FOOD imported from other countries and mixed in Australia can be labelled "Made in Australia".

And the finger has been pointed at the Federal Government for bowing to pressure from multi-nationals not to act on confusing labelling laws.

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An investigation by The Weekly Times also found that food sold in Australia and labelled "Made in New Zealand" can actually be from any country.

The investigation also found that cornflour labelled "Made in New Zealand" and found to contain lead was made in China.

It also found that foreign fruit that is juiced here and foreign meat crumbed here can use the "Made in Australia" logo under the Australian Competition and Consumer Commission's interpretation of relevant laws.

Independent Senator Nick Xenophon, who along with Nationals Senator Barnaby Joyce and Greens leader Bob Brown, has pushed a bill to tighten labelling laws, said loopholes allowing the practices were "obscene".

Senator Xenophon said the loopholes existed "because multi-national companies want them to" and consumers should ask why the Federal Government would not support the bill to tighten country-of-origin labelling.

Australian Made, Australian Grown chief Ian Harrison said the group was in the process of changing its constitution to outlaw several questionable labelling practices, thereby making the ACCC's interpretation of the law redundant.

"Its always been issue ... that the origin resides in (the packaging) country - it's not meant to open a passageway for goods to go through one country and flow into the other one," Mr Harrison said.

Senator Xenophon said the Government was bowing to multi-nationals by failing to support his push for stricter labelling laws.

"If multi-national companies can pass off foreign product as Australian or New Zealand product they make more money but local farmers lose their livelihoods," Senator Xenophon said.

Consumer magazine Choice spokesman Christopher Zinn said consumers were being frustrated in their wish for transparent labelling by a "very powerful and well-heeled manufacturers' lobby."

Consumer Jane Corbould, who caused an outcry when she discovered cornflour containing lead and bearing the "Made in New Zealand" label, said country-of-origin labelling was essential so consumers could "make our own decisions whether we like stuff grown in faeces or fertiliser".

A spokeswoman for Food Standards Australia New Zealand referred The Weekly Times to the ACCC, which was unavailable for comment.

Federal Consumer Affairs Minister Craig Emerson could not be contacted.