The company running the Manus Island detention centre has refused a large shipment of "Freedom" muesli bars because the brand was thought inappropriate to give to asylum seekers who were locked up.

The ABC understands the $30,000 shipment of muesli bars arrived at the Manus Island centre about two weeks ago after a contractor was specifically asked to buy the brand.

But after they arrived the centre's operator, Transfield Services, refused to accept the shipment.

The ABC has been told the decision came after Australia's Department of Immigration and Border Protection intervened, which the department has denied.

Despite being briefed on the matter the department initially refused to discuss the situation when contacted by the ABC but in a statement later said the decision for where to get food was up to PNG authorities and service provider Transfield Services.

"The sourcing of food provided to transferees is a matter for the service provider and for the Papua New Guinea authorities responsible for the Manus Regional Processing Centre," the department said in a statement.

Those close to the issue have said that the bars, produced by the Sydney-based Freedom Foods, were not allowed to be given to the detainees because they were considered inappropriate for people who are locked in the detention centre, sometimes without any clear release date.

Conditions in the Manus Island centre have been in the spotlight recently, with a report earlier this month saying as many as 700 detainees were on hunger strike and up to 14 people had sewn their lips together.

The residential section of the Manus Island detention centre. ( AAP: Eoin Blackwell )

In December there were 1,035 asylum seekers housed in the Manus Island centre.

Last year Transfield Services was given a $1.22 billion contract to run the Manus Island and Nauru detention centres for 20 months.

Transfield also runs Australia's defence bases, and is believed to be considering distributing the bars via its Australian operation.

Living conditions in Australia's offshore detention centres have been criticised by the United Nations High Commissioner for Refugees.

Transfield Services was contacted by the ABC but referred the matter to the Department of Immigration and Border Protection.

Freedom Foods marketing manager Rebecca Carson said she was surprised by the events.

"Certainly we are disappointed that people there don't get to enjoy our product," Ms Carson said.

"I understand the bars will be distributed elsewhere, so they won't go to waste."