Regulation Standing Committee to consider the issue, "with a view to developing a policy guideline to adequately differentiate 'synthetic' animal products from their natural or conventional equivalents".